Daily Brief Singapore: Sheng Siong, PingSafe, Singapore Post, XP Power Ltd and more

• Sheng Siong (SSG SP) reported another resilient quarter with revenue growth at 4.7% YoY and profit growth flat, with annualized ROCEs at 27%. 
• Net cash grew to 289 mn SGD (highest ever now at 12% of market capitalization). The company is expected to expand by 3-4 stores in FY23 for Singapore.
• While the stock is not cheap at 19x/18x FY23e/FY24e and 3.8% dividend yield, we see prospects for margin expansion in further quarters as execution remains high quality.

• PingSafe, a Singapore-based cybersecurity firm, has raised US$3.3 million in a seed funding round led by Surge, the scale-up program of Peak XV Partners (formerly Sequoia Capital India & SEA). The round also saw participation from Tanglin Ventures and several angel investors.
• The company will use the fresh funds to expand its business across Southeast Asia and North America.
• Founded in 2022 by CEO Anand Prakash and CTO Nishant Mittal, PingSafe provides a cloud security platform that protects companies’ data and apps from cyber attacks.

XP Power reported year-on-year revenue growth of 30% in H123 as it made good progress shipping from its elevated backlog. As expected, orders declined year-on-year, but the c £250m backlog still provides at least nine months’ revenue visibility. The company continues to invest for the longer term in Malaysia (manufacturing) and the United States (R&D). With no change to management’s full year expectations, we maintain our normalised operating profit forecasts for FY23 and FY24 and nudge up our interest cost forecast for FY23.