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In Singapore's stock market, anomalies occasionally emerge that look like attractive opportunities.
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Koh Eco has a track record of delivering major projects as illustrated below:
| Losses in construction segment |
Several factors contribute to this undervaluation.
| Koh Eco CEO Paul Shin |
 "The impact of COVID-19 on the construction industry has been significant and widespread, with delays in project timelines being a common challenge faced by many companies, including the Company. These delays, typically ranging from two to three years, have resulted in ongoing operational costs, such as staff salaries and the upkeep of site offices, which must be borne by the companies even when work is stalled or progressing slowly."(Source: Minutes of FY2024 AGM) |
Primarily, Koh Eco has grappled with operational headwinds, including persistent losses.
However, much of this can be attributed to legacy COVID-19-era projects impacted by post-pandemic cost escalations, supply chain disruptions, and labor shortages.
For FY2024, the company reported a net loss of SGD 17.1 million (FY23: SGD 13.4 million loss), with revenue dipping 16% to SGD 149 million.
These metrics erode investor confidence in its core engineering and construction segment.
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Koh Brothers Eco FY2024 financials |
SGD |
Details |
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Net Loss Attributable to Equity Holders |
17.1 million |
Reported net loss for Koh Eco. |
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Oiltek Net Profit (FY2024) |
8.89 million |
Oiltek's net profit of RM 29.6 million, converted at RM 3.33 to SGD 1. |
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Koh Eco's Stake in Oiltek |
68.14% |
Koh Eco's ownership in Oiltek. |
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Attributable Profit from Oiltek to Koh Eco |
6.06 million |
Calculated as 68.14% of Oiltek’s SGD 8.89 million net profit. |
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Minority Interest Deduction |
2.83 million |
31.86% non-controlling interest in Oiltek’s net profit. |
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Net Loss Without Oiltek’s Contribution |
23.16 million |
Adjusted net loss for FY2024 (SGD 17.1 million + SGD 6.06 million). |
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Engineering and Construction Segment Losses |
20.2 million |
Primary driver of Koh Eco’s overall losses in FY2024. |
Furthermore, as a small-cap stock, Koh Eco does not entice institutional investors even when the stock's price implies a negative valuation for Koh Eco's non-Oiltek businesses.
However, Koh Eco's fundamentals suggest room for optimism, bolstered by a string of large contract wins as illustrated below:
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Date |
Contract Value (SGD) |
Client |
Project Description |
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June 2025 |
999 million |
Changi Airport Group |
Construction of intra-terminal tunnels at Terminal 5. Secured by subsidiary holding 30% in JV with Penta Ocean |
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December 2024 |
313.9 million |
Land Transport Authority |
Multi-storey bus depot at Lorong Halus |
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November 2024 |
77.6 million |
Sport Singapore |
Piling works for the Toa Payoh Integrated Development |
And one may assume that the contract wins come with decent profit margins, though industry risks remain for cost over-runs, etc as the projects progress.
These wins have swelled Koh Eco's order book to SGD 1.1 billion, signaling robust revenue visibility amid Singapore's construction boom.
Oiltek's performance has been nothing short of breathtaking, and it is what amplifies Koh Eco's undervaluation.
As a leader in edible and non-edible oil refining and renewable energy solutions, Oiltek has seen its shares surge 212% year-to-date (to $1.08), driven by a record RM 332.5 million order book as of July 2025. Ultimately, the valuation gap in Koh Eco's stock could present an opportunity for investors. To fully reflect its 68.14% stake in Oiltek, Koh Eco’s stock price should theoretically be approximately 11.3 cents, compared to its recent price of 8 cents. |
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