Broker: Maybank Research Pte Ltd
Date of Report: August 17, 2025
CSE Global Poised for Multi-Year Growth: Data Centres, Utilities, and ESG Drive Bullish Outlook
Overview: Robust Performance Sets the Stage for Expansion
CSE Global (CSE SP), a global systems integrator headquartered in Singapore, has delivered a solid 1H25 performance with notable improvements in both gross and net margins. The company continues to ride the upcycle in electrification, oil & gas, infrastructure, and especially data centres, positioning itself for accelerated growth in the second half of 2025 and beyond.
Broker Rating: BUY (Target Price SGD 0.84, +36% upside)
Current Share Price: SGD 0.65
Market Capitalisation: SGD 455.9M
Dividend Payout Policy: 50%
Half-Year Financial Performance: Margins and Revenue Climb
CSE Global’s 1H25 net profit after tax (NPAT) reached SGD 16.3m, marking an 8.5% year-on-year increase. This result was achieved despite a 10% depreciation of the USD against SGD, underlining management’s operational efficiency.
Key highlights include:
Gross margin: 27.9% (up from 27.6% YoY)
Net margin: 3.7% (up from 3.5% YoY)
Revenue: SGD 440.9m (2.8% YoY growth)
Orderbook: SGD 573.8m (expected to rise in 2H25 with larger project wins)
Interim dividend: 1.14 SGD cents declared
Strategic Focus: Data Centres Lead Orderbook Growth
CSE made a decisive move to reserve capacity and concentrate efforts in the data centre and utility segments. Recent order wins reflect this strategy:
August 2025: SGD 59m data centre extension order from a US hyperscaler client (previous orders: SGD 20+m three years ago, SGD 49m in April 2024).
Contract sizes and frequency of wins are accelerating, with management bullish about further qualification with 1-2 additional hyperscalers.
A successful qualification would drive significant earnings growth for FY26-FY28.
Capacity Expansion: Ambitious Plans Through 2028
CSE Global plans to aggressively expand its US capacity, aiming to more than triple production by 2027/28. This strategy is underpinned by anticipated large-scale data centre orders and a stable 50% dividend payout policy, ensuring shareholder value and stability.
Shareholder and Market Data
| Shareholder |
Ownership (%) |
| Heliconia Capital Management Pte Ltd |
22.6% |
| CSE Global Ltd. |
4.4% |
| Fidelity Management & Research Co. LLC |
4.1% |
Financial Performance and Forecasts
| Metric |
FY23A |
FY24A |
FY25E |
FY26E |
FY27E |
| Revenue (SGD m) |
725 |
861 |
913 |
977 |
1,046 |
| EBITDA (SGD m) |
63 |
82 |
67 |
71 |
76 |
| Core Net Profit (SGD m) |
23 |
26 |
35 |
39 |
43 |
| Core EPS (SGD cts) |
3.7 |
3.7 |
5.0 |
5.5 |
6.1 |
| Net DPS (SGD cts) |
2.8 |
2.4 |
2.5 |
2.8 |
3.0 |
| Core P/E (x) |
11.7 |
11.1 |
12.9 |
11.7 |
10.7 |
| Net Dividend Yield (%) |
6.4 |
5.8 |
3.9 |
4.3 |
4.7 |
| ROAE (%) |
10.5 |
11.2 |
12.9 |
12.5 |
12.2 |
Value Proposition: Growth Drivers and Competitive Advantages
– CSE Global offers integrated systems solutions globally, serving energy, infrastructure, and mining sectors. – The company trades at a significant discount to peers, offering attractive re-rating potential. – Strong order book supports multi-year growth, backed by rising demand in public infrastructure and data centres. – Prospective dividend yield remains attractive above 3.7%.
Key Upside and Downside Factors
Upside:
- Strong data centre segment growth could re-rate share price
- Potential for further mergers & acquisitions to boost earnings
- Attractive dividend yield supports shareholder returns
- Exposure to US oil & gas upcycle
- Continued order momentum in US data centres
Downside:
- Execution risks, including cost overruns
- Macroeconomic shocks or recession slowing orders
- Foreign exchange volatility impacting profitability
ESG Performance: Above-Average Rating, Ambitious Targets
CSE Global has implemented comprehensive ESG strategies, scoring 76 (above average) on the broker’s ESG matrix.
Environmental: Focus on reducing greenhouse gas emissions and paper consumption; investments in green technologies including LED lighting and solar power.
Social: Efforts to foster workplace diversity, flexible arrangements, and community engagement (e.g., donations to Yellow Ribbon Singapore, bursaries for employees).
Governance: Robust policies include a whistle-blowing mechanism, 25% female board representation, and zero tolerance for fraud and corruption.
| ESG Metric |
2021 |
2022 |
2023 |
| Scope 1 Emissions (tCO2e) |
2,234 |
2,720 |
2,298 |
| Scope 2 Emissions (tCO2e) |
2,415 |
2,447 |
2,363 |
| GHG Intensity (tCO2e/million hours) |
9.90 |
9.30 |
6.40 |
| % Women in Workforce |
14.0% |
15.0% |
16.6% |
| Female Board Members |
22% |
25% |
22% |
Long-term target: Reduce greenhouse gas CO2 index by 10% by 2030 (not yet achieved)
Paper reduction target: 1% annually (met in FY22)
Zero confirmed incidents of corruption and non-compliance
Balance Sheet Strength and Liquidity Overview
| Metric |
FY23A |
FY24A |
FY25E |
FY26E |
FY27E |
| Cash & Short Term Investments (SGD m) |
39.4 |
57.4 |
101.8 |
119.2 |
131.2 |
| Total Assets (SGD m) |
599.6 |
632.6 |
665.7 |
703.7 |
746.2 |
| Total Liabilities (SGD m) |
383.6 |
376.6 |
374.4 |
373.4 |
373.0 |
| Shareholder Equity (SGD m) |
216.1 |
256.0 |
291.3 |
330.3 |
373.2 |
Liquidity, Efficiency, and Leverage Ratios
- Cash conversion cycle improving to 5.4 days (FY27E)
- Net gearing set to reach net cash by FY26E/FY27E
- Current ratio improving from 1.2x to 1.5x over forecast period
- Dividend cover rising to 2.0x
Investment Ratings and Historical Recommendations
– CSE Global has consistently received BUY recommendations, with target prices rising from SGD 0.6 to SGD 0.8 over the last two years. – The company is viewed as offering above-market returns (>10%) in the next 12 months, including dividends.
Conclusion: CSE Global’s Outlook Remains Strong
With a proven strategy focused on high-growth sectors, disciplined execution, and a commitment to sustainability, CSE Global is well-positioned for multi-year expansion. Investors can expect continued margin improvement, robust order flows from hyperscaler clients, and a stable dividend policy, making the company an attractive proposition in the global systems integration space.
Key growth drivers: Data centre expansion, US capacity build-out, electrification, and infrastructure trends.
Risks: Execution missteps, FX volatility, economic downturns.
ESG: Above-average framework with room for improvement in quantitative metrics.
Contact Information and Coverage
Maybank Research Pte Ltd maintains active coverage of CSE Global, alongside comprehensive sectoral analysis across ASEAN and key global markets.
Disclaimer
The information provided is for general informational purposes and does not constitute investment advice. Investors should consult with financial professionals before making investment decisions.
