Sembcorp Industries

Re: Sembcorp Industries

Postby winston » Tue Jun 09, 2020 10:34 am

not vested

Parting ways with SMM

Upgrade SCI to Add with a higher TP of S$2.49 (S$1.25 post distribution).
This assumes 0.6x FY19 P/BV of SCI stub and SMM’s TERP at S$0.27.

We are positive on the deal as SCI is recapitalising up to S$1.5bn of rights in SMM and demerging its c.61% stake in SMM via dividend in specie.

Having a cleaner structure as energy and urban development could rerate SCI. Structural challenge of getting long-term contracts remain.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 38324C0BCA
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Re: Sembcorp Industries

Postby winston » Tue Jun 09, 2020 2:02 pm

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Sembcorp Industries: Separating from Marine

Sembcorp Industries is a leading energy, water, marine and urban development group operating across five continents worldwide.

The Energy segment provides relative stability while the Marine segment is expected to remain a key drag for the group.

Urban development is the third key pillar which has synergies with the Energy/Utilities segment.

A proposed rights issue for SMM has been announced, as well as a de-merger later.

The marine segment has been a drag on SCI for some time, and the de-merger would allow SCI to focus on providing its suite of energy/utilities and urban solutions.

Indeed, there may be potential for a re-rating of the stock as the market’s concern of a privatisation of SMM is now removed, and the restructuring should narrow the conglomerate discount.

Source: OCBC
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Re: Sembcorp Industries

Postby behappyalways » Sun Jul 19, 2020 6:20 pm

Sembcorp incurs $131 mil net loss in 1H20 on Hin Leong inventory write-off, among other things
https://www.theedgesingapore.com/result ... her-things
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Re: Sembcorp Industries

Postby behappyalways » Thu Jul 30, 2020 3:03 pm

Sembcorp Industries completes divestment of water business in Chile
https://www.theedgesingapore.com/news/c ... ness-chile
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Re: Sembcorp Industries

Postby winston » Thu Aug 06, 2020 12:47 pm

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Sembcorp, Sembmarine urge investors to vote in favour of demerger

by UMA DEVI

SEMBCORP Industries (SCI) and Sembcorp Marine (SMM) are calling on their shareholders to vote in favour of the proposed S$2.1 billion recapitalisation for the offshore and marine engineering group and a demerger from each other that will result in Temasek Holdings having a direct stake in the marine arm.

At the upcoming EGMs on Aug 11, shareholders will vote on three resolutions:
1. SCI's move to distribute its SMM shares in specie
2. SMM's undertaking of the rights issue and
3. A whitewash resolution that will waive investors' rights to receive a mandatory takeover offer from Temasek.

All three resolutions require a simple majority, but are inter-conditional.


Source: Business Times

https://www.businesstimes.com.sg/compan ... f-demerger
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Re: Sembcorp Industries

Postby winston » Fri Aug 07, 2020 7:38 am

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Sembcorp Industries, Sembmarine respond to shareholder queries

Both firms assured that the demerger deal is in the best interests of shareholders.

If any one of the resolutions proposed at the SCI EGM or the SCM EGM is not approved, SCI would retain its current shareholding in SCM, the latter’s $1.5b subordinated loan owing to SCI will remain outstanding, and the critical need to address SCM’s liquidity requirements will not be met.

“If that were to happen, SCM’s strenuous efforts to recapitalise and strengthen its balance sheet will be negated and the critical need to address its liquidity requirements will fail.

Sembmarine added, if ever they failed to gain shareholder approval, that the various capital raising alternatives considered include debt financing, equity-linked debt and equity issuance.

“Faced with the urgency of the situation to recapitalise SCM, the rights issue is the most optimal solution and is in the best interests of shareholders. The rights issue has the support of both SCM’s parent company, SCI, which has undertaken to subscribe for up to $1.5b of rights shares under the rights issue, and its ultimate holding company, Temasek, which has sub-underwritten the balance $0.6bn of rights shares under the rights issue,” Sembmarine stated.

For the transaction to proceed, SCI explained that there are in total three resolutions that need to be approved for the proposed distribution and the proposed SCM rights issue.

For SCI, only one resolution will be tabled: an ordinary resolution to approve the proposed distribution. The resolution requires the approval of a simple majority (>50%) of SCI shareholders who are voting at the SCI EGM, whilst Temasek will abstain from voting on this resolution.

For SCM, two resolutions will be tabled: an ordinary resolution to approve the proposed SCM rights issue and a whitewash resolution with respect to the proposed distribution. Both resolutions require the approval of a simple majority (>50%) of SCM Shareholders who are voting at the SCM EGM, where Temasek will also abstain from voting in on the whitewash resolution.

SCI also noted that the three resolutions are inter-conditional.

Following the demerger, SCI pledged to focus on unlocking value for shareholders, executing their transformation plan to create long-term value for our stakeholders.

“The rights issue will provide SCM with the much needed recapitalisation to ride out the industry downturn, to strengthen its balance sheet and reposition the company for its long term viability. It is beneficial to the company and all shareholders,” Sembmarine added.

Source: Business Times

https://sbr.com.sg/stocks/news/sembcorp ... er-queries
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Re: Sembcorp Industries

Postby winston » Fri Sep 18, 2020 9:20 am

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Sembcorp Industries (SCI SP)
Charting Its Own Path


Since the demerger of SMM from SCI on 9 Sep 20, the latter’s share price has significantly outperformed, rising by 36% from its theoretical demerged price of S$0.96/share.

We nevertheless continue to see upside over the next 6-12 months given that the company trades at a discount to its regional utilities peers both on a P/B and PE basis.

Maintain BUY with an updated target price of S$1.66 as we have extracted the book value of SMM from our valuation.

Source: UOBKH

https://research.uobkayhian.com/content ... 9c440fc254
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Re: Sembcorp Industries

Postby winston » Fri Sep 18, 2020 9:32 am

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Sembcorp Industries (ADD, tp:SGD1.95)

- Need to sharpen focus

- We factor in lower equity base and fair value loss of c.S$1.1bn in SCI post SMM’s econsolidation.

Our NAV stands at S$1.77 and S$1.95 for FY20-21F.

We think clearer communication to be a ‘more focused’ group could restore investor confidence while restructuring is a medium-term catalyst.

Our TP is also adjusted to S$1.95, now based on 1x CY21F group P/BV, in line with the expected improved ROE of c.11.8%.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... F133910150
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Re: Sembcorp Industries

Postby winston » Thu Sep 24, 2020 7:53 am

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Sembcorp Industries a 'buy' as it starts to charter its own course

by Samantha Chiew

On September 9, Sembcorp Marine (SMM) demerged from Sembcorp Industries (SCI) and the latter’s share prices has since significantly outperformed, rising by 36% from its demerged price of 96 cents per share.

UOBKH is positive on the stock and has maintained its “buy” recommendation on SCI with an upgraded target price of $1.66 from just $1.25 previously, to reflect a higher price-to-book ratio of 0.8 times (from 0.6 times).

Loh views this target price increase as reasonable, as he says, “the higher target multiple reflects a better comparability between SCI and its regional utilities peers without the offshore marine overhang”.

Furthermore, SCI on September 11 announced that it expanding its presence in China, as it inked a memorandum of understanding (MOU) with NASDAQ-listed GDS Holdings to develop and provide renewable energy solutions for GDS’s data centres in China, as well as looking for opportunities to realise operational synergies between GDS’s data centres and Sembcorp’s renewable-power generation and water management systems.

Although no potential financial impact as provided from this MOU, Loh notes that GDS reported a strong set of 2Q20 results with revenue growing 36% y-o-y to US$189 million, while EBITDA rose 48% y-o-y to US$90 million.

Importantly, its EBITDA margin expanded nearly 4 percentage points to 47.2%. Operationally it saw a 51% y-o-y increase in its total committed and pre-committed area to about 333,000m³ while its area-in-service increased by 48% y-o-y to over 266,000m³. GDS’s clients include Alibaba, Amazon Web Services, Huawei, JD.com and Bytedance.

As at 4.35pm, shares in SCI are trading at $1.34, or 0.6 times FY20 book with a dividend yield of 1.9%.

Source: The Edge

https://www.theedgesingapore.com/capita ... own-course
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