Singapore Post Ltd: Unlocking Value Through Asset Monetization

Maybank Research Pte Ltd | March 10, 2025

Significant Special Dividends on the Horizon

Singapore Post Ltd (SingPost) is poised to deliver substantial returns to its shareholders through a series of asset sales and special dividends. After the company received approval from the Australian Commonwealth Treasury to sell its Australian student accommodation business, the market expects the sale of SingPost’s other Australian assets to be concluded by the end of March 2025. Additionally, the divestment of its Famous Holdings subsidiary is also expected to be finalized within the next two months. [[1]]

As a result of these asset sales, the research report estimates that SingPost could have around SGD400-450 million in excess cash, which the company is expected to distribute as special dividends to shareholders. This translates to potential special dividends of SGD0.12-0.15 per share, even without the sale of Famous Holdings. The special dividends are likely to be announced along with SingPost’s full-year results in May. [[1]]

Restructuring the Singapore Postal Business

The report notes that SingPost’s Singapore postal business has been recording operating losses due to lower revenues and high costs of operating the postal network. To address this, the company is expected to make adjustments to some post office locations and explore rate hikes to ensure the postal services remain cost-effective. The researchers believe that the right-sizing of outlet locations will likely be carried out after the upcoming general elections. [[2]]

Focusing on Asset Monetization

While the report acknowledges the ongoing challenges faced by SingPost’s international and Singapore businesses, the key investment thesis lies in the asset monetization angle and the potential for special dividends. The researchers advise shareholders to remain patient while awaiting the closure of the Australian business sale and any further asset sales, as the rewards should come in the form of significant special dividends. [[2]]

Valuation and Recommendation

The research report maintains a “BUY” rating on SingPost with an unchanged price target of SGD0.77, representing a potential upside of 38% from the current share price of SGD0.56. The analysts believe that the asset monetization and special dividend payouts will be the primary drivers of value for the company in the near future. [[1]]