Home Capital Broker's Calls

DBS positive on Sembcorp Industries amidst its ‘green transformation’

Chloe Lim
Chloe Lim2/18/2022 12:25 PM GMT+08  • 2 min read
DBS positive on Sembcorp Industries amidst its ‘green transformation’
DBS Group Research has maintained a ‘buy’ rating on Sembcorp Industries (Sembcorp) with an increased target price to $3 from $2.40
Font Resizer
Share to WhatsappShare to FacebookShare to LinkedInMore Share
Scroll to top
Follow us on Facebook and join our Telegram channel for the latest updates.

DBS Group Research analyst Ho Pei Hwa has maintained a ‘buy’ rating on Sembcorp Industries (Sembcorp) with an increased target price to $3 from $2.40, based on a higher price-to-book value (P/BV) multiple of 1.4 times (from 1.2 times previously). The higher target price is also based on a rolled over valuation to FY2022 (from blended FY2021/2022), against 9-10% normalised return on equity (ROE).

“Successful execution of [Sembcorp’s] renewable energy plan, translating into earnings growth, would further lift valuations, writes Ho in his Feb 15 report.

In May 2021, Sembcorp unveiled its strategy to transform its portfolio from brown to green, by focusing on growing renewables and integrated urban solutions businesses. It set quantitative targets to quadruple its renewable portfolio to 10GW by 2025, from 2.6GW of wind and solar capacity in Southeast Asia, India, and China as of end-2020, according to Ho.

For more insights on corporate trends...
Sign In or Create an account to access our premium content.
Subscription Entitlements:
Less than $9 per month
Unlimited access to latest and premium articles
3 Simultaneous logins across all devices
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)
×
Loading next article...
The Edge Singapore
Download The Edge Singapore App
Google playApple store play
Keep updated
Follow our social media
Subscribe to The Edge Singapore
Get credible investing ideas from our in-depth stock analysis, interviews with key executives, corporate movements coverage and their impact on the market.
© 2022 The Edge Publishing Pte Ltd. All rights reserved.
Unlock unlimited access to premium articles with less than $9 per month. Subscribe Now