Boustead Singapore - CGS-CIMB Research 2021-03-17: Set For Another Good Year

BOUSTEAD SINGAPORE LIMITED (SGX:F9D) | SGinvestors.io BOUSTEAD SINGAPORE LIMITED (SGX:F9D)

Boustead Singapore - Set For Another Good Year

  • Completion of Boustead Project’s (52.8%-owned subsidiary) value unlocking exercise could translate into special dividend being declared by Boustead Singapore, in our view.
  • Strong earnings momentum to continue in 2HFY21. Excluding disposal gains, we forecast FY21F core net profit of S$49.4m (+35% y-o-y).
  • Reiterate ADD on Boustead Singapore with higher target price of S$1.40.



Value unlocked; we see potential for special dividend from Boustead Singapore


Boustead's strong earnings momentum to sustain in 2H21F

  • Excluding the disposal gains, we forecast Boustead Singapore to record core net profit of S$24.2m in 2HFY21 (Oct 2020 to Mar 2021), bringing full-year core net profit to S$49.4m (+35% y-o-y).
    • Underpinned by government agencies’ increasing use of smart mapping technologies to combat COVID-19 (vaccination roll-out, contact tracing, etc.), we forecast geospatial technologies segment PBT to grow 31% y-o-y to S$38m in FY21F.
    • We forecast energy-related engineering segment to see PBT grow four-fold y-o-y to S$32.9m in FY21F, leveraging its strong order book of S$203m (as of end-1H21).
    • Meanwhile, property segment should also return to profitability on the back of resumption of construction activities in Singapore, and strong leasing activities.


Reiterate ADD on Boustead Singapore with higher target price of S$1.40






ONG Khang Chuen CFA CGS-CIMB Research | https://www.cgs-cimb.com 2021-03-17
SGX Stock Analyst Report ADD MAINTAIN ADD 1.40 UP 1.200



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