Broker: CGS International
Date of Report: October 31, 2025
Excerpt from CGS International report.
Report Summary
- Keppel Ltd is undergoing transformation, focusing on asset management, infrastructure, and decarbonisation, with expected significant earnings growth through FY26-FY27.
- The market is closely watching for a potential special dividend payout from the M1 divestment, which could be S\$0.22-0.27 per share (40-50% of proceeds), raising FY25F dividend yield to 5.1-5.6% or higher.
- The company has completed S\$2.4bn in asset monetisations year-to-date 2025 and targets S\$10-12bn by 2026 (excluding M1).
- Key drivers for future growth include new infrastructure projects (like the 600MW Sakra plant), fund management expansion, and digital connectivity ventures such as a floating data centre.
- Keppel’s new structure excludes legacy and non-core assets, which are being divested; these accounted for S\$4.8bn in book value as of 1H25.
- Consensus remains positive with a 26.4% upside to the new target price of S\$12.71, based on 18x FY27F P/E plus non-core assets at book value.
- Keppel has made strong progress in ESG, holding an AAA MSCI ESG rating and actively divesting carbon-intensive businesses as part of its Vision 2030 strategy.
- Risks include slower asset monetisation and potential operational issues, but catalysts like strong Sakra plant results and further asset sales could drive re-rating.
Above is an excerpt from a report by CGS International. Clients of CGS International can be the first to access the full report from the CGS International website : https://www.cgsi.com/
