Next month, Satrec Initiative is anticipating improved performance based on the expansion of its satellite imagery service business ahead of the launch of its 0.3m class ultra-high-resolution satellite. Satrec Initiative is the only corporation in South Korea with a history of exporting satellite systems and was acquired by Hanwha Group in 2021. Currently, it plays a key role in the group's space business oversight organization, 'Space Hub,' alongside Hanwha Aerospace and Hanwha Systems.
According to industry sources on the 11th, Satrec Initiative plans to launch its self-developed optical satellite SpaceEye-T into orbit using a SpaceX rocket next month. SpaceEye-T is a 0.3m class ultra-high-resolution commercial Earth observation satellite developed by Satrec Initiative in collaboration with Space Hub. The resolution of 0.3m means that the satellite can recognize a 30cm by 30cm area on the ground as a single pixel. A lower resolution number indicates clearer image quality for satellites.
The 0.3m class optical satellite possesses technology that can only be found among some satellite powers such as the United States, France, and Israel, allowing for clear identification of people on the ground from space. Although satellites with superior performance are currently used for military purposes, fewer than 10 satellites are known to be in use in the commercial satellite sector.
Satrec Initiative has steadily increased its revenue but has recorded losses for three consecutive years: -7.7 billion won in 2022, -4.4 billion won in 2023, and -3.1 billion won in 2024. The decline in profitability has largely been due to the underperformance of its subsidiaries, SIIS and SIA, which focus on satellite image sales and analysis, respectively. Analysts estimate that with the launch of SpaceEye-T this year, Satrec Initiative will generate more than 10 billion won in operating profit and transition to profitability. After the launch in March, SpaceEye-T is expected to undergo an optimization process in the first half of the year and begin full-scale imaging services in the second half.
Satrec Initiative's subsidiary SIIS currently exports satellite images to approximately 160 countries through the image sales rights of South Korea's multi-purpose practical satellites (Arirang) No. 2, 3, 3A, and 5, which are being developed and operated by the government. There are expectations that new demand will arise once SpaceEye-T is in orbit.
Currently, the satellite imaging market is dominated by Maxar Technologies in the United States and Airbus in Europe, which account for 42% of the total, generating annual revenues in the hundreds of billions of won. While these companies offer satellite resolutions similar to that of SpaceEye-T, the price of SpaceEye-T's products is said to be about one-third lower.
The satellite image analysis solution business of Satrec Initiative's subsidiary SIA is also expected to enter an expansion phase. SIA utilizes its developed artificial intelligence (AI) system to detect changes in images obtained from satellites and automatically produces analysis reports for military and intelligence agencies both domestically and abroad. Research Institute Lee Jun-seok of Hanyang Securities noted, "While satellite images captured at 1m resolution are sometimes distributed for free, the demand for 0.3m resolution images from the government or military is substantial. There is an imbalance between supply and demand, leading to relatively high prices."