Broker: Maybank Research Pte Ltd
Date of Report: August 17, 2025

CSE Global: Poised for a Multi-Year Growth Cycle with Robust Order Wins and Expanding Data Centre Exposure

Executive Summary: CSE Global Positioned for Stronger 2H25 and Beyond

CSE Global (CSE SP), a leading provider of integrated systems solutions across the Energy, Infrastructure, and Mining & Minerals sectors, is at the cusp of a multi-year upcycle. With strategic pivots to high-growth markets such as data centres and utilities, a strengthening order book, and an aggressive capacity expansion plan, CSE is gaining momentum. Maybank Research maintains a BUY rating with a target price (TP) of SGD0.84, representing a potential 36% upside from the current share price of SGD0.65.

1H25 Performance: Margins Expand Amid Revenue Growth

CSE Global delivered a solid set of results for 1H25, reporting a net profit after tax (NPAT) of SGD16.3 million, up 8.5% year-on-year. This performance was achieved despite a 10% depreciation in the USD against SGD, underlining the group’s operational resilience. Gross and net margins improved to 27.9% and 3.7%, respectively, from 27.6% and 3.5% in the previous year. Revenue for the period increased by 2.8% YoY to SGD440.9 million.
The company declared an interim dividend of 1.14 SGD cents, adhering to its 50% payout policy, reinforcing its commitment to shareholder returns.

Orderbook and Dividend: Stability and Growth

Remaining order book as at June 30, 2025 stood at SGD573.8 million.
The interim dividend of 1.14 SGD cents reflects a consistent 50% pay-out policy.
No changes to earnings forecasts at this juncture.

Data Centre Growth: Strategic Wins and Expanding Client Base

CSE Global’s focus on high-growth data centre and utility sectors continues to bear fruit. In August 2025, CSE secured a SGD59 million extension order from an existing US hyperscaler client. This marks a substantial increase from its initial data centre order of over SGD20 million three years ago, followed by a SGD49 million order in April 2024, and now the SGD59 million award. The trend of increasing contract sizes and speed of wins is expected to continue.
CSE is also in advanced qualification stages with 1-2 additional hyperscaler clients. Securing these accounts could significantly boost earnings for FY26-28.

Capacity Expansion: Tripling in the US by 2027-28

CSE Global is preparing for a major step-up in capacity, especially in the US. Management expects to more than triple its current capacity by 2027/28 to meet surging demand, particularly from larger data centre projects. This expansion, if realized, will provide the backbone for a multi-year growth trajectory.

Share Price Performance and Valuation Metrics

CSE Global’s share price closed at SGD0.65, with a 12-month target price of SGD0.84 (+36% upside). The stock has delivered robust returns, outperforming the Straits Times Index over multiple periods.

Valuation is attractive, with CSE trading at a significant discount to peers. Prospective dividend yield stands at 3.7%, and core P/E is expected to range from 10.7x to 12.9x through FY27.

Financial Highlights: Key Metrics and Forecasts

Value Proposition and Strategic Positioning

CSE Global is a global systems integrator benefiting from trends in electrification and oil & gas upcycles.
Strong order book provides forward visibility and underpins the growth story.
Dividend yield is attractive compared to peers, with a consistent pay-out track record.
CSE trades at a notable discount to sector peers, offering value and potential for a share price re-rating.

Key Upside and Downside Risks

Upside Catalysts:

• Further strong order wins from data centre and US O&G sectors
• Trading at a significant discount to peers could prompt a re-rating
• Attractive dividend yield and potential for further M&A activity
• Operating leverage from capacity expansion in the US

Downside Risks:

• Execution risk on large projects may lead to cost overruns
• Macroeconomic recession could impact order flow and business momentum
• FX volatility could affect reported profitability due to CSE’s global footprint

ESG Analysis: Above-Average Commitment, More Progress Needed

CSE Global has placed increased emphasis on sustainability, with ongoing efforts to reduce carbon emissions and digitize operations. The company is using TCFD roadmaps, pursuing Sustainability Linked Loans, and has made progress in reducing its paper consumption index. However, carbon emission reduction targets have not yet been met, and further work is needed in both environmental and social dimensions.

ESG overall score: 76 (above average).
Board comprises 8 directors, 25% of whom are female.
CSE is committed to achieving a 10% reduction in greenhouse gas CO2 index by 2030, but no progress as of 2023.
Paper consumption index has seen consistent annual reduction, meeting the company’s target.
Zero confirmed incidents of corruption or non-compliance in recent years.

Balance Sheet and Cash Flow: Strengthening Fundamentals

CSE Global’s balance sheet remains robust, with net gearing falling sharply and the group expected to be in a net cash position from FY26 onwards. Free cash flow generation is strong, enabling both dividend payments and reinvestment for growth.

Conclusion: Multi-Year Growth and Shareholder Value Creation

CSE Global stands at an inflection point, with the next phase of growth expected to be driven by significant wins in the data centre segment, aggressive capacity expansion, and a robust order book. The company’s financial strength, attractive dividend yield, and commitment to sustainability make it a compelling pick for investors seeking exposure to global systems integration and digital infrastructure growth. Maybank Research reiterates its BUY rating and SGD0.84 target price, signaling confidence in CSE Global’s multi-year growth story.