[Click eStock] "SNT Dynamics, producer of 'K-Defense Transmission', target price up"

"Sales Expected to Exceed 500 Billion Won This Year"

On the 28th, SK Securities raised the target price of SNT Dynamics from 18,000 KRW to 25,000 KRW, stating that "this year, the company will achieve sales of 500 billion KRW again for the first time since 2015, and the profitability improvement trend will continue." The buy rating was also maintained. SNT Dynamics mainly produces defense transmission systems and firepower equipment such as artillery, transmissions and axles for commercial and passenger vehicles, and machine tool parts.

On the same day, Na Seung-doo, a researcher at SK Securities, said, "Sales in the first quarter of this year reached 114.1 billion KRW, an 11% increase compared to the same period last year, and operating profit increased by 21% to 11 billion KRW, continuing a clear performance improvement trend," adding, "It is estimated that the expansion of the defense sales ratio in the transportation equipment business segment is driving the performance improvement trend."

He continued, "As K-defense exports increase, this is a time when the determination to localize defense technology and parts is stronger than ever. Although large-scale exports are being achieved across various product categories, without domestic technology, reliance on overseas sources is still inevitable," and pointed out, "SNT Dynamics' transmissions have already undergone sufficient technical verification and have various cases of practical use, so there is a high possibility of further expansion into additional areas."

He said, "When the issue of adopting domestic transmissions arose in the past, and after the outbreak of the Ukraine war, a multiple in the low 30s was applied. Considering this, there is ample room for further price increase," adding, "The shortage of floating shares, on the contrary, highlights the attractiveness of a sold-out stock. If additional shareholder value enhancement moves appear, market interest could grow even more sharply."