"Now Is the Cheapest"... Stocks Forecast for a 'Sharp Rise' After December 4 [Weekend Money]

Section 232 of U.S. Trade Expansion Act to Drive Momentum
Top Picks: OCI Holdings and Hanwha Solutions

There is a forecast that the share prices of solar energy companies, including OCI Holdings and Hanwha Solutions, will surge dramatically in December.

On September 26, Yoon Jaesung, a researcher at Hana Securities, said, "The recent weakness in solar company share prices is the result of concerns over slowing solar demand due to interest rate hikes, the possibility of short-term underperformance, and caution ahead of the US-China summit." He added, "After the implementation of Section 232 of the US Trade Expansion Act on December 4, stock prices are expected to rise sharply."

He continued, "The period from the end of this month to the end of next month will be the last opportunity to buy solar stocks at the lowest prices before the next big upward cycle begins." He also noted, "Our top picks are OCI Holdings and Hanwha Solutions."

Section 232 of the Trade Expansion Act is a regulation that allows the US government to restrict imports or impose high tariffs on imported goods – such as polysilicon and other solar materials – if they are deemed a threat to national security. Because of this regulation, companies like OCI Holdings and Hanwha Solutions, which have non-Chinese supply chains, are seen as beneficiaries.

The shift in the status of the solar industry in the United States is also noteworthy. Researcher Yoon commented, "The emergence of power shortages due to artificial intelligence (AI) and semiconductor-related demand, as well as the development of the defense and space industries, has elevated the solar industry from a mere decarbonization sector to a key strategic asset in the US-China power competition."

He explained, "Solar power plays a crucial role in building the power infrastructure, which is a bottleneck in the competition for dominance in AI and semiconductors. In fact, solar accounts for 43.4GW, or 51%, of all utility-scale new generation capacity planned in the US this year, which demonstrates this trend."

He further stated, "Some solar companies operate in the semiconductor-grade polysilicon and wafer business, making them essential for establishing semiconductor upstream capacity and strengthening defense resources. The survival of solar companies is crucial to building an upstream semiconductor ecosystem, which is also vital for manufacturing defense electronic components such as radar and drones."

He added, "The ecosystem of the space-based solar power industry also deserves attention. The National Aeronautics and Space Administration (NASA) has already banned collaboration with China, and SpaceX is also building a supply chain that excludes China."

This content was produced with the assistance of AI translation services.