CGS International Securities
August 11, 2025

Centurion Corporation Ltd: Charting the Next Growth Chapter in Singapore Property Investment

Strong 1H25 Performance and Strategic Growth Initiatives

Centurion Corporation Ltd (CENT) has emerged as a leader in the purpose-built accommodation sector, delivering a robust performance in 1H25 with a core PATMI of S$58 million, marking a 19% year-on-year increase. This growth was fueled by strong rental reversions and resilient occupancy rates, particularly in its Singapore purpose-built worker accommodation (PBWA) portfolio, which achieved an impressive 99% occupancy.
While reported PATMI declined by 38% to S$83 million due to reduced fair value gains on investment properties, core operations remained solid. The PBWA segment saw profit growth of 16% year-on-year, while the PBSA (purpose-built student accommodation) segment experienced a marginal profit decline of 1%—mainly due to foreign exchange headwinds and lower occupancy rates in Australia (down to 91% from 94%) and the UK (normalized to 97% from 99%).

CAREIT IPO Poised to Accelerate Capital Recycling and AUM Expansion

Centurion’s strategic roadmap includes the planned listing of Centurion Accommodation REIT (CAREIT) on the Singapore Exchange Main Board, targeted for completion before the end of FY25. Management has reaffirmed steady progress on this front, positioning CAREIT as an additional platform for capital recycling and asset-under-management (AUM) growth.
IPO proceeds are earmarked for further expansion, with a specific focus on the Australian PBSA segment. Key projects in the pipeline include:

• 644-bed Epiisod-branded asset in Melbourne City, scheduled for 1Q27 completion
• 675-bed site near RMIT University, both expected to be yield-accretive

Centurion remains committed to scaling its accommodation portfolio across six core geographies, with further projects anticipated in both the UK and Singapore.

Industry Tailwinds and Regulatory Reforms Underpin Positive Outlook

Centurion benefits from favorable supply-demand dynamics and regulatory reforms in migrant housing, especially in Singapore and Malaysia. The Ministry of Manpower’s New Dormitory Standards (NDS)—mandating higher living standards such as a maximum of 12 residents per room, minimum living space per resident, increased privacy, and en-suite facilities—position Centurion’s assets as industry benchmarks.
Notably, Westlite Ubi, launched in December 2024, is among the first privately-owned dormitories in Singapore to comply with NDS, well ahead of the 2040 deadline. This facility features:

• Ensuite kitchens with refrigerators and washing machines
• On-site amenities including a minimart, canteen, barber, multi-purpose hall, and gym
• 100% occupancy across its 1,650 beds by April 2025

Similar NDS-compliant developments are planned for Westlite Toh Guan, expected to complete in 4Q25.

Financial Highlights and Performance Metrics

Key changes in this report include a 5-10% increase in FY25-27F core EPS, attributed to higher associate/JV income, lower tax rate assumptions, and the inclusion of 1,716 new beds from Westlite Mandai’s redevelopment in FY27.

Peer Comparison: Centurion vs Sector Leaders

Centurion trades at an attractive forward P/E and maintains strong dividend yields compared to sector peers. The company’s focus on capital recycling and AUM growth positions it for further upside.

ESG and Regulatory Compliance: Enhancing Quality and Sustainability

Centurion’s business model emphasizes centralized, high-quality accommodations for workers and students. Recent regulatory changes in Singapore and Malaysia are driving industry-wide upgrades, and Centurion has moved proactively, already complying with Malaysia’s latest standards since January 2022 and planning Asset Enhancement Initiatives (AEIs) in Singapore.
Beyond regulatory compliance, Centurion runs an active calendar of social events for residents, enhancing well-being and creating holistic residential experiences. The company’s electricity and water intensity have remained relatively stable, though greater initiatives for renewable energy adoption are recommended moving forward.

Balance Sheet Strength and Key Financial Ratios

Centurion’s prudent financial management is reflected in improving net gearing, robust operating margins, and strengthening interest cover metrics.

Growth Drivers: Bed Capacity and Occupancy Trends

• PBWA Malaysia bed capacity: 28,923 (steady from 2024–2027)
• PBWA Singapore bed capacity: Growing from 36,436 in 2024 to 39,252 in 2027
• PBSA Australia bed capacity: Expanding from 911 in 2024 to 2,273 in 2027
• Occupancy rates: PBWA Singapore at 100%, PBWA Malaysia at 80–90%, PBSA UK and Australia at or near 90–100%

Valuation: RNAV and Target Price

Centurion’s target price is derived using a 20% discount to its RNAV, aligning with local hospitality REITs trading at 0.8x P/RNAV. The calculated RNAV per share is S$2.57, with a target price of S$2.05, representing a 21.3% upside from the current price of S$1.69.

Recommendation Framework and Analyst Coverage

CGS International maintains an “Add” rating on Centurion, reflecting expectations of sustained growth, regulatory tailwinds, and effective capital recycling. The stock’s total return is projected to exceed 10% over the next 12 months. Major shareholders include Centurion Properties Pte Ltd (50.6%), David Loh Kim Kang (9.2%), and Teo Peng Kwang (7.6%).

Conclusion: Centurion Positioned for Sustainable, Yield-Accretive Growth

Centurion Corporation stands out in the Singapore property investment landscape for its commitment to regulatory compliance, resident well-being, and capital-efficient growth. With the CAREIT IPO on track, robust financial metrics, and a pipeline of yield-accretive projects, Centurion is well placed to capture sector tailwinds and deliver long-term value to shareholders.

Disclaimer

This article is for informational purposes only. Investors should evaluate their individual investment objectives and consult professional advisers before making investment decisions.