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NAM CHEONG
Re-rating catalysts in sight. Nam Cheong, as a leading offshore support vessel provider with significant exposure to Sarawak’s oil and gas activities, stands to benefit from increased demand for OSVs, especially the two idling workboats (adding 7-8% to group profit). In addition, its Miri shipyard is also poised to win newbuild OSVs orders, with positive progress on new contract negotiations in recent months. One newbuild order could incrementally increase earnings and fair value by 2-3%, with Miri shipyard capacity to handle 6-8 units, including 3-4 company-owned vessels, before outsourcing. The workboat deployment and newbuild orders are yet factored in our earnings and fair value, which could see incremental 10-20% to FY26 bottomline.
Reiterate BUY and TP SGD1.25 (8x FY26 PE). Trading at ~5x FY26 PE, Nam Cheong remains unwarrantedly undervalued relative to peers ASL Marine (9x), PACRA (10x) and Marco Polo (14x), despite steady income stream from 60-70% long-term charters. We believe potential newbuild orders and the redeployment of idling vessels in 1Q26, especially with Sarawak gas resolution, to drive share price re-rating after a relatively muted earnings growth in 2025.
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Alpha Picks: Rebalanced For Year-End Opportunities
Repositioning our picks. We take profit on FRKN, UMSH and SIA, with the latter removed as we believe its weakest quarterly performance is behind us.
In their place, we add Keppel for its strong growth trajectory, new initiation UltraGreen for its high-margin profile and market leadership, and SATS for its attractive valuation and upbeat growth outlook.
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UltraGreen.ai (UGAI SP)
Global ICG Market Leader With Superior Margins And Growth Profile
Highlights
• UltraGreen is a global FGS powerhouse with a dominant ICG market leadership, extensive distribution network and superior margin profile.
• We expect strong three-year revenue/EPS CAGRs of 21%/22% respectively in 2024-27, driven by rising procedure volumes, expanding geographies and strong pricing power.
• Initiate coverage with BUY and a target price of US$2.00.
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Frasers Property Limited
Resilience in diversity
■ FPL continues to execute on its “creating, sustaining and unlocking value” strategy to deliver resiliency to shareholders.
■ Its I&L segment in Thailand continues to see robust demand.
■ Maintain Add rating, with an unchanged TP of S$1.41.
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Oriental Kopi Holdings (KOPI MK)
Highly Exciting But Mostly Priced In For Now
Highlights
• SSSG accelerates despite aggressive rollout for the year. Meanwhile, upcoming locations will benefit from an influx of tourist arrivals.
• International expansion is on the horizon, with firmed up details by 1Q26.
• Valuations have surged, pricing in most of its exciting prospects. Maintain HOLD and target price of RM1.20.
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CENTURION CORP
At S$1.34, Centurion is capitalized at S$1.1bln and trades at 10.0x
forward P/E and 0.9x P/B with a dividend yield of 3.0%. Centurion has
started to deploy its cash proceeds from the REIT spin-off into new
assets, and this Perth PBSA will be the fourth Epiisod property in the
pipeline.
While outlook remains firm, Centurion’s results may see a dip
in FY26 given lower contributions from the assets in the REIT spin-off,
and as it takes time for the cash proceeds to be used in new development
projects. A distribution-in-specie of some of the REIT shares to Centurion
Corp shareholders may be a booster in 2026. Consensus TP of S$1.78
represents a 33% potential upside. We maintain “Accumulate” on Centurion.
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