KOSDAQElectronic Components178320

Seojin System

₩41,850▲ 3.98%2026-10-02 close

Market Cap

₩2.6T

Turnover

₩83.6B

Volume

Shares out.

63.7M

PER

—

PBR

1.9×

EPS

-₩1,405

Dividend Yield

0.00%

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

Report overview

Order and Capacity Buildout Runs Ahead of Profits

Second-quarter 2026 revenue reached KRW 410.2bn, the highest quarterly figure on record for the company, yet the operating line stayed in the red, leaving the gap between top-line growth and profit as the central issue.

1
Full-year 2025 revenue of KRW 1,066.3bn came in below 2024's KRW 1,213.8bn, while operating profit shrank to KRW 1.1bn (0.1% margin) and the net loss attributable to owners reached KRW 101.2bn.
2
Quarterly trends bottomed in 3Q25 with a KRW 37.3bn operating loss, swung to a KRW 23.5bn profit in 4Q25, then returned to losses in 1Q26 (KRW 33.0bn) and 2Q26 (KRW 19.4bn).
3
The direct cause cited for the 2Q26 loss was deferred ESS shipments and revenue recognition due to delayed grid interconnection at the Houston, Texas plant (Eugene Investment & Securities, August 2026).
4
The semiconductor segment posted KRW 195.8bn of revenue in 2Q26, a sharp sequential jump, with first-half cumulative revenue of KRW 308.6bn already exceeding the full-year 2025 level according to press reports.
5
The debt-to-equity ratio rose from 140.2% in 2024 to 212.6% in 2025, while equity raises and perpetual convertible bonds proceed alongside unresolved Vietnamese tax and Korean disclosure-review issues.

Business structure

Seojin System is an electronics manufacturing services (EMS) company specializing in aluminum-centered metal parts and systems, listed on KOSDAQ in 2017.

Its businesses span energy storage systems (ESS), semiconductor equipment, EV and battery components, telecom equipment, and others; per data cited by Daily Invest in September 2025, first-half 2025 revenue mix was ESS equipment 42.0%, semiconductor equipment 24.8%, telecom 12.3%, EV and battery parts 5.6%, and other 15.3%.

The core ESS customer is Fluence Energy, a joint venture of Siemens and AES, and the company is reported to produce most components in-house except battery cells and cooling systems, selling in enclosure and DC-block form.

The semiconductor business runs through subsidiary Texon, which SK Securities said in a February 2026 report supplies power boxes, frame assemblies and process chambers to Lam Research.

Additional items mentioned include Bloom Energy solid oxide fuel cell modules, data center racks and printed circuit boards, while domestically the company has signed a series of ESS and data center power conversion system supply contracts with Ace Engineering.

Production is centered on large complexes in Bac Ninh and Bac Giang in Vietnam, with US sites in Houston, Texas, plus Indiana and Georgia being prepared and brought online in sequence.

Vertical integration is treated as the company's defining trait; Eugene Investment & Securities said in a March 2026 report that it verified in-house coverage from metal processing through electrical assembly to final assembly.

Competitively it is benchmarked against global EMS names such as Jabil, Sanmina and Celestica, and some commentary highlights its dual Vietnam-plus-US footprint at a time when the US applies high tariffs to Chinese battery and ESS components.

That said, ESS customer concentration remains high, and segment-level profitability is not separately disclosed, which limits verification.

Earnings trend

Quarterly revenue · Operating profit

₩258.6B-₩6B25Q2₩215.5B-₩37.3B25Q3₩311B₩23.5B25Q4₩280.2B-₩33B26Q1₩410.2B-₩19.4B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩787.6B₩44.4B2022₩778.7B₩49B2023₩1.2T₩108.7B2024₩1.1T₩1.1B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩258.6B	-₩6B	−2.3%
2025Q3	₩215.5B	-₩37.3B	−17.3%
2025Q4	₩311B	₩23.5B	7.6%
2026Q1	₩280.2B	-₩33B	−11.8%
2026Q2	₩410.2B	-₩19.4B	−4.7%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩787.6B	₩44.4B	₩1.6B	5.6%	0.3%	156.7%
2023	₩778.7B	₩49B	-₩22.6B	6.3%	−4.5%	205.2%
2024	₩1.2T	₩108.7B	₩84.3B	9.0%	9.7%	140.2%
2025	₩1.1T	₩1.1B	-₩101.2B	0.1%	−13.8%	212.6%

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

Earnings analysis

On an annual basis, 2022 revenue was KRW 787.6bn with operating profit of KRW 44.4bn (5.6% margin) and 2023 revenue KRW 778.7bn with operating profit of KRW 49.0bn (6.3%), so the top line was flat while margins edged up; in 2024 both scaled up to revenue of KRW 1,213.8bn and operating profit of KRW 108.7bn (9.0%).

In 2025, however, revenue fell to KRW 1,066.3bn and operating profit all but vanished at KRW 1.1bn (0.1%), with a net loss attributable to owners of KRW 101.2bn.

Net income attributable to owners was KRW 84.3bn in 2024 but negative in 2023 (KRW 22.6bn loss) and 2025 (KRW 101.2bn loss), pointing to very high earnings volatility.

Quarterly data show a slide from 2Q25 revenue of KRW 258.6bn and a KRW 6.0bn operating loss to 3Q25 revenue of KRW 215.5bn and a KRW 37.3bn operating loss, followed by a swing to profit in 4Q25 on revenue of KRW 311.0bn and operating profit of KRW 23.5bn.

Losses then resumed with 1Q26 revenue of KRW 280.2bn and a KRW 33.0bn operating loss, and 2Q26 revenue of KRW 410.2bn with a KRW 19.4bn operating loss.

In 2Q26 the company stayed in the red despite a sharp sequential revenue increase, and the net loss attributable to owners of KRW 40.6bn exceeded the operating loss, suggesting non-operating costs also weighed.

Eugene Investment & Securities said in an August 2026 report that revenue grew faster than cost of sales, which it read as fixed costs beginning to be absorbed, and noted that consolidated profit is recognized only when the US subsidiary ships finished goods, so recognition delays magnified fixed-cost pressure.

On cash flow, operating cash flow was an inflow of KRW 42.6bn in 2023 but an outflow of KRW 113.5bn in 2024 and KRW 39.8bn in 2025, a wide divergence from reported earnings.

The balance sheet also shifted, with total equity down from KRW 875.6bn in 2024 to KRW 737.8bn in 2025 and total liabilities up from KRW 1,227.6bn to KRW 1,568.7bn, lifting the debt-to-equity ratio from 140.2% to 212.6%; the sum of the last four quarters (3Q25 to 2Q26) shows a net loss attributable to owners of KRW 82.8bn.

Industry analysis

The end markets boil down to two pillars: power infrastructure demand driven by AI data center expansion, and semiconductor equipment investment.

On the ESS side, the discussion centers on managing renewable intermittency and stabilizing data center power, and Eugene Investment & Securities said in a November 2025 report that Nvidia's 800V DC architecture would become a new axis pulling ESS demand. That same demand, however, has acted as a near-term bottleneck.

According to Lead Economy, the Texas grid (ERCOT) has been under severe strain from heat waves and a surge in data centers, delaying new interconnection approvals and pushing back revenue recognition at Seojin System's Houston plant.

The customer base appears relatively deep, with Fluence Energy's first-quarter 2026 backlog reported at about USD 5.6bn and its pipeline at 147GWh.

The semiconductor segment is framed around expanding high-bandwidth memory and rising NAND layer counts, which require repeated deposition and etch steps and equipment upgrades; SK Securities noted in a February 2026 report that Lam Research's component sourcing in Korea had passed KRW 1trn a year.

Competitively the company is benchmarked against global EMS players such as Jabil, Sanmina and Celestica, with internalized metal-processing steps presented as its differentiator.

Conversely, EMS margins swing heavily with customer order schedules and raw material prices, so even a favorable cycle position leaves wide quarterly earnings amplitude.

Outlook

The shared framing from both the company and the market is a weak first half followed by a stronger second half. iM Securities, in a report dated August 20, 2026, estimated third-quarter revenue of KRW 559.0bn and an operating profit of KRW 88.0bn, citing shipment of deferred ESS volumes and growth in semiconductor equipment revenue.

In the same report iM Securities said the order backlog stood at roughly KRW 1trn with deliveries scheduled through the second quarter of next year, and that confirmed purchase orders for semiconductor equipment were understood to exceed KRW 500bn.

Eugene Investment & Securities, in an August 18, 2026 report, said it maintained a Buy rating and a target price of KRW 67,500 while cutting its 2026 operating profit estimate from KRW 102.3bn to KRW 47.7bn.

Through the same broker, the company was reported to be negotiating with its customer to recognize profit from the point of semi-finished goods delivery, a variable that will determine whether the recognition-lag issue eases structurally.

On capacity, a new Vietnam plant including a dedicated semiconductor cleanroom is slated for completion in the second half, and the Indiana site was reported to have started operating from July.

Funding comes from a KRW 180bn third-party share placement approved on April 22, 2026 (4,026,846 new shares with a one-year lockup) and a KRW 37.5bn 39th perpetual convertible bond decided on August 24, with the latter earmarked entirely for US ESS and semiconductor equipment facility investment from September 1, 2026 to March 31, 2027.

All of these figures, however, are broker estimates and company plans; confirmed results can only be verified through quarterly filings.

Valuation

PER

—

PBR

1.9×

ROE

-9.6%

EPS

-₩1,405

BPS

₩17,550

Dividend per share

₩0

Because the sum of the last four quarters (3Q25 to 2Q26) shows a net loss attributable to owners, no earnings-based multiple can be calculated, and the related field on the screen card is blank.

The current price is therefore effectively explained by the multiple against net assets plus assumptions about future profit recovery, and the shares trade at a premium to net assets.

Note that the multiple varies with how book value per share is computed, and the fact that the Korea Exchange figure runs higher than the in-house calculation should be read in light of equity-classified instruments such as convertible and perpetual bonds and differences in the share count basis.

The multi-year profit path reversed direction twice, from a net loss in 2023 to a profit in 2024 and back to a loss in 2025, which makes it difficult to treat any single point-in-time multiple as a normalized level.

No cash dividend has been declared under recent filings, so shareholder returns do not support the valuation case.

For reference, Eugene Investment & Securities said in its August 18, 2026 report that the recent share price decline had already reflected the second-quarter earnings shortfall; that is the broker's view and not KOSAI's judgment.

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

Bull factors

Semiconductor Numbers Moved First

According to Lead Economy and Hankyung, second-quarter 2026 semiconductor equipment revenue was KRW 195.8bn, up more than 70% sequentially, with first-half cumulative revenue of KRW 308.6bn already above the full-year 2025 level.

Unlike the ESS deferral issue, this is revenue already recognized rather than forecast. iM Securities said in an August 20, 2026 report that confirmed purchase orders for semiconductor equipment were understood to exceed KRW 500bn. Rising in-house coverage of components and machining steps is also cited as an area with room to improve.

Backlog Base and Customer Diversification

After roughly KRW 180bn of orders from Fluence Energy in November 2025, domestic contracts followed in 2026: KRW 270.2bn from Ace Engineering in March, KRW 120.6bn in April, and KRW 187.0bn for ESS and data center power conversion systems in May. iM Securities put the backlog at around KRW 1trn in an August 2026 report, with deliveries scheduled through the second quarter of next year.

Fluence Energy's own first-quarter 2026 backlog was reported at about USD 5.6bn, indicating the top customer's volume base is holding. Expansion into North American volumes for Korean cell makers and Bloom Energy fuel cell items is also discussed.

A Non-China Manufacturing Footprint

With the US applying high tariffs to Chinese battery and ESS components, the combination of large Vietnamese complexes and US sites in Texas and Indiana is a frequently cited element in supply-chain realignment discussions.

SK Securities relayed in a February 2026 report the company's plan to handle design, machining, assembly, verification and shipment within the US to reduce tariff and logistics risk.

Eugene Investment & Securities said in a November 2025 report that de-risking away from China had become a necessity rather than an option in building North American AI infrastructure. Whether that positioning converts into actual margins, however, is a separate item to verify.

Bear factors

Losses Persist Even as Revenue Grows

Second-quarter 2026 revenue of KRW 410.2bn was the largest in the provided quarterly series, yet the company booked a KRW 19.4bn operating loss and a KRW 40.6bn net loss attributable to owners. For full-year 2025, revenue of KRW 1,066.3bn produced only KRW 1.1bn of operating profit, a 0.1% margin.

In four of the five reported quarters, top-line expansion did not translate into profit. With fixed costs and depreciation stepping up, any slippage in recognition timing can repeat the damage to earnings.

Balance Sheet and Dilution Pressure

The debt-to-equity ratio rose from 140.2% in 2024 to 212.6% in 2025, and operating cash flow was negative for two straight years, at KRW 113.5bn out in 2024 and KRW 39.8bn out in 2025.

Funding continued with a KRW 180bn third-party placement in April 2026 (4,026,846 new shares) and a KRW 37.5bn perpetual convertible bond in August; TheBell reported in April 2026 that the company was approaching institutions for a KRW 280bn convertible bond issue.

Bloter reported in June 2026 that some financial investors were said to have withdrawn from discussions during a KRW 300bn perpetual bond process. With fundraising ongoing, potential dilution and interest and capital costs warrant continued monitoring.

Tax and Disclosure Credibility Issues

According to Edaily, subsidiary Seojin Vietnam received assessment notices from the Hanoi General Department of Customs between February 6 and May 18, 2026 for import value-added tax and related items worth roughly KRW 118.3bn, paid them in three installments between April 22 and May 20, and obtained a bank guarantee on June 11 for late-payment surcharges of about KRW 38.0bn.

The company said it filed an appeal covering roughly KRW 101.3bn of that amount, relating to VAT on free-issue ESS batteries.

The same outlet reported that the Financial Supervisory Service's disclosure review division opened an inquiry on the grounds that the matter should have appeared in the first-quarter report, and that the company amended that report on June 25.

In a separate statement the company said the tax amount was not final and that the VAT was refundable under zero-rating for exports, but the outcome of the process and the regulatory determination remain unconfirmed.

Risk factors

Customer and Project Concentration

ESS equipment accounted for 42.0% of revenue in the first half of 2025, and the segment's core customer is understood to be Fluence Energy.

Deferred orders from that customer and the bankruptcy of the second-largest customer were cited as causes of the 2025 downturn, so a structure in which one customer's schedule drives company-wide earnings could recur.

Diversification is under way through North American volumes for Korean cell makers and the Ace Engineering contracts, but it will take time before the effect shows up in results.

US Grid and Infrastructure Bottlenecks

The direct cause of the second-quarter 2026 shortfall was delayed grid interconnection at the Houston plant amid Texas power shortages. Lead Economy reported that conditions deteriorated to the point where Texas Governor Greg Abbott temporarily suspended approvals for new data center grid connections.

This bottleneck is an external variable outside the company's control, so even the assumption of normalized shipments from the third quarter could slip. The pace at which additional sites such as Indiana stabilize also needs to be monitored.

Ownership and Governance

Bloter reported that largest shareholder and CEO Jeon Dong-kyu lent the company KRW 168.7bn raised from a block sale of 2.5 million shares, and that his pledge-related debt fell from KRW 393.6bn at end-January to around KRW 122.8bn.

Still, a funding loop built on the controlling shareholder's stake is sensitive to share price moves and collateral terms.

According to Edaily, the company was previously designated an unfaithful disclosure corporation for reversing a spin-off decision in 2024 and for a delayed disclosure in 2025, and share sales by six executives in May 2026 were also raised as an issue. Governance matters can directly affect funding terms and institutional participation decisions.

What to watch next

Mid-November 2026
The third-quarter 2026 report filing. The key questions are whether iM Securities' August 2026 estimate of KRW 88.0bn in quarterly operating profit and Eugene Investment's call for a quarterly swing to profit are confirmed in the actual filing, and in particular which quarter the deferred ESS revenue lands in.
Fourth quarter 2026
Completion of the new Vietnam plant including a dedicated semiconductor cleanroom, and its initial utilization. A slip in completion would also push back the semiconductor equipment segment's capacity to absorb volumes and its in-house sourcing ratio improvement.
September 2026 to March 31, 2027
The stated deployment window for facility funds from the KRW 37.5bn 39th perpetual convertible bond decided on August 24. Watch whether the US ESS and semiconductor equipment facility investment proceeds as planned and whether further funding disclosures follow.
During the second half of 2026
The outcome of the Vietnamese VAT appeal and of the Financial Supervisory Service's disclosure review. Whether the appealed amount results in a refund, and how any finding of disclosure violation or sanction is resolved, matter for both the balance sheet and credibility.
January 18, 2027 and December 31, 2027
The contract end dates for the KRW 120.6bn ESS equipment supply agreement and the KRW 187.0bn ESS and data center power conversion system agreement with Ace Engineering. Delivery adherence and the distribution of revenue recognition will show how much of the backlog actually converts into reported results.

Overall view

Seojin System's current situation can be summarized as a timing gap between revenue and profit.

From 2024 revenue of KRW 1,213.8bn and operating profit of KRW 108.7bn (a 9.0% margin), it retreated sharply to 2025 revenue of KRW 1,066.3bn, operating profit of KRW 1.1bn (0.1%) and a net loss attributable to owners of KRW 101.2bn; in the second quarter of 2026, record quarterly revenue of KRW 410.2bn still came with a KRW 19.4bn operating loss and a KRW 40.6bn net loss attributable to owners.

The bullish case rests on the semiconductor equipment segment already moving in reported numbers, the roughly KRW 1trn backlog cited by iM Securities in August 2026, and the non-China manufacturing footprint.

The bearish case rests on a balance sheet where the debt-to-equity ratio climbed from 140.2% to 212.6% with two consecutive years of operating cash outflows, dilution pressure from successive equity and perpetual bond issuance, and unresolved regulatory matters spanning Vietnamese VAT and the disclosure review.

Added to that is the fact that bottlenecks outside the company's control, such as Texas grid interconnection, can shift the timing of profit recognition. The limited number of houses publishing estimates, as Hankyung reported in August 2026, also means the consensus band is narrow.

Ultimately the third-quarter confirmed results, and whether they show deferred revenue recognition and fixed-cost absorption at the same time, will be the dividing line for this setup; this report is for informational purposes and contains no buy or sell recommendation or target price.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

Show 18 more articles and sources

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.