In today’s briefing:
- Sembcorp Marine (SMM SP): Short-Term Share Overhang Vs the Long-Term Value
- Deep-Dive 2023-3: Boustead Singapore (BOCS SP)
Sembcorp Marine (SMM SP): Short-Term Share Overhang Vs the Long-Term Value
- The transaction completes on 28 February and the distribution in-specie of 49% new Sembcorp Marine (SMM SP) shares will be credited to Keppel Corp (KEP SP)‘s shareholders on 1 March.
- While the potential index inclusions are likely to support new SMM shares, there is likely to be greater short-term downward pressure from the overhang created by the distribution in-specie.
- New SMM trades at a premium P/NAV multiple of 1.81x vs peers. However, New SMM’s order book of S$18.1 billion implies an undemanding EV/order book of 0.60x vs historical ranges.
Deep-Dive 2023-3: Boustead Singapore (BOCS SP)
- The company was founded in 1828 as a British trading house, active across rubber plantations, tin smelting, trading of oil products, shipping, distribution of consumer goods and more.
- After Singapore become an independent country, Boustead Singapore was spun off from its Malaysian and British counterparts.
- In 1996, the company became controlled by entrepreneur FF Wong.
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