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The current construction upcycle in Singapore has seen many construction-related stocks gain handsomely and attract analyst coverage like never in many years.
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HPC Building at 7, Kung Chong Road in the Redhill area serves as HPC's HQ.| The FY2025 Turnaround |
HPC Holdings' revenue surged 66.8% year-on-year to S$283.17 million as several high-value industrial projects moved into their most active construction phases.
After a S$8.48 million loss in FY24, the group reported net profit of S$35.3 million which was bolstered by a S$27.6 million one-off accounting gain from the opportunistic "bargain purchase" of a high-tech fish farm (Apollo Aquarium).
Its core construction business also saw gross margins pivot from negative territory to a healthy 7.27%.
| Three Key Takeaways |
1. Massive Revenue Moat: Strikingly, as of 31 October 2025, HPC’s work backlog reached a record S$1.37 billion.
That is nearly five times their FY25 revenue, providing clear visibility through 2027.
Management has successfully pivoted toward high-spec, higher-margin niches like pharmaceutical buildings and specialized industrial hubs.
2. Trading Below Net Cash: HPC’s market capitalization sits at S$41 million (HK$252 million) based on a recent stock price of 15.8 HK cents.
However, the group holds S$79.13 million in cash.
Subtracting all borrowings (S$13 million) and S$17.29 million in client advances (contract liabilities), the adjusted net cash is an impressive S$49 million (ie, more than its market cap).
So, the market is valuing its entire construction business, the group's headquarters (HPC Building), and the newly acquired Apollo Aquarium assets at less than zero.
3. Strategic Asset Transformation HPC is no longer just a contractor.
By acquiring the eight-storey Apollo Aquarium facility (now Fishbox Pte. Ltd.) at a 90% discount to its construction cost, HPC has entered the industrial asset ownership space.
Once this facility returns to full production capacity, it will generate recurring income, diversifying the group’s revenue away from project-based work.
| Peer Comparison: The Valuation Gap |
While the sector has rallied, HPC remains one of the cheapest construction plays on the market as the table shows:
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Company |
Price-to-Book (P/B) |
Price-to-Earnings (P/E) |
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HPC Holdings |
0.36x |
5.2x* |
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Soilbuild Construction |
6.0x |
14.4x |
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OKP Holdings |
2.1x |
10.0x |
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Huationg Global |
1.2x |
9.4x |
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Hock Lian Seng |
0.8x |
10.9x |
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Ley Choon Group |
2.6x |
12.4x |
* Normalized P/E is estimated at ~5.2x, and excludes a large one-off gain in FY25.
HPC trades at a Price-to-Book (P/B) of 0.36x, a significant discount compared to, say, OKP (2.1x) and Huationg (1.1x).
Despite having the largest order book in this peer group, its market cap remains the lowest relative to its backlog and cash position.
The following table captures 7 new projects secured by HPC in 2025, with a total value of S$734.33 million:
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No. |
Project Description |
Location |
Client/Owner |
Project Type / Scope |
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1 |
New mega depot warehouse |
Tuas South Avenue 10 |
— |
New construction |
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2 |
Additions & alterations to 4-storey cleanroom industrial building, plus new 3-storey central utility building |
— (for Jurong Town Corporation) |
Jurong Town Corporation (JTC) |
Design and build (A&A + new build) |
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3 |
Pharmaceutical buildings, including civil, structural, architectural and site management works |
Tuas |
— |
Design and build (pharmaceutical facilities) |
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4 |
Industrial development with Bio-Safety Level 2 & 3 facilities, including A&A works |
Tuas Avenue 6 |
— |
New build + A&A (biotech/industrial) |
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5 |
Industrial development with workshops, offices & workers’ dormitory |
— (for Hirose Singapore Pte Ltd.) |
Hirose (Singapore) Pte Ltd. |
New development (industrial + dormitory) |
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6 |
5-storey 230KV substation building |
— |
Singapore Power (SP) Group |
New substation construction |
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7 |
Maintenance base with fire stations, workshops, warehouse, admin building & intake substations |
— |
PSA Corporation |
New integrated facility construction |
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Source: HPC FY25 results announcement |
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Aside from a stock that has been illiquid and devoid of dividend payouts, operational risks include higher labor and material costs.
Furthermore, the aquaculture venture is a new business for HPC; a successful restart of the fish farm will be a key test for management in the coming quarters.
The working capital requirements of this venture and the large order book likely explain why no dividend has been declared.
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