PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close
S&W's revenue has grown even as its operating margin compressed sharply, and while quarterly operating profit has turned positive again in 2026, a recent governance change warrants close attention.
2025 consolidated revenue rose to KRW 48.8 billion year-on-year, but the operating margin fell sharply from 7.3% to 1.8%.
After posting an operating and net loss in Q4 2025, the company returned to operating profit in both Q1 and Q2 2026.
Key customers are large shipbuilders and engine makers including HD Hyundai Heavy Industries and Samsung Heavy Industries, with marine engine parts forming the core of revenue.
In August 2025 the largest shareholder changed from former CEO Jeong Hwa-seop to Sinil, a private company wholly owned by the current CEO's son, raising governance-related controversy.
The debt ratio rose from 43.1% in 2024 to 59.5% in 2025, indicating a somewhat heavier capital structure burden.
S&W is a Busan-based manufacturer organized into three business segments: marine (diesel) engine parts, industrial parts, and forged products.
The marine engine parts segment produces engine bolts, valves, seat rings, cams, and camshafts, while the industrial parts segment makes bolts used in large construction and plant projects. The forged products segment manufactures forged components used in ships, heavy equipment, and automotive parts.
The company's key customers include world-class engine makers and major construction firms such as HD Hyundai Heavy Industries, Samsung Heavy Industries, and Hanwha Engine, positioning it as a lower-tier supplier within Korea's shipbuilding and engine supply chain.
According to external research data, the 2025 revenue mix showed marine engine bolts at roughly 26%, valves and seat rings around 16%, and industrial parts near 18%, with the remainder classified as other revenue.
Founded in 1967 to manufacture bolts and nuts, the company was incorporated in 1990, renamed to its current form in 2003, and listed on KOSDAQ in 2009, giving it a long operating history.
Under KOSDAQ's industry classification it falls under machinery and equipment, while under FICS classification it is grouped with shipbuilding-related parts makers, reflecting a business character closely tied to the shipbuilding and heavy industry value chain.
Within the marine equipment parts market, the company occupies the position of a small-to-mid-sized component supplier amid a landscape of larger engine and equipment makers.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩12B | ₩700M | 5.9% |
| 2025Q3 | ₩11.6B | ₩400M | 3.2% |
| 2025Q4 | ₩12.6B | -₩100M | −0.8% |
| 2026Q1 | ₩11.5B | ₩300M | 2.7% |
| 2026Q2 | ₩12.8B | ₩400M | 3.2% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩36B | ₩2.5B | ₩2.3B | 6.9% | 5.5% | 45.9% |
| 2023 | ₩43.6B | ₩3.2B | ₩3.5B | 7.4% | 7.6% | 47.0% |
| 2024 | ₩47.1B | ₩3.5B | ₩4.8B | 7.3% | 9.6% | 43.1% |
| 2025 | ₩48.8B | ₩900M | ₩3.6B | 1.8% | 6.8% | 59.5% |
Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-23
Consolidated revenue rose for four consecutive years, from KRW 36.0 billion in 2022 to KRW 43.6 billion in 2023, KRW 47.1 billion in 2024, and KRW 48.8 billion in 2025, showing steady top-line expansion. Profitability, however, moved in the opposite direction.
Operating profit fell sharply from KRW 3.2 billion in 2023 and KRW 3.5 billion in 2024 to just KRW 0.9 billion in 2025, and the operating margin dropped from the mid-7% range in 2023-2024 to 1.8% in 2025. Net income attributable to owners also declined, from KRW 4.8 billion in 2024 to KRW 3.6 billion in 2025.
On a quarterly basis, the company maintained revenue of around KRW 11.6 billion, operating profit near KRW 0.4 billion, and net income near KRW 0.9 billion through Q3 2025, but in Q4 2025 revenue rose to KRW 12.6 billion while the company swung to an operating loss of KRW 0.1 billion and a net loss of KRW 0.2 billion.
It subsequently returned to profitability in Q1 2026 (revenue KRW 11.5 billion, operating profit KRW 0.3 billion, net income KRW 0.3 billion) and Q2 2026 (revenue KRW 12.8 billion, operating profit KRW 0.4 billion, net income KRW 0.6 billion), though operating profit remains below the KRW 0.7 billion level seen in Q2 2025.
Summing the most recent four quarters (Q3 2025 through Q2 2026), revenue totals roughly KRW 48.5 billion with operating profit under KRW 1 billion, indicating that a clear annual-margin recovery has not yet materialized.
The debt ratio also rose from 43.1% in 2024 to 59.5% in 2025, adding to the balance-sheet burden alongside the margin compression.
Korea's shipbuilding industry has seen expanding order volumes in recent years amid tightening International Maritime Organization environmental regulations, aging-fleet replacement demand, and rising secondhand ship prices.
Some industry commentary points to diversifying order cycles for large engine makers as new demand sources such as data-center power engines, LNG carriers, and special-purpose defense vessels gain attention.
However, a report on the third-quarter 2025 shipping and shipbuilding trends and 2026 outlook by the Export-Import Bank of Korea projected that global economic slowdown and expanding newbuilding supply would keep the market weak, with little improvement expected in 2026.
The same report noted that while latent demand from aging-fleet replacement remains, newbuilding orders are likely to stay somewhat sluggish due to worsening shipping-market conditions and delays in implementing the IMO net-zero framework.
Shipbuilding is known to follow long cycles, with upswings typically lasting five to six years and downswings eleven to thirteen years, and given that the current upcycle has already persisted for several years, discussion of a later-stage cycle position is also ongoing.
S&W, as a lower-tier parts supplier within this shipbuilding and engine value chain, has performance closely tied to the order and production plans of larger shipbuilders and engine makers upstream.
At the same time, its industrial parts and forged products segments provide some diversification into construction, plant, heavy equipment, and automotive parts customers.
No separately disclosed revenue or profit guidance from the company has been confirmed, and future performance is likely to hinge on the order and production schedules of major customers among the large shipbuilders, as well as raw material price trends.
Whether the Q4 2025 swing to loss was a one-off factor or reflects a persistent cost burden will require further confirmation through quarterly results in the second half of 2026 and beyond.
The return to operating profit in both Q1 and Q2 2026 can be read as a signal that the company has at least moved past the scale of loss seen in Q4 2025, though profit levels remain below the same period a year earlier.
On the governance front, market attention to the related-party shareholding structure and transactions has continued since the largest shareholder changed to Sinil in August 2025, making any further disclosures or regulatory review outcomes a variable worth monitoring independently of share price.
On the industry side, conflicting signals—a projected slowdown in 2026 shipbuilding orders alongside emerging new demand from data centers and LNG—are expected to affect S&W's order volumes as a parts supplier with some time lag.
On the balance-sheet side, whether the rise in the 2025 debt ratio reflects a one-off transaction or a persistent trend will need to be confirmed in the next set of annual results.
The stock trades at a notable discount to net asset value, with its price-to-book ratio positioned well below 1x.
On the earnings side, 2025 net income declined from the prior year, and the sum of the most recent four quarters also falls short of levels seen in 2024 and early 2025, so the pace of earnings recovery should be weighed alongside any read on price relative to profit levels.
Regarding dividends, no per-share cash dividend has been confirmed for the most recent fiscal year, suggesting the stock is more likely to draw interest from investors focused on asset value or earnings trends than on shareholder returns via dividends.
As a small parts supplier within the shipbuilding value chain, trading volume and liquidity are often limited, and this small-cap characteristic should be factored into any interpretation of valuation metrics.
Given that a multi-year revenue expansion trend and recent margin pressure are occurring simultaneously, a balanced view that considers both top-line and profitability indicators together is warranted.
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 2026-08-23
Domestic shipbuilding orders have expanded on the back of tightening IMO environmental regulations, aging-fleet replacement demand, and rising secondhand ship prices.
Some analysis points to diversifying order cycles for large engine makers as new demand sources such as data-center power engines and LNG carriers gain prominence. As a lower-tier parts supplier in this value chain, S&W is positioned to indirectly benefit from expanding upstream demand.
After posting an operating and net loss in Q4 2025, the company returned to operating profit for two consecutive quarters in Q1 and Q2 2026. Revenue also rose to KRW 12.8 billion in Q2 2026, an increase from the prior quarter. Having moved past the deep loss phase, the trajectory of upcoming quarterly results is worth tracking.
The stock trades at a price-to-book ratio well below 1x, indicating a substantial discount to accounting net asset value. This fact, however, needs to be interpreted alongside the pace of earnings recovery and market liquidity constraints.
The 2025 operating margin fell to 1.8%, sharply down from the mid-7% range in 2023-2024. Despite revenue growth, profit declined due to cost pressures, and net income attributable to owners fell from KRW 4.8 billion in 2024 to KRW 3.6 billion in 2025. Until a clear earnings recovery is confirmed, margin pressure remains a key risk.
In August 2025 the largest shareholder changed from the former CEO to Sinil, a private company wholly owned by the current CEO's son.
According to media reports, questions have been raised that Sinil's share-purchase funds were sourced through a real estate transaction with S&W, fueling ongoing conflict-of-interest controversy. This governance issue has been cited as a factor weighing on minority shareholder confidence.
A 2026 outlook report from the Export-Import Bank of Korea projected that market conditions would struggle to improve amid global economic slowdown and expanding newbuilding supply.
Domestic shipbuilders' orders were also expected to remain somewhat sluggish due to worsening shipping-market conditions and delays in implementing the IMO net-zero framework. Should upstream orders slow, S&W's order volumes as a downstream parts supplier could be affected with a time lag.
Fluctuations in raw material prices such as alloy steel directly affect the cost structure. Cost pressure has been cited as a factor behind the sharp margin decline in 2025, and if revenue growth continues without a corresponding profit increase, financial flexibility could be constrained.
Conflict-of-interest controversy has been raised over related-party real estate transactions and share-purchase financing during the 2025 change in largest shareholder. Any further related-party transactions or regulatory review procedures could affect market confidence.
Shipbuilding follows a long cycle in which downturns tend to last far longer than upturns, and given that the current upcycle has already persisted for several years, discussion of a cycle turn has emerged.
Expanding competitiveness among Chinese shipbuilders and engine makers is also cited as a potential competitive risk for lower-tier suppliers in Korea's supply chain.
Q3 2026 earnings and the quarterly report should be checked to see whether the operating profit trend seen in Q1-Q2 2026 continues and how quickly margins are recovering.
Monitor disclosures on shareholding changes by largest shareholder Sinil and related parties, as well as any additional related-party transactions, to track the follow-up developments of the governance controversy raised in 2025.
New order and production plan announcements from key customers such as HD Hyundai Heavy Industries, Samsung Heavy Industries, and Hanwha Engine should be tracked to gauge upstream demand trends and changes in parts order volume.
The 2026 full-year results release should be checked to confirm whether the rise in the debt ratio was temporary and whether the annual operating margin improved compared to 2025.
S&W is a lower-tier parts supplier within the shipbuilding and engine value chain, having gone through a year marked simultaneously by four consecutive years of revenue growth and a sharp deterioration in profitability, with the operating margin plunging in 2025.
Following a swing to loss in Q4 2025, the company returned to operating profit for two consecutive quarters in Q1 and Q2 2026, though profit levels remain below the same period a year earlier.
The August 2025 change in largest shareholder to a private company wholly owned by the CEO added governance-related uncertainty amid conflict-of-interest controversy over related-party transactions.
The industry backdrop presents conflicting signals, with structural demand factors such as IMO regulations and aging-fleet replacement on one hand, and institutional reports projecting an order slowdown in 2026 on the other.
Financially, the debt ratio rose sharply within a single year, adding to observed capital-structure burden.
On balance, the stock sits at the intersection of three variables worth monitoring together: the durability of the earnings recovery, the follow-up developments of the governance issue, and the direction of the shipbuilding cycle.
Report written 2026-09-05 · Data as of 2026-09-04
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