CGS-CIMB Research has maintained its ‘add’ rating for Sembcorp Industries with an unchanged target price of $1.97 after the company announced it had been awarded with a 60 megawatt-peak (MWp) solar project by the Housing Development Board (HDB) and the Economic Development Board (EDB).

CGS-CIMB analyst Lim Siew Khee notes that the new project boosts Sembcorp’s solar power capacity in Singapore to a total of 362.3 MWp or 302 megawatts (MW), making it the leading solar energy provider in Singapore. In comparison, Sunseap Group’s solar power capacity stands at around 300 MWp (as of May 2020).


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She also notes that Sembcorp currently has a total solar power capacity of 756 MW which includes 302 MW in Singapore, 435 MW in India, and 17 MW in Vietnam. Sembcorp’s solar capacity in India was boosted by the 400 MW project in Rajasthan, India which it won in January. 

Overall, Lim is positive on Sembcorp’s strong regional presence in the renewable energy space, with a total portfolio capacity of 3.2 gigawatts spanning solar, wind, and energy storage. 

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“Sembcorp is keen to shift its current renewable/thermal mix of 40/60 net profit contribution in the medium term. We continue to like Sembcorp for its strong regional presence in the renewable energy space as well as its firm commitment to sustainable power generation,” she says.


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Her target price of $1.97 remains based on a 2021 P/BV ratio of 1 time. She highlights that Sembcorp currently trades at 0.87 times P/BV, which is cheaper compared to other regional power or utility companies at around 1.6 times

As at 12.19pm, shares in Sembcorp are up 1 cent or 0.55% higher at $1.82.