IBK Securities evaluated on the 14th that Hanwha Solutions is expected to expand its market share in the solar power market due to concerns about the bankruptcy of major competitors in the United States. They also noted that the Chinese government’s policies to curb excessive competition in the solar business are viewed as a positive factor for Hanwha Solutions. Accordingly, the target stock price has been raised from 37,000 won to 44,000 won, and the investment opinion is maintained as 'buy.'

A Qcells ‘Q.PEAK DUO BLACK’ solar module is installed in a garage in North Carolina, USA./Courtesy of Hanwha Solutions

Hanwha Solutions' operating profit for the second quarter of this year is estimated at 135.9 billion won. This represents a 348.2% increase compared to the previous quarter and exceeds the market expectation (consensus) of 121.8 billion won. The performance improvement in the core institutional sector of renewable energy, along with the base effect from the chemical business due to regular maintenance last quarter, has driven the results.

The operating profit of the renewable energy institutional sector is projected to be 185.2 billion won. The increase in solar module shipments and the expansion of sales in the U.S. market, along with the rise in advanced manufacturing tax credit (AMPC), have had a positive impact. The increase in product sale prices in the U.S. due to tariff hikes is also serving as a boon.

The policy to curb excessive competition in the solar industry, promoted by the Ministry of Industry and Information Technology (MIIT) of China, is also beneficial for Hanwha Solutions. The Chinese government plans to promote policies aimed at curbing overproduction by emphasizing crackdowns on low-cost competition, the elimination of outdated facilities, and quality improvements. Consequently, mergers and acquisitions involving small competitors of large polysilicon companies are underway.

In this situation, competitors are also beginning to collapse one by one. The American solar corporation SunPower filed for bankruptcy last year, followed by SunNova last month filing for bankruptcy protection. SunNova is reported to be experiencing difficulties in its operations due to weak demand, rising interest rates, and changes in government policies.

Lee Dong-wook, a researcher at IBK Securities, said, "The residential energy business is expected to sustain continuous high growth, as the tax credit benefits will remain until 2027. With concerns about the bankruptcy or operational sustainability of American competitors SunPower and SunNova, the possibility of Hanwha Solutions increasing its market share is significant."

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