IBK Investment Securities initiated coverage of SPG (KOSPI: 058610) on the 20th with a "Buy" recommendation and a target price of 100,000 won. Based on the stock's closing price of 66,000 won on 16th July, this implies upside potential of 51.5%.
SPG's core products are fan motors for home appliances and geared motors for industrial automation, which account for roughly 65% and 30% of revenue respectively. The company's precision reducer business — components used to control the speed and torque of robotic joints — is expected to grow from 4% of revenue in 2025 to around 10% by 2027.
IBK Securities described SPG as "the only domestic company with a full product line-up of precision reducers for humanoid robots." The company is the sole supplier of precision reducers across the entire range of collaborative robots, dual-arm robots, and quadruped robots manufactured by Rainbow Robotics, a South Korean robotics firm in which Samsung has a significant stake.
Revenue from Rainbow Robotics is forecast to reach 16 billion won in 2027, roughly double the prior year's level. Approximately 1,000 quadruped robots destined for South Korea's defence sector are scheduled for shipment, each equipped with 12 precision reducers.
SPG is also developing a robotics actuator product — the SDD (SPG Direct Drive) — that integrates a reducer, motor, and controller into a single unit. Following the company's participation in North America's largest automation trade fair in June, it is in discussions with multiple American firms over non-disclosure agreements as a precursor to potential supply deals, with full-scale mass production expected from October onwards.
For the second quarter, revenue is forecast at 91.1 billion won, up 13.3% year on year, with operating profit of 5.2 billion won, a rise of 32.9%. The operating margin is expected to come in at 5.7%.
On an annual basis for 2026, SPG is projected to generate revenue of 363 billion won (up 6.2%) and operating profit of 22.3 billion won (up 24.2%). Precision reducer sales are estimated to reach 21.1 billion won, a 53.2% increase on the previous year.