[Click eStock] "INSPien Poised to Benefit as SAP Support Ends... Net Financial Assets Exceed Market Cap"

As the end of support for SAP's legacy enterprise resource planning (ERP) systems approaches, there are growing expectations that INSPien Co., Ltd. (465480) could capture demand for next-generation system transitions. It is currently the leading player in Korea's SAP enterprise application integration (EAI) consulting market, has returned to profitability in the first half of this year, and reportedly holds net financial assets exceeding its market capitalization.

On September 7, independent research firm ValueFinder projected that as the general maintenance support for on-premises SAP ECC draws to a close, related transition demand will accelerate in earnest.

INSPien, founded in 2009 and listed on the KOSDAQ in 2024, is an SAP consulting and security solution development firm. The company has expanded its scope based on SAP systems to encompass system integration consulting (EAI), security solutions, and electronic data interchange (EDI) software-as-a-service offerings.

As of the first half of this year, revenue breakdowns were: consulting business, 32.9%; security solutions, 39.9%; EDI services, 25.3%. The business structure secures stable earnings from existing consulting and security businesses, while fostering EDI as a new growth driver.

In particular, maintenance support for SAP ECC is scheduled to end at the end of 2027. ValueFinder’s analysis indicates that over 90% of existing SAP customers have yet to migrate to the next-generation S/4HANA platform, indicating strong potential for a surge in transition projects going forward.

INSPien is recognized as the market leader domestically in SAP EAI consulting share, giving it a competitive edge in securing transition projects. In the SAP ERP system encryption solutions sector, the company holds a market share of more than 70%, and has over 230 customers.

The security business is also benefitting from regulatory changes that are driving demand. As amendments to the Personal Information Protection Act increase the ceiling on fines and expand the mandatory Information Security Management System–Personal (ISMS-P) certification, companies are expected to continue investing in security solutions.

The growth of the EDI business is also notable. INSPien’s EDI revenue increased from approximately KRW 900 million in 2022 to KRW 3 billion in 2025, with a compound annual growth rate of 51.1%. The cumulative EDI cloud service renewal rate has reached around 97%, reflecting strong customer retention.

Last year, INSPien completed a merger with on-premise EDI specialist B2B C&I, establishing a hybrid EDI business that spans both cloud and on-premise solutions. In July, the company also entered into a partnership with Softlink Global, an Indian logistics IT firm, setting the stage for overseas expansion. INSPien plans to leverage Softlink Global’s network of more than 5,000 logistics firms across some 50 countries to scale its global business.

Financial performance is also improving. INSPien’s revenue for the first half of this year was KRW 8.7 billion, a 13.3% increase from the same period last year. Operating profit swung to positive at KRW 1.24 billion. The operating margin improved by 19.2 percentage points to 14.2%. Security solution sales grew by 33%, while EDI sales surged 170%, driving overall performance.

INSPien’s performance typically follows a trend of weaker first-half results and stronger second-half results, as EAI and security solution implementation projects are usually concentrated in the latter half. Given its return to profitability in the typically off-season first half, analysts expect an even greater improvement in performance in the second half of the year.

Its financial structure is also seen as an attractive investment factor. As of the end of the first half of the year, INSPien’s net financial assets totaled around KRW 38.4 billion. This figure corresponds to 114% of the previous day’s market capitalization of KRW 34.5 billion.

The company is also advancing shareholder return policies. In March, INSPien announced plans to enhance corporate value, with a target dividend payout ratio of over 25%. The dividend payout ratio for the 2025 settlement dividend has already exceeded the target at 37.1%. In addition, the company entered into a trust contract to repurchase KRW 3 billion worth of its own shares, resulting in ownership of 563,951 shares—5.56% of total shares issued—as treasury stock.

Lee Choongheon, a researcher at ValueFinder, stated, "With the imminent end of SAP ECC support, the company, which holds the No. 1 position in domestic EAI consulting, is well-positioned to capture transition demand."

He added, "With net financial assets exceeding its market capitalization and a confirmed return to operating profitability in the first half of the year, expectations are rising for a stock price reevaluation if the company continues to improve its performance and execute its dividend policy, thereby resolving its undervaluation."

INSPien is expected to simultaneously drive improvements in performance and corporate value based on robust cash assets and a return policy for shareholders, alongside increased demand for SAP next-generation system transitions, growth in its security business, and expansion of its EDI business.

This content was produced with the assistance of AI translation services.