Thursday, July 31st, 2025

From TA and FA perspective, this company has 39% upside.

The company 1H24 Financial Performance:

Revenue and Profit Growth: The company reported robust financial results for 1H24, with revenue growing by 6.8% year-on-year (YoY) to S$384.7 million. The company’s core Profit After Tax and Minority Interest (PATMI) surged by 31.3% YoY to S$18.6 million, driven by higher construction demand and improved margins from its concrete and cement business.

EBITDA: The company’s EBITDA increased by 17.9% YoY to S$37.1 million, reflecting better operational efficiency and a favorable project mix.
Gross and Net Margins: Gross margin improved slightly to 22.0%, while the core PATMI margin rose to 4.8%, showcasing the company’s ability to maintain profitability amid rising operational costs.

Dividend and Shareholder Returns
Higher Dividend: this company declared an interim dividend of 0.7 Singapore cents per share for 1H24, up from 0.5 Singapore cents per share in 1H23. The total dividend for 2024 is expected to reach 2.8 Singapore cents per share, offering an attractive annualized dividend yield of around 5.5%.

Valuation and Recommendation
Buy Rating Maintained: The report maintains a “Buy” rating with a target price of S$0.71, implying a potential upside of 39.2% from its current share price of S$0.51. The valuation is based on a 2024 forward price-to-earnings (PE) ratio of 11x, reflecting the company’s strong earnings outlook and attractive dividend yield.

Risks
Operating Costs: The company faces risks related to rising operating costs, particularly due to tight labor conditions and energy price volatility, which could impact profit margins.

Conclusion
This company is poised for continued growth, supported by Singapore’s booming construction sector and its leading position in sustainable concrete solutions. The company’s strong financial performance, coupled with its strategic focus on green products and international expansion, makes it an attractive investment with significant potential for shareholder returns.

Thank you

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