Report Summary

• OCBC Group Research initiates coverage on Nordic Group with a BUY rating and a fair value estimate of SGD0.59, representing a 37% upside from the last close. The forecasted FY26 dividend yield is an attractive 4.9%.
• Recent contract wins (SGD70m in Dec 2025) and strategic acquisitions in defence and sustainability sectors provide improved revenue visibility and long-term stability.
• Nordic’s diversified revenue base, strong balance sheet, and pivot towards maintenance services help buffer cyclical risks and support steady growth.
• Global and local trends—such as increased government spending on defence and sustainability, technology sector expansion, and resilient Asian economies—are expected to support Nordic’s future growth.
• Key risks include global economic downturns, headwinds in the chemicals industry, and potential challenges from inorganic growth (acquisitions).
• Valuation is supported by historical P/E averages, with catalysts including further contract wins and improved sentiment for Singapore small and mid-cap stocks.
• Nordic’s history of accretive acquisitions and focus on synergies among subsidiaries has driven revenue CAGR of 9.3% since listing.