[Click e-Stock] "Satrec Initiative Expected to Maintain Solid Performance Growth Through 2026"

On November 13, Hana Securities projected that Satrec Initiative would continue its stable sales growth and maintain solid performance into next year.

Han Yugun, a researcher at Hana Securities, stated, "Satrec Initiative's provisional results for the third quarter this year show sales of 50.44 billion won, up 15.5% year-on-year and 13.4% quarter-on-quarter. Operating profit reached 2.46 billion won, which is an increase of 213.1% compared to the same period last year and 21.2% compared to the previous quarter, resulting in an operating margin of 4.9%." Han analyzed, "Based on a robust existing backlog, the gradual expansion of revenue recognition has led to stable sales growth and five consecutive quarters of profitability."

Hana Securities expects Satrec Initiative to maintain its growth in the fourth quarter, projecting sales of approximately 61.9 billion won. Han added, "Like the defense industry, the space and aerospace sector typically sees a seasonal peak in the fourth quarter. Project progress is expected to accelerate further as we move from the fourth quarter of this year into 2026." He continued, "Including the recently secured contract for the proprietary satellite 'SpaceEye-T' model for the European market, the order backlog is expected to exceed 300 billion won by the end of the year."

In particular, the SpaceEye-T contract for Europe is expected to play a key role in the performance rebound of its subsidiary SIIS. Han explained, "This contract was not significantly reflected in the third quarter results and will start to be recognized as sales from the fourth quarter. SIIS's sales this year are expected to reach about 7.52 billion won, with a significant reduction in losses."

He further stated, "In 2026, SIIS is expected to achieve at least 15 billion won in sales, making a turnaround to profitability possible. With proprietary satellites, discussions with multiple clients are actively underway, and as maintenance costs are low, the pace of margin improvement should accelerate as sales increase."

Stable growth is expected to continue into 2026. Han noted, "As the revenue recognition phase for major pre-secured projects enters full swing, the satellite business segment on a standalone basis is projected to achieve sales of approximately 225.3 billion won in 2026, a 21.7% increase year-on-year. The subsidiary SIIS is also expected to grow by about 98.9% year-on-year as license fees from proprietary satellite contracts are recognized starting in the fourth quarter of this year."

Hana Securities forecasts Satrec Initiative's consolidated sales in 2026 to reach 244.1 billion won, up 25% from the previous year, with operating profit rising 76.7% to 15.7 billion won. Han commented, "With its satellite manufacturing capabilities and strong global references, this will be the year when overseas sales, as well as domestic sales, expand significantly. Despite stable performance growth, the current share price appears to be significantly undervalued compared to global competitors."

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