[Click eStock] "S1, Security Demand Increases Despite Economic Slowdown... Target Price 80,000 Won"

by Ryu Hyunseok

Published 04 Feb.2025 07:55(KST)

Updated 04 Feb.2025 08:32(KST)

Yuanta Securities analyzed on the 4th that despite the economic slowdown, security demand for S-1 is expected to increase. They gave a 'Buy' investment rating and a target price of 80,000 KRW.

[Click eStock] "S1, Security Demand Increases Despite Economic Slowdown... Target Price 80,000 Won"

S-1 recorded sales of 763.5 billion KRW and an operating profit of 47.9 billion KRW in the fourth quarter of last year. This represents increases of 10% and 14%, respectively, compared to the same period last year.

Lee Chang-young, a researcher at Yuanta Securities, said, "Security service sales increased by 3% year-on-year to 345 billion KRW due to the continuous increase in new physical security (Secom) subscribers," adding, "Infrastructure service sales grew by 16% year-on-year to 414.6 billion KRW, demonstrating high growth, influenced by the continued increase in building management demand for high-rise buildings, and sales growth in the security SI sector such as military bases and large corporate factories."

Yuanta Securities expects S-1's performance improvement trend to continue as security demand is rising despite the economic slowdown.

He explained, "Despite the unfavorable domestic economy and consumption, the company's net physical security subscribers have been continuously increasing every quarter for several years," and added, "Due to cost efficiency in building management of high-rise buildings, the company is increasing its managed building area at an annual growth rate of 5.7%, which is higher than the 3.2% growth rate in the number of buildings over 10,000㎡ in Korea."

He emphasized, "The security SI business, which showed high growth in the fourth quarter of last year, is also experiencing a structural demand increase independent of the economy, due to the rise of intelligent CCTV replacing people in military bases and hazardous material manufacturing plants," and added, "Infrastructure services are expected to maintain their growth trend through 2025."