SEOUL, October 16 (AJP) - Since Russia's invasion of Ukraine in February 2022, global defense spending has soared. Europe's rush to rearm has opened new markets for Asian manufacturers, pushing South Korea into the front line of the world's fast-growing arms trade. Among the companies leading this surge is Hanwha Aerospace, which has evolved from a domestic supplier into one of Asia's most active defense exporters.
Global rearmament and Hanwha Aerospace's rise
So-called "K-defense" exports jumped from $7.2 billion in 2021 to $17.3 billion in 2022, according to South Korea's defense ministry. SIPRI — a Stockholm-based institute that tracks international arms transfers — ranked Seoul among the world's top 10 arms exporters, alongside the United States, France, Russia, China and Germany.
The surge, fueled by competitive pricing and flexible production, marks a structural shift in the nation's export portfolio long dominated by semiconductors, cars and ships.
At the center of this export boom stands Hanwha Aerospace, South Korea's largest defense contractor by sales. Since 2022, the company has secured a series of contracts with Poland, including billions of dollars' worth of K9 self-propelled howitzers and K239 Chunmoo multiple rocket launchers. These deals were followed by exports of Redback infantry fighting vehicles to Australia and new artillery and ammunition agreements with Romania, reflecting a broader push into NATO and EU markets.
Founded in 1977 as Samsung Precision, Hanwha Aerospace began with aircraft engines and joined Hanwha Group in 2015. It has since grown into South Korea's leading defense manufacturer, spanning technologies from artillery systems to space propulsion.
A soaring stock and divided performance
The company's rapid expansion has also been mirrored in financial markets. Hanwha Aerospace's stock has surged nearly twentyfold since early 2022—just before the Ukraine war—jumping from around 50,000 won (about $36) to more than 1 million won (about $720) this year.
Still, risks remain. Defense orders are cyclical and often subject to shifts in global security priorities. The sustainability of Hanwha's export momentum depends on continued demand and its ability to scale production efficiently.
Lee added that while the company's land systems remain highly profitable, "the aerospace segment needs greater focus on R&D, particularly in indigenous engine development, to build new growth momentum."
In fact, in its latest earnings report for the second quarter of 2025, Hanwha Aerospace's overall operating profit rose 156 percent year-on-year to 865 billion won (about $630 million), driven largely by surging demand in its land systems division. However, the company's aerospace segment posted a 1.8 percent loss.
Beyond defense exports, Hanwha Aerospace is investing heavily in AI-based unmanned systems, advanced propulsion technologies and satellite engines — areas that bridge defense and commercial innovation. The company played a key role in the country's Nuri space launch project and continues to expand its aerospace portfolio, positioning itself at the intersection of national security and space technology.
Analysts expect Hanwha Aerospace's defense business to remain solid in the coming years, as defense spending continues to rise across Europe and the Middle East.
"This isn't just a short-term boom," Lee said. "Structural growth in overseas defense projects, combined with persistent geopolitical tensions, would keep exports expanding. As a result, Hanwha's stock is likely to maintain its upward trend over the medium to long term."
reporter
Cheon Soram
cheons@ajupress.com
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