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FY18 to remain a ‘year of transformation’ for SingPost

Michelle Zhu
Michelle Zhu3/16/2017 11:21 AM GMT+08  • 2 min read
FY18 to remain a ‘year of transformation’ for SingPost
SINGAPORE (March 16): UOB Kay Hian is maintaining its “hold” recommendation on Singapore Post (SingPost) with a target price of $1.46 as FY17 draws to a close, on the notion that FY18 will remain a “year of transformation” for the group where elev
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SINGAPORE (March 16): UOB Kay Hian is maintaining its “hold” recommendation on Singapore Post (SingPost) with a target price of $1.46 as FY17 draws to a close, on the notion that FY18 will remain a “year of transformation” for the group where elevated costs will continue to dampen its earnings.

In a Thursday report, analysts Thai Wei Ying and Andrew Chow say that while they are still positive on SingPost’s long-term prospects, investors are to expect TradeGlobal losses to continue in FY17 due to a revenue gap from losses incurred in 3Q17, as well as cost pressure.

At the same time, they remain cautiously optimistic that losses will nonetheless taper off in FY18, on measures such as warehouse automation and new customer onboarding/fulfilment efforts to restructure TradeGlobal. “Furthermore, we note Paul Demirdjian, the newly-appointed interim CEO of the US business, is equipped with strong e-commerce experience,” say Thai and Chow.

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