CSE Global (SGX: 544) – Electrification Business Boosts Outlook
- Recommendation: BUY
- Target Price: SGD 0.64
- Date of Recommendation: September 8, 2024
- Broker Company: Maybank Research Pte Ltd
Investment Thesis:
CSE Global is experiencing rapid growth, especially through its U.S.-based electrification business, Volta, catering to data centers, LNG terminals, and EV-charging infrastructure. The company’s existing facilities are set to expand, and it expects a continued surge in contracts.
Key Growth Drivers:
- Expansion of Facilities: Volta’s data center space is expected to grow from 40,000 sq. ft. to 75,000 sq. ft. in 2025, driven by demand from major cloud providers.
- Strong Demand: The growing need for data centers and electrification solutions, particularly in the U.S., ensures a multi-year upcycle for CSE Global.
- Revenue Growth: CSE Global’s revenue is projected to grow by 17.7% in FY24E and 18.5% in FY25E, with earnings showing strong momentum.
Valuation and Catalysts:
CSE Global is valued at a P/E ratio of 11.0x for FY24E, with a dividend yield of 5.9%, offering an attractive investment for those seeking growth and income. The strong order book and potential M&A opportunities further enhance its long-term outlook.
This report suggests that CSE Global’s focus on electrification and infrastructure solutions positions it well for future growth, making it a strong BUY recommendation.
Thank you
