Broker Name: CGS International
Date of Report: March 5, 2026
Excerpt from CGS International report.
Report Summary
- CGS International maintains its positive view on Keppel Infrastructure Trust (KIT), with an “Add” rating and a target price of S\$0.60, seeing limited financial impact from ongoing Middle East conflicts.
- KIT’s income from its minority stake in Aramco Gas Pipelines Company (AGPC) is protected by a minimum 80% volume clause until contract expiry in 2042, insulating it from current regional disruptions.
- Potential cost increases at City Energy and Ixom are either recoverable or can be passed through, minimizing margin risks; other key assets have tolling or hedging agreements limiting downside.
- Financial forecasts for FY26-28 remain unchanged; the trust’s diversified portfolio and built-in risk mitigants support stable performance and attractive dividend yields (~7.7%).
- Key risks include a significant drop in Aramco pipeline throughput below 80%, unfavorable weather, or policy changes, but no immediate operational or financial threat is identified from the current Middle East situation.
- Peer comparison shows KIT trades at reasonable valuations with strong dividend yield versus local and regional infrastructure peers.
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.cgs-cimb.com
