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
Shinheung SEC, a secondary battery safety component maker heavily reliant on Samsung SDI, has posted operating profit for three straight quarters as US ESS line conversion and data-center BBU demand drive a recovery phase.
The company has maintained operating profit for four consecutive quarters from Q3 2025 through Q2 2026.
However, net income attributable to owners has swung sharply by quarter, turning slightly negative again in Q2 2026.
As of 2025, revenue by site was about 50% Hungary, 23% Korea, 13% China, 8% Malaysia and 6% United States, underscoring heavy reliance on Hungary and Samsung SDI.
Investment in the Indiana, US plant has been completed, positioning the company to benefit from its customer's ESS line conversion.
In November 2025, multiple individuals including Shinheung SEC personnel were indicted in a Samsung SDI prismatic battery component technology leak case, with the trial still ongoing.
Founded in 1979 and listed on KOSDAQ in 2017, Shinheung SEC specializes in safety components for lithium-ion secondary batteries.
Its core products include Cap Assemblies and Cans for medium/large prismatic batteries, Current Interrupt Devices (CID) for small cylindrical batteries, and NS Assemblies used in coin cells for wireless earbuds.
The company is reported to hold the number-one market share in both the small cylindrical and medium/large prismatic segments. More than 90% of revenue is concentrated with a single customer, Samsung SDI, reflecting deep technical collaboration but also structural customer concentration risk.
As of 2025, revenue by production site was roughly 50% Hungary, 23% Korea, 13% China, 8% Malaysia and 6% United States, indicating heavy reliance on European and Asian manufacturing bases.
The company operates a global production network across three domestic sites and five overseas subsidiaries, each positioned near its customer's regional battery production hubs.
In the competitive landscape, Samsung SDI's contract structure limits entry by new suppliers other than a few incumbents, though companies such as Dongwon Systems have reportedly explored entry into the prismatic can business.
For growth, the company is diversifying its portfolio toward components for 46-phi (46mm diameter) cylindrical batteries, small CIDs for data-center Battery Backup Units (BBU), and LFP-compatible cap assemblies for ESS applications.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩102.7B | ₩2.1B | 2.1% |
| 2025Q3 | ₩100.2B | ₩2.7B | 2.7% |
| 2025Q4 | ₩101.9B | ₩5.4B | 5.3% |
| 2026Q1 | ₩123.7B | ₩1.6B | 1.3% |
| 2026Q2 | ₩131.6B | ₩5.2B | 3.9% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩477.8B | ₩31B | ₩19.6B | 6.5% | 6.4% | 113.2% |
| 2023 | ₩539.9B | ₩43.7B | ₩30.9B | 8.1% | 9.2% | 148.7% |
| 2024 | ₩432.8B | ₩13.2B | ₩22B | 3.0% | 6.1% | 144.3% |
| 2025 | ₩408.2B | ₩5.9B | -₩5.8B | 1.5% | −1.6% | 147.5% |
Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-21
Annual results peaked in 2023 with revenue of KRW 539.9 billion and operating profit of KRW 43.7 billion (8.1% operating margin), before slowing to KRW 432.8 billion in revenue and KRW 13.2 billion in operating profit (3.0%) in 2024, and further declining in 2025 to KRW 408.2 billion in revenue and KRW 5.9 billion in operating profit (1.5%), with net income attributable to owners turning negative at KRW -5.8 billion.
In 2022, the company posted revenue of KRW 477.8 billion and operating profit of KRW 31.0 billion (6.5%), confirming solid profitability even before the 2023 peak.
On a quarterly basis, Q2 2025 saw revenue of KRW 102.7 billion and operating profit of KRW 2.1 billion but a large net loss attributable to owners of KRW -12.2 billion; this reversed to profit in Q3 with revenue of KRW 100.2 billion, operating profit of KRW 2.7 billion and net income of KRW 3.3 billion, followed by continued improvement in Q4 with revenue of KRW 101.9 billion, operating profit of KRW 5.4 billion and net income of KRW 7.9 billion.
In Q1 2026, revenue rose to KRW 123.7 billion with operating profit of KRW 1.6 billion and net income of KRW 8.5 billion, while Q2 2026 showed both revenue (KRW 131.6 billion) and operating profit (KRW 5.2 billion) improving, yet net income attributable to owners slipped back into a small loss of KRW -0.2 billion.
This illustrates that operating-level recovery has not translated consistently into stable net profit every quarter.
On the balance sheet, 2025 operating cash flow remained solid at KRW 52.3 billion despite the net loss, while the debt ratio rose to 147.5% from 113.2% in 2022 but has stayed relatively stable in the 144-149% range over the past three years.
Overall, 2025 marked the trough for both revenue and profit, with the continuation of operating profit since Q3 2025 standing out as the key shift in the earnings trajectory.
The secondary battery safety component industry sits at a transition point between slowing EV demand and expanding data-center/ESS demand.
Industry research notes that demand for EV-use secondary batteries has weakened amid policy uncertainty, while the ESS market is expected to grow on mandatory installation policies and renewable energy expansion, with small-cell demand also seen growing over the medium term on xEV, ESS and power-tool applications.
Indeed, AI-industry expansion and the growth of data centers are boosting demand for small cells such as Battery Backup Units (BBU), which has been cited as a driver of cylindrical CID sales growth.
In the competitive landscape, only a limited number of makers can produce prismatic battery cans and cap components; Shinheung SEC and Sangsin EDP have contractually limited exposure to rival suppliers under their Samsung SDI agreements, even as newcomers such as Dongwon Systems have explored entry.
At the same time, a technology-leak controversy emerged as a later entrant pursued supply of prismatic components to a Chinese-affiliated battery maker, highlighting industry-wide intellectual property protection concerns.
Samsung SDI's restructuring of its global supply chain across Europe and the United States, along with its expanding next-generation cylindrical (4680, 46-phi) and ESS product roadmap, directly affects the medium-term positioning of its partner, Shinheung SEC.
The company's Indiana, US plant is reported to have already completed its capital expenditure, and future revenue growth is expected to hinge on the schedule for converting its customer's joint-venture StarPlus Energy 1 (SPE1) plant's EV lines to ESS production.
With SPE1's EV line utilization reportedly low in 2025, ESS-related supply reportedly began in the fourth quarter, boosting related revenue.
The Hungary site saw lower revenue in 2025 due to reduced European EV shipment volumes from its main customer, but supply for several new EV models is reportedly scheduled to begin sequentially in 2026.
On the product side, sequential line conversions to supply LFP-compatible cap assemblies are planned for the fourth quarter of 2026 through early 2027, and the company is said to have sufficient land and infrastructure already secured to respond to further customer investment beyond 2028.
The Korea Investors Relations Service stated in a January 2026 report that 2026 could mark the year when large-scale asset investment is completed and rising utilization at new plants offsets fixed-cost burden, driving a structural rebound in operating margin.
Samsung Securities said in a March 2026 report that it raised its target price from KRW 6,800 to KRW 7,700 and maintained a Buy rating, citing expanding cylindrical volumes tied to data-center BBUs and an ESS supply contract with a North American energy company.
These outlooks, however, are forward-looking statements subject to change, and the company itself notes in its IR materials that actual results may differ materially from such projections.
The current share price trades at a level below per-share book value, placing it in a discount range relative to net assets.
Looking at the most recent four quarters, operating profit has stayed in the black consecutively, but net income attributable to owners has oscillated between small profits and small losses quarter to quarter, without a fully settled direction.
The company currently does not pay a dividend, which limits comparisons based on dividend appeal. Since the 2022-2023 period of strong earnings saw the market assign relatively higher multiples, whether the recent loss-to-profit transition can be sustained remains the key variable for future valuation discussions.
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 2026-08-21
The company has posted operating profit for four consecutive quarters from Q3 2025 through Q2 2026. Growing cylindrical CID sales driven by rising demand for data-center Battery Backup Units (BBU), along with cost-restructuring effects, have been cited as drivers of the improvement.
Better power-tool shipments and expanding production of high-output BBU products for its customer are also cited as favorable factors.
With investment in the Indiana, US plant already completed, analysis suggests revenue growth is expected to align with the conversion schedule of the customer's StarPlus Energy 1 joint-venture plant from EV to ESS lines.
Line conversion for LFP-compatible cap assembly supply is also scheduled to begin sequentially from the fourth quarter of 2026. It has also been noted that the site and infrastructure already secured leave room to respond to further customer investment.
Shinheung SEC is reported to hold the number-one market share in both the small cylindrical and medium/large prismatic segments.
Its contractual relationship with Samsung SDI limits rival suppliers, making new entry difficult, and the lengthy customer qualification process for precision safety components adds a further barrier to entry.
The full-year 2025 operating margin fell to 1.5%, and net income attributable to owners posted an annual loss of KRW -5.8 billion. Even in Q2 2026, operating profit was positive but net income attributable to owners slipped back to a small loss of KRW -0.2 billion. This suggests that operating-level recovery has not yet translated into stable net income every quarter.
More than 90% of revenue comes from a single customer, Samsung SDI, and as of 2025 the Hungary site accounted for roughly half of total revenue. Hungary revenue reportedly declined in 2025 due to lower European EV shipment volumes from its main customer. Results remain highly exposed to shifts in the customer's production strategy or demand in specific regions.
In November 2025, prosecutors investigating a technology leak involving Samsung SDI's prismatic battery can and cap assembly technology indicted multiple individuals, including Shinheung SEC personnel.
The company stated it had not leaked any technology and that the matter involved the individual actions of a former employee with no corporate involvement, but the trial is expected to determine whether the technology qualifies as a trade secret and the extent of its actual use. Depending on the outcome, there could be reputational implications and effects on trust with customers.
With more than 90% of revenue concentrated in a single customer, Samsung SDI, results are directly affected by that customer's production strategy, new-model supply schedules, and the pace of battery form-factor transitions.
With limited customer diversification, changes in order volume from that one customer have an outsized impact on total revenue.
Multiple individuals, including Shinheung SEC personnel, were indicted in November 2025 in connection with a leak of Samsung SDI prismatic battery component technology, with the trial ongoing.
As the case involves alleged leakage of a designated national core technology, its progress and outcome could affect the company's external credibility and business relationships.
Operating multiple overseas production subsidiaries in Hungary, the United States, Malaysia and China exposes the company to currency fluctuations, local labor and energy costs, and changes in each country's industrial policy. If utilization at new production lines does not rise as expected, fixed-cost burden could increase.
Check the preliminary Q3 2026 earnings disclosure — worth monitoring whether operating margin improvement continues and whether net income volatility recurs.
Worth confirming whether the LFP-compatible cap assembly line conversion begins as planned and when related revenue starts to be reflected.
Worth tracking the progress and utilization ramp of the ESS line conversion at the StarPlus Energy 1 plant in the United States.
Worth monitoring the progress and outcome of the trial in the Samsung SDI prismatic battery component technology leak case indicted by the Suwon District Prosecutors' Office.
Worth checking whether supply for several new EV models begins as scheduled at the Hungary site.
Shinheung SEC has moved past its 2025 revenue and profit trough and entered a recovery phase, posting operating profit for four consecutive quarters since Q3 2025.
However, net income attributable to owners has swung between small profits and small losses by quarter, and has not yet settled onto a fully stable trajectory.
The completion of investment at the Indiana, US plant, the customer's ESS line conversion, and plans to supply LFP-compatible cap assemblies are cited as grounds for a medium-term growth story, but all remain forward-looking items whose execution needs to be observed.
The structure in which more than 90% of revenue comes from a single customer, Samsung SDI, and half of revenue comes from the Hungary site carries both strengths and risks simultaneously.
The technology leak indictment that surfaced in November 2025 remains a variable that could translate into reputational risk depending on the trial's outcome.
Overall, this stock sits in a phase where industry recovery coexists with customer concentration and legal uncertainty, and upcoming quarterly results along with progress on the US line conversion are likely to be the key variables shaping its future direction.
Report written 2026-09-05 · Data as of 2026-09-04
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