GL Research: "S Traffic Continues to Expand AFC Business in the U.S."

Reporter Jeon Eun-jung Email: eunsjr@cstimes.com Published: October 24, 2024, 10:31 AM

STraffic Installs Swing-Door Style Barrier Fare Gates at Fort Totten Station in Washington, D.C.

Consumer Times = Reporter Jeon Eun-jeong | Independent research firm GL Research evaluated S Traffic on the 24th, noting that the company is expanding its business to major U.S. cities by successfully winning AFC (Automatic Fare Collection) projects through competitive bidding against Cubic, the number one company in the U.S., and Conduent, the second-largest company.

GL Research analyst Park Chang-yoon stated, "STraffic provides solutions through system integration in various transportation sectors such as roads, railways, and airports. The company is actively exporting transportation systems to overseas markets including the U.S., India, and Bangladesh, in addition to the domestic market."

He continued, "STraffic's AFC system manages fare collection and payment systems for trains, subways, and metros. With experience in replacing the transportation card systems of 277 subway stations in Seoul and managing them under a 10-year contract, the company has successfully won projects in Washington, D.C. (WMATA) and San Francisco (BART), outperforming leading U.S. companies."

Park also noted, "Recently, STraffic was selected as the preferred bidder for the LA Metro New Faregate Pilot project, brightening the prospects for business expansion to major U.S. cities. In particular, the New York MTA is preparing for a large-scale project to replace fare gates at over 470 stations, and STraffic is currently undergoing QPL (Qualified Product List) qualification for this."

Regarding shareholder returns, Park stated, "STraffic maintains a shareholder return rate of 30%, planning to buy back and retire its own shares worth 15 billion KRW over three years. Additionally, the company plans to increase the annual dividend from 40 KRW per share last year to at least 100 KRW, with annual increases of over 20%."

He added, "In the first half of this year, STraffic recorded new orders worth 102.7 billion KRW, achieving 72% of last year's total order amount of 141.7 billion KRW in just six months, with a backlog of orders amounting to approximately 231.8 billion KRW."

Source: Consumer Times (https://www.cstimes.com)