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Singapore Post - OCBC Investment 2022-03-02: Benefiting From Strong E-commerce Growth

SINGAPORE POST LIMITED (SGX:S08) | SGinvestors.io SINGAPORE POST LIMITED (SGX:S08)

Singapore Post - Benefiting From Strong E-commerce Growth

  • SingPost's 3QFY22 revenue rose 24% y-o-y and 15% q-o-q.
  • Beneficiary of border reopening and strong e- Commerce demand.
  • International PP business impacted by COVID-19 disruptions.



SingPost's 3QFY22 business update

  • SingPost (SGX:S08)’s 3QFY22 revenue rose 24% y-o-y or 15% q-o-q to S$437m, largely attributable to the consolidation of Freight Management Holdings (FMH), and growth from eCommerce logistics and Famous holdings. Operating expenses rose 23% y-o-y, due to higher volume related expenses in line with higher freight forwarding and eCommerce logistics volume, and the absence of S$6.1m of Jobs Support Scheme. As a result, SingPost's group operating profits rose 46% y-o-y or 20% q-o-q to S$38m in the quarter.


Strong eCommerce logistics growth

  • For the domestic Post & Parcel segment (DPP), volume fell 5% y-o-y in 3QFY22, and continued to be dragged by domestic letters and printed papers due to electronic substitution. The decline was partially offset by stronger domestic eCommerce logistics volume (+50% y-o-y) during the year-end peak shopping season and one-off nationwide distribution projections such as for ART kits and mouth gargles.
  • Separately, international PP’s volume fell 21% y-o-y, impacted by air freight capacity and conveyance costs due to the COVID-19 disruptions, but partially offset by stronger freight forwarding business. Moreover, following SingPost’s acquisition of FMH to accelerate its investment in Australia, consignment volume in Australia increased 7% y-o-y in 3QFY22.


Undemanding valuations






Chu Peng OCBC Investment Research | https://www.iocbc.com/ 2022-03-02
SGX Stock Analyst Report BUY MAINTAIN BUY 0.780 SAME 0.780



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