Shares of Hanwha Ocean surged 10% Tuesday after U.S. President Donald Trump announced the South Korean firm will play a key role in building new frigates for the U.S. Navy. The announcement highlights the deepening strategic partnership between Washington and Seoul, anchored by a major bilateral trade and investment pact.

Trump stated the warships will be constructed at the Hanwha Philly Shipyard in Philadelphia—a facility acquired by the Korean firm in 2024 as part of South Korea’s broader $150 billion shipbuilding pledge to the U.S. In exchange for tariff reductions on its exports, Seoul has committed to $350 billion in total investments across American industries.

A Boon for Korean Defense Stocks

Hanwha Ocean, a leader in constructing both commercial LNG carriers and military naval platforms, has seen its stock rise over 220% this year. It is part of a sweeping rally in South Korean defense equities, with peers Hanwha Aerospace and Hyundai Rotem up more than 170% and 270% year-to-date, respectively.

The frigate project aligns with the U.S. Navy's recently unveiled FF(X) class program for smaller, multi-role combatant ships. Navy Secretary John Phelan noted these vessels will complement larger warships and form part of what Trump calls the “Golden Fleet.”

Expansion to "Trump-Class" Battleships

In a separate announcement on Monday, President Trump revealed plans for two new “Trump-class” battleships, with a potential future fleet of up to 25. He described them as “the fastest, the biggest, and by far, 100 times more powerful than any battleship ever built,” intended to be equipped with hypersonic weapons, lasers, cruise missiles, and nuclear capabilities.

“These ships will help maintain American military supremacy, [and] inspire fear in America’s enemies all over the world,” Trump stated, framing the builds as central to his national security vision.

The dual announcements signal a significant ramp-up in U.S. naval procurement, with foreign allies like Hanwha positioned to benefit from the specialized manufacturing and investment commitments embedded in renewed trade frameworks. The developments underscore how geopolitical and industrial policies are increasingly driving defense market valuations and global supply chain dynamics.