[Edaily Reporter PARK MIN ] On the 16th, HEUNGKUK METALTECH CO.,LTD. maintained its “Buy (BUY)” rating on S-1(012750), citing the company’s solid core business performance and the announcement of robust shareholder value enhancement measures, including a large-scale share buyback and cancellation. The firm raised its target price by 26.3%, from 95,000 won to 120,000 won. This represents an upside potential of 23.0% compared to the previous trading day’s (October 15) closing price of 97,600 won.

Hwang Seong-jin, Head of the Research Center at HEUNGKUK METALTECH CO.,LTD., stated in a report published that day, “The shareholder return plan announced by the company is a very positive policy that significantly exceeds not only previous levels but also market expectations,” adding, “It is time to focus on positive factors such as steady growth based on a stable business structure, efforts to identify new growth engines, and shareholder return policies that exceed expectations.”

S-1 unexpectedly announced a shareholder return plan the previous day, centered on a large-scale buyback and cancellation of treasury stock. The company decided to allocate surplus funds—excluding those earmarked for future investments—to shareholder returns, utilizing a total of 1.4 trillion won in resources, consisting of 920 billion won in current cash reserves and 480 billion won in projected free cash flow (FCF) over the next three years.

Specifically: △ Full cancellation of existing treasury shares (11.02%) by November 2026 △ A new public tender offer for treasury shares totaling 450 billion won (4.55 million shares, 11.96%, 99,000 won per share), followed by the cancellation of all shares acquired △ Maintain a dividend payout ratio of 50–60% over the next three years and set a minimum dividend per share (DPS) of 3,200 won.

Analysts estimate that the total share cancellation under this plan will amount to approximately 23% of outstanding shares, resulting in an increase in earnings per share (EPS) of about 15% and a significant expansion of the cumulative shareholder return rate over the next three years to 134% (an average of 45% per year). In addition, the company has set a return on equity (ROE) target of 13–15% and established the principle of executing investments only when the ROE exceeds this target.

Furthermore, S-1’s third-quarter consolidated revenue reached 716.7 billion won, a 2.6% increase year-over-year, while operating profit rose 5.3% to 65.4 billion won, posting strong results that exceeded market expectations. The Security division recorded revenue of 356.7 billion won (+3.5% year-over-year) by expanding its portfolio focused on large clients, while the Infrastructure division also showed growth, reaching 356.2 billion won (+1.7% year-over-year), driven by continued growth in real estate service contracts.

HEUNGKUK METALTECH CO.,LTD. projected S-1’s 2026 annual revenue at 28.943 trillion won (up 0.2% year-over-year) and operating profit at 207.8 billion won. The firm further forecast that in 2027, revenue would reach 31.119 trillion won and operating profit 254.2 billion won, indicating an acceleration in profit growth.