Broker Name: CGS International Securities
Date of Report: January 23, 2026
Excerpt from CGS International Securities report.
Report Summary
- Singapore’s Building and Construction Authority (BCA) raised its 2026 construction demand forecast to S\$47bn-53bn, supporting an extended upcycle and pushing expected earnings peaks to FY28F/29F.
- The sector is expected to see robust contract awards, driven by mega public projects such as Changi Airport Terminal 5 and Marina Bay Sands Integrated Resort 2, with over S\$13bn in contracts still to be awarded.
- CGS International maintains an Overweight rating on the Singapore construction sector, forecasting FY26F-28F EPS growth of 16-41% and ROE of 16-24% for covered companies.
- Top picks are Sanli Environmental, Soilbuild Construction, and Tiong Woon Corp, all with significant upside potential based on current valuations and strong order books.
- The construction upcycle is expected to be sustained by a diverse pipeline, including institutional, commercial, and civil engineering projects, plus future initiatives such as coastal protection and new MRT lines.
- Much of the mega project work, while awarded to overseas consortiums, is expected to be subcontracted to local players, benefiting Singapore-listed construction and materials firms.
- Key re-rating catalysts include strong project win momentum and earnings-accretive M&As, while downside risks include project delays and work stoppages.
- Sector players are investing in ESG and technology adoption, which can improve safety, efficiency, and sustainability, further supporting their competitive positioning in public tenders.
Above is an excerpt from a report by CGS International Securities. Clients of CGS International Securities can be the first to access the full report from the CGS International Securities website: https://www.cgs-cimb.com
