KOSPIMachinery100840

SNTEnergy

₩36,300▼ 0.55%2026-10-02 close
Market Cap
₩717.3B
Turnover
₩3.8B
Volume
100,000 shares
Shares out.
19.8M
PER
5.9×
PBR
1.6×
EPS
₩5,554
Dividend Yield
3.52%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩1,150 per share · Prices as of the 2026-10-02 close

01

Report overview

LNG and Data Center Demand Drive Order and Earnings Leverage

SNT Energy posted sharp earnings growth in 2025 on the back of its number-one global position in air coolers and expanding HRSG business, but revenue has now declined for two straight quarters in 2026, making the pace of new order recovery a key watch point.

  1. 1

    2025 revenue reached KRW 606.1bn and operating profit KRW 111.3bn, up roughly 106% and 400% year on year respectively, but revenue fell for two consecutive quarters in 1Q-2Q 2026.

  2. 2

    On September 2, the company signed a KRW 128.2bn HRSG supply contract with Korea Southern Power for the Hadong LNG combined-cycle plant, equal to 21.14% of 2025 revenue.

  3. 3

    Building on its number-one global market share in air coolers, the company is expanding into HRSG and localizing US production through its joint venture SNT Global.

  4. 4

    2025 new orders of KRW 390.2bn came in below 2024's KRW 742.3bn, shrinking the order backlog to KRW 594.1bn, a factor flagged as a variable for future growth.

  5. 5

    Hyundai Motor Securities raised its target price from KRW 51,000 to KRW 62,000 in a March 2026 report.

02

Business structure

SNT Energy designs and manufactures heat-exchange equipment for energy and process plants, including air-cooled heat exchangers, heat recovery steam generators (HRSG), surface condensers, and selective catalytic reduction (SCR) systems.

Its core product, the air cooler, cools process fluids at refining and petrochemical plants using air instead of water, making it especially valuable in the Middle East where industrial water supply is constrained.

The company holds the number-one position in the global air cooler market and has a track record dating back to 1990, when it became the first in Korea to localize high-frequency fin-tube production, a core HRSG component.

In 2022 it acquired domestic competitor KHE to expand production capacity, consolidating its position as Korea's only comprehensive air cooler supplier.

Its second pillar, HRSG, recovers waste heat from gas turbine exhaust at combined-cycle, cogeneration, and nuclear power plants to generate steam, and it recently formed a joint consortium with Doosan Enerbility to participate in a large domestic LNG combined-cycle project.

Daishin Securities noted in a March 2026 report that, based on 2025 revenue, air coolers accounted for 81.4%, HRSG for 16.6%, and other products such as SCR for 2%.

The customer base is diversified across Saudi Aramco and ADNOC in the Middle East, global oil majors such as Chevron and ExxonMobil in the United States, and domestic clients including SK Ecoplant, GS Caltex, GS E&C, and state-run power generators such as Korea Southern Power, Korea Western Power, Korea East-West Power, and SK Innovation E&S.

In the competitive landscape, BHI has held the number-one global position in HRSG for two consecutive years, so SNT Energy is pursuing a strategy of extending its air cooler dominance into HRSG.

More recently, the company has moved to secure a North American production base by building an integrated local manufacturing facility in Louisiana through SNT Global, a joint venture with SNT Motiv.

03

Earnings trend

Quarterly revenue · Operating profit
RevenueOperating profit
Annual revenue · Operating profit
RevenueOperating profit
Quarterly results · Last 5 quarters
QuarterRevenueOperating profitOp. margin
2025Q2₩140.7B₩27.4B19.5%
2025Q3₩148.3B₩24.3B16.4%
2025Q4₩201.9B₩46.8B23.2%
2026Q1₩123.6B₩22.8B18.5%
2026Q2₩108.1B₩21.3B19.7%
Annual results
YearRevenueOperating profitNet income (parent)Op. marginROEDebt-to-equity
2022₩202.9B₩3.6B₩15.1B1.8%5.9%68.3%
2023₩322B₩20.8B₩22.7B6.5%8.2%53.3%
2024₩294.3B₩22.2B₩34.6B7.6%11.3%68.7%
2025₩606.1B₩111.3B₩84.4B18.4%23.1%61.7%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04

04

Earnings analysis

2025 consolidated revenue reached KRW 606.1bn, up about 106% from KRW 294.3bn in 2024, while operating profit surged roughly 400% to KRW 111.3bn from KRW 22.2bn, lifting the operating margin sharply from 7.6% to 18.4%.

The low-margin structure that persisted through 2023 (revenue KRW 322.0bn, operating profit KRW 20.8bn, margin 6.5%) and 2022 (revenue KRW 202.9bn, operating profit KRW 3.6bn, margin 1.8%) improved markedly between 2024 and 2025 through operating leverage from revenue expansion.

Net profit attributable to owners rose steadily each year, from KRW 15.1bn in 2022 to KRW 22.7bn in 2023, KRW 34.6bn in 2024, and KRW 84.4bn in 2025.

On a quarterly basis, revenue rose modestly from KRW 140.7bn with operating profit of KRW 27.4bn in 2Q25 to KRW 148.3bn revenue with KRW 24.3bn operating profit in 3Q25, even as operating profit declined, while owner net profit jumped sharply from KRW 11.0bn to KRW 24.9bn.

The fourth quarter of 2025 delivered the strongest quarterly results on record, with revenue of KRW 201.9bn and operating profit of KRW 46.8bn, driving full-year performance, with net profit expanding to KRW 40.2bn.

However, in 2026 first-quarter revenue fell to KRW 123.6bn with operating profit of KRW 22.8bn, down roughly 39% from the fourth quarter, and second-quarter revenue declined again to KRW 108.1bn with operating profit of KRW 21.3bn, marking two consecutive quarters of revenue contraction.

Operating margin, however, held steady at around 18.5% in the first quarter and about 19.7% in the second quarter even as revenue declined, indicating that profitability management has remained stable regardless of top-line size.

Net profit stayed resilient at KRW 26.6bn in the first quarter and KRW 18.1bn in the second quarter, and the trailing four-quarter sum (3Q25-2Q26) of owner net profit reached KRW 109.7bn, exceeding the full-year 2025 level and suggesting the earnings base has shifted to a structurally higher tier.

05

Industry analysis

SNT Energy's core end markets are refining and petrochemical plants along with power generation equipment, and more recently surging power demand from AI data centers has emerged as a new demand driver for LNG combined-cycle power investment.

Daishin Securities noted in a March 2026 report, citing Gas Exporting Countries Forum data, that global LNG export volumes are expected to rise from 408 million tonnes in 2023 to 800 million tonnes by 2050, with North America and the Middle East contributing 130 million tonnes and 106 million tonnes of the increase, respectively.

LS Securities said in a January 2026 report that with the US Commonwealth LNG project (Technip selected as EPC) nearing a final investment decision and Delfin FLNG expected to reach FID within the year, order momentum was likely to build in the first half.

In the Middle East, under local-content procurement policies in Saudi Arabia, the UAE, and Qatar, SNT Energy operates local subsidiaries in Saudi Arabia and the UAE and has secured a long-term supply agreement with Saudi Aramco, providing a stable revenue base.

In HRSG, while BHI holds a strong global position, SNT Energy has been assessed as having achieved new market entry after being designated a main HRSG vendor at Aramco's IKTVA forum.

An industry source noted that after a prolonged downturn thinned out the number of competitors in the global power equipment market, surging demand has created conditions in which suppliers with sufficient capacity can pass rising costs through to prices.

Domestically, a wave of projects converting aging coal-fired plants to LNG combined-cycle plants is opening up a market for additional orders of HRSG and related power generation equipment.

06

Outlook

SNT Energy disclosed on September 2 that it had signed a KRW 128.2bn HRSG supply contract with Korea Southern Power for the Hadong LNG combined-cycle power plant, with the contract period running from September 2026 to December 2029 and the project executed through a joint consortium with Doosan Enerbility.

This contract value equals 21.14% of 2025 consolidated revenue of KRW 606.0bn, meaning a single contract could materially affect future annual revenue.

LS Securities explained in a September 2025 report that the company plans to invest about KRW 80bn through SNT Global, a joint venture with SNT Motiv, to build its first integrated local manufacturing facility in Louisiana to pursue the US market.

This localization strategy is seen as aimed at deepening ties with major global customers such as Bechtel, the EPC contractor for the Woodside Louisiana LNG project in the United States.

Hyundai Motor Securities raised its target price from KRW 51,000 to KRW 62,000 in a March 20, 2026 report, citing continued revenue from process plant projects such as UAE's Hail & Ghasha and Saudi Arabia's Fadhili and Jafurah.

LS Securities estimated in a January 2026 report that with the order backlog shrinking following last year's decline in new orders, 2027 revenue would be flat before resuming growth from 2028, making the pace of new order recovery a key variable for the growth path ahead. iM Securities noted in an April 2026 report that 2025 new orders of KRW 390.2bn were below 2024's KRW 742.3bn but still exceeded the historical average, with the order backlog at end-2025 standing at KRW 594.1bn.

07

Valuation

PER
5.9×
PBR
1.6×
ROE
30.8%
EPS
₩5,554
BPS
₩20,270
Dividend per share
₩1,150

Having moved past the low-margin years of 2023-2024 to post high-teens operating margins from 2025 onward as earnings scaled up, the multiples the market assigns to this stock appear to sit in a higher zone relative to its historical trading band.

The price-to-book ratio trades at a premium to net asset value, which can be read as a reflection of recent profit growth outpacing the growth in equity capital.

The dividend yield ranks on the low side compared with other machinery and plant equipment names in the sector, suggesting the investment appeal of this stock leans more on earnings growth and order momentum than on income.

Target prices vary across brokerages depending on the order and earnings outlook at the time they were issued; Hyundai Motor Securities raised its target price to KRW 62,000 in a March 2026 report.

That said, such targets are based on assumptions at the time of publication and may be revised as subsequent quarterly results and new order flow are reported.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-09-04

08

Bull factors

LNG and Data-Center-Driven Order Expansion

Surging power demand from AI data centers is stimulating LNG combined-cycle investment, with major projects such as Commonwealth LNG and Delfin FLNG in the United States moving toward final investment decisions.

Domestic demand is also continuing, exemplified by the September 2 Hadong LNG combined-cycle HRSG contract worth KRW 128.2bn, equal to 21.14% of 2025 revenue. In the Middle East, new revenue sources are expanding, including the designation as a main HRSG vendor at Aramco's IKTVA forum.

Operating Leverage Effect

2025 revenue grew about 106% year on year while operating profit surged roughly 400%, lifting the operating margin from 7.6% to 18.4%. Even as revenue softened slightly in the first half of 2026, operating margin remained in the high-teens to roughly 20% range.

This suggests that in a business with significant fixed costs, profitability can expand rapidly once revenue scale crosses a threshold.

Global Market Position and Localization

Building on its number-one global market share in air coolers, the company is expanding into HRSG, and its 2022 acquisition of KHE secured its position as Korea's only comprehensive supplier.

Through the SNT Global joint venture, it is building an integrated local production facility in Louisiana to deepen ties with global EPC firms such as Bechtel. Regional diversification across the Middle East and the United States is underway.

09

Bear factors

Slowing New Order Growth

2025 new orders of KRW 390.2bn fell below 2024's KRW 742.3bn, and the order backlog shrank to KRW 594.1bn. LS Securities accordingly raised the possibility that 2027 revenue could stagnate. If new order recovery is delayed, there is a risk that the strong growth seen in 2025-2026 proves temporary.

Rising Quarterly Revenue Volatility

After peaking at KRW 201.9bn in the fourth quarter of 2025, revenue declined for two consecutive quarters to KRW 123.6bn in the first quarter and KRW 108.1bn in the second quarter of 2026.

Given that revenue recognition is concentrated around large projects, quarterly results can be uneven depending on contract execution schedules. This makes it difficult to judge trends from any single quarter's results.

Sensitivity to Foreign Exchange and Costs

With a large share of contracts denominated in foreign currency, revenue and margins can be affected by exchange rate movements against the won. Changes in cost factors such as specialty materials or labor can also create profitability differences across projects.

The fact that net profit has swung considerably relative to operating profit on a quarterly basis also points to the influence of non-operating factors.

10

Risk factors

Order-to-Revenue Conversion Risk

Large power and plant projects can see revenue recognition delayed due to construction or design changes, or customer-side circumstances. With the order backlog having declined, a slower pace of new contract signings could create future revenue gaps.

Multi-year contracts such as the Hadong HRSG deal can also create period-to-period earnings variation depending on how revenue is allocated across years.

Customer and Regional Concentration

Revenue is concentrated among a small number of large customers and EPC firms centered on the Middle East and the United States, exposing the company to political and policy shifts in those regions. Changes in US LNG export policy or Middle Eastern local-content procurement rules could directly affect order flow. The relatively low share of domestic customers means the company remains heavily dependent on overseas markets.

Potential for Intensifying Competition

In the HRSG market, BHI maintains the number-one global position, so competition for market share is likely to continue.

Given that there have been past periods of intensified low-price order competition, the possibility cannot be ruled out that new entrants or capacity expansion by existing competitors in response to rising demand could reintroduce pricing pressure.

11

What to watch next

  1. Early-to-mid November 2026 (expected 3Q26 quarterly report)

    Check whether 3Q26 revenue and operating profit continue the decline seen in the first two quarters, and whether new orders and the backlog show signs of recovery.

  2. Fourth quarter of 2026

    Whether large US LNG projects such as Commonwealth LNG and Delfin FLNG reach final investment decisions could affect the future pipeline of new air cooler orders.

  3. From September 2026 onward

    The progress of the Hadong LNG combined-cycle HRSG project (September 2026-December 2029) and its quarterly revenue recognition schedule warrant tracking.

  4. Early 2027

    The timing of the start of operations at SNT Global's Louisiana production facility and its initial utilization rate will serve as a gauge of the success of the North American localization strategy.

12

Overall view

SNT Energy delivered sharply higher revenue and profit in 2025, underpinned by its number-one global position in air coolers and its expanding HRSG business, with operating margin improving markedly from the low single digits to the high teens.

However, revenue declined for two consecutive quarters in the first half of 2026 from its fourth-quarter peak, and both 2025 new orders and the order backlog came in below the prior year, raising questions about the durability of this growth.

The September Hadong HRSG contract and the Louisiana localization effort are cited as factors that could expand the medium-term order base, but the timing and pace of final investment decisions on US LNG projects remain an external variable.

Brokerage target prices vary by the timing they were issued and could be revised depending on future earnings and order announcements.

Valuation appears to sit in a higher zone relative to its historical trading band, making it important to track whether the earnings base is sustained and whether the order backlog begins to rebuild.

Investors will need to watch upcoming quarterly results and news on large-project final investment decisions to judge whether this trend continues.

13

Sources

  1. Korea Exchange (KRX) — Prices · Market Cap · Volume
  2. FSS electronic disclosure system (DART) — Financial statements · Dividend filings
Show 18 more articles and sources
  1. alphasquare.co.kr
  2. goinsider.kr
  3. edaily.co.kr
  4. file.alphasquare.co.kr
  5. goinsider.kr
  6. file.alphasquare.co.kr
  7. invest.deepsearch.com
  8. asiatoday.co.kr
  9. hisnt.com
  10. dailyinvest.kr
  11. dailyinvest.kr
  12. m.thinkpool.com
  13. hisnt.com
  14. hisnt.com
  15. dailyinvest.kr
  16. v.daum.net
  17. judal.co.kr
  18. judal.co.kr

Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.