[Edaily Reporter Kim Hyung-il ] Korea Investment & Securities projected that HANWHA AEROSPACE(012450)will see expanded opportunities for additional exports within Europe following its export contract with Croatia for the Cheonmu system. The firm maintained its “Buy” rating and target price of 2 million won, and also reaffirmed its status as the top pick in the defense sector.

On the 14th, Jang Nam-hyun, an analyst at Korea Investment & Securities, stated, “The company has signed a Cheonmu export contract with Croatia,” adding, “The contract is worth approximately 410 million euros (about 638.6 billion won) and will involve the supply of 18 Cheonmu launchers, guided missiles, and related equipment.”

The total project cost announced by the Croatian government is 435 million euros (approximately 677.5 billion won). Separately from HANWHA AEROSPACE, Poland’s WB Electronics will be responsible for supplying and integrating the command and control system. Croatia will replace its existing Vulkan and BM-21 Grad multiple rocket launchers and secure long-range precision strike capabilities with a range of over 300 km.

Researcher Jang highlighted the significance of this contract, noting that “the excellent performance and fast delivery times—traditional strengths of South Korean defense companies—continue to serve as competitive advantages in exports” and that “further market expansion is possible based on the local production bases established in Europe.”

Like Estonia, Croatia has already adopted the HIMARS rocket system but has additionally selected the Cheonmu. Researcher Jang cited the need for long-range precision strike capabilities and the requirement for rapid deployment as the reasons behind this decision.

While the HIMARS system adopted by Croatia is primarily composed of Guided Multiple Launch Rocket Systems (GMLRS) with a range of over 70 km, the recent Cheonmu contract includes ballistic missiles with a range of over 300 km. Accordingly, the explanation is that this will complement existing capabilities while expanding long-range strike capabilities.

Croatia also cited a delivery timeframe of 24 to 36 months and high supply reliability as reasons for adopting the Cheonmu. Researcher Jang predicted, “Amid rapidly growing demand within Europe, the Cheonmu will expand its export market based on its long-range strike capabilities and fast delivery times.”

He also highlighted the potential market within Europe. Researcher Jang estimated the demand for replacing aging multiple-launch rocket systems among European NATO member states at 581 units. He further noted that the potential market for Cheonmu would expand even further when considering additional procurement demand from HIMARS-operating countries, such as Estonia and Croatia.

He also projected that the localization infrastructure established primarily in Poland would support additional exports. With the Polish-version Cheonmu, the Homar-K, already supplied to Poland—featuring locally sourced vehicles and a command-and-control system—and the CGR-080 production facility established to manufacture the Cheonmu, Poland’s WB Electronics will participate in supplying the command-and-control system for this Croatian project.

Researcher Jang analyzed, “The local cooperation framework established in Poland is being utilized for projects in third countries,” adding, “It is clear that this local cooperation base is expanding to supply within Europe.”

However, it has not yet been confirmed whether the guided missiles to be produced in Poland will be supplied to Croatia. Researcher Jang predicted that as the number of Cheonmu-operating countries in Europe increases, the utilization of the production base centered in Poland will rise, leading to enhanced competitiveness in securing additional orders.

Researcher Jang assessed, “We are at a turning point, shifting from exports focused on product competitiveness to a business structure that integrates local production and supply chains,” adding, “A foundation is being established that will enable us to sustain exports in the long term, going beyond short-term order growth.”