The app lets you use system features that are normally not available for regular apps. Basically it runs a service which has access to some System API's that can be granted to regular apps so think of it like you would have root without having root.
For the project as a whole, it is not free. You are FORBIDDEN to distribute the apk compiled by you (including modified, e.g., rename app name "Shizuku" to something else) to any store (IBNLT Google Play Store, F-Droid, Amazon Appstore etc.).
Redistributing modifications or otherwise modifying, improving and sharing software isn't stealing...
Their "exception" basically defeats the point of the free license it uses (Apache2.0). It's more source-available than libre or open source, thinly veiled by the Apache license at the top of the project. I find it interesting that they chose a free license to base it on in the first place if they then go on to invalidate a good chunk of it's user protections.
If they really don't want people to pass off other work as theirs, they could have just used the 4-clause BSD license, with it's advertising clause, or Apache 1.0, also with an advertising clause (not great for libre licenses, but would fit and wouldn't be quite so bad as what they've done).