Broker: SAC Capital
Date of Report: 23 Oct 2025
Excerpt from SAC Capital report.
- Kim Heng Ltd, a Singapore-based offshore and marine services group, is transitioning from its oil and gas roots to focus on offshore wind and subsea infrastructure, capturing growth in Asia-Pacific’s expanding renewables sector.
- The company reported strong revenue growth in 1H2025, primarily driven by vessel trading and shipbuilding, though margins were pressured by a heavier mix of lower-margin activities.
- Kim Heng’s diversification includes exposure to offshore wind projects in Taiwan and South Korea, alongside legacy marine support and vessel chartering services; this positions the company for multi-year recurring revenue as regional offshore wind investments accelerate.
- The Group leverages its asset-heavy model, with two Singapore shipyards and a fleet of vessels, to maintain operational flexibility and capitalize on both conventional and renewables-driven marine demand.
- Investment catalysts include the execution and expansion of offshore wind contracts, redeployment of chartering fleet, capital recycling through vessel sales, and a potential valuation re-rating as renewables become a larger part of the business.
- Risks include high financial leverage, project execution complexity, cyclicality of offshore demand, exposure to foreign exchange and geopolitical uncertainties, and the challenge of scaling renewables operations.
- Kim Heng trades at a discount to peers on EV/EBITDA multiples, reflecting both opportunities and risks as it navigates its strategic shift towards a hybrid offshore energy services provider.
Above is an excerpt from a report by SAC Capital. Clients of SAC Capital can be the first to access the full report from the SAC Capital website: https://www.saccapital.com.sg
