Sembcorp Industries (U96) AI Stock Analysis

• Market Cap: S$11.30B
• Dividend Yield: 1.42%
• Average Volume (3M): 4.50M
• Price to Earnings (P/E): 11.1
• Beta (1Y): 0.63
• Revenue Growth: -6.69%
• EPS Growth: 6.76%
• Country: SG
• Employees: 5,347
• Sector: Industrials
• Sector Strength: 72
• Industry: Conglomerates
• EPS (TTM): 0.11
• Shares Outstanding: 1,780,465,300
• 10 Day Avg. Volume: 4,918,760
• 30 Day Avg. Volume: 4,504,430
• PEG Ratio: 1.29
• Price to Book (P/B): 1.83
• Price to Sales (P/S): 1.53
• P/FCF Ratio: -50.19
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 0.58
• Revenue Forecast (FY): S$6.31B

• Rating: 71 Outperform
• Price Target: S$7.50 ▲(17.92% Upside)

Sembcorp Industries' strong profitability and effective equity utilization are key strengths, though high leverage and cash flow management issues present risks. Positive technical indicators and reasonable valuation further support the stock's attractiveness.

Positive Factors

Renewable Energy Expansion

This project enhances Sembcorp's renewable energy portfolio and aligns with global sustainability trends, strengthening its market position in clean energy.

Profitability

Strong profitability and margin improvements indicate efficient operations and potential for sustained earnings growth, supporting long-term financial health.

Equity Utilization

Effective equity utilization suggests that the company is generating substantial returns on its investments, which is a positive indicator of management efficiency.

Negative Factors

Revenue Growth Challenges

Negative revenue growth indicates potential difficulties in expanding sales, which could impact long-term growth prospects if not addressed.

High Leverage

High leverage can increase financial risk and limit flexibility, potentially affecting the company's ability to invest in growth opportunities.

Cash Flow Management

Negative free cash flow highlights liquidity issues and the need for better cash management to ensure financial stability and support operations.

Sembcorp Industries Business Overview & Revenue Model

Company Description

Sembcorp Industries (U96) is a Singapore-based integrated energy and urban solutions provider, operating across various sectors including energy, water, and urban development. The company is primarily engaged in the generation of electricity through thermal and renewable sources, water and wastewater treatment, and the development of sustainable urban infrastructure projects. Sembcorp is committed to supporting sustainable development and providing innovative solutions to meet the evolving needs of communities and industries.

How the Company Makes Money

Sembcorp Industries generates revenue through multiple key streams. The primary source of income comes from its energy segment, which involves the generation and sale of electricity, including both conventional and renewable energy sources such as solar and wind. Additionally, the company's water segment contributes to its revenue through the treatment and supply of water to municipalities and industries, as well as the provision of wastewater treatment services. Urban development projects, including industrial parks and integrated townships, also add to Sembcorp's earnings through land sales and leasing. The company engages in strategic partnerships and joint ventures, particularly in overseas markets, to enhance its operational capabilities and expand its customer base. Factors such as the global transition towards sustainable energy, government policies supporting renewable energy, and increasing demand for water resources in urban areas play significant roles in driving Sembcorp's growth and profitability.

Sembcorp Industries Financial Statement Overview

Summary

Sembcorp Industries demonstrates strong profitability and effective equity utilization. However, challenges in revenue growth and high leverage pose risks. Cash flow management needs improvement to ensure liquidity and financial flexibility.

Income Statement

Sembcorp Industries shows strong profitability with a consistent EBIT and EBITDA margin improvement over the years, reaching 25.23% and 32.24% respectively in 2024. However, the revenue growth rate has been negative in recent years, indicating potential challenges in expanding sales.

Balance Sheet

The company maintains a high debt-to-equity ratio of 1.75, which is a concern for financial stability. However, the return on equity remains healthy at 18.86%, suggesting effective use of equity to generate profits. The equity ratio is moderate, reflecting a balanced asset structure.

Cash Flow

Operating cash flow remains positive, but the free cash flow has turned negative in 2024, indicating potential liquidity issues. The free cash flow to net income ratio is negative, highlighting a need for better cash management despite a reasonable operating cash flow to net income ratio.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.15B	6.42B	7.04B	7.83B	6.41B	5.45B
Gross Profit	1.48B	1.50B	1.57B	1.23B	819.00M	856.00M
EBITDA	2.06B	2.07B	1.83B	1.29B	677.00M	897.00M
Net Income	1.01B	1.01B	942.00M	848.00M	279.00M	-1.01B
Balance Sheet
Total Assets	17.51B	18.18B	15.50B	16.02B	14.39B	13.56B
Cash, Cash Equivalents and Short-Term Investments	993.00M	985.00M	830.00M	1.29B	1.43B	1.19B
Total Debt	8.97B	9.40B	7.56B	7.36B	7.65B	7.95B
Total Liabilities	11.99B	12.52B	10.63B	11.80B	10.48B	10.09B
Stockholders Equity	5.21B	5.36B	4.59B	3.98B	3.77B	3.34B
Cash Flow
Free Cash Flow	95.00M	-196.00M	645.00M	1.04B	929.00M	158.00M
Operating Cash Flow	1.57B	1.41B	1.48B	1.65B	1.22B	491.00M
Investing Cash Flow	-922.00M	-1.44B	-878.00M	-1.39B	-100.00M	-1.28B
Financing Cash Flow	-653.00M	154.00M	-1.10B	-203.00M	-855.00M	55.00M

Sembcorp Industries Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.36
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:U96, the sentiment is Positive. The current price of 6.36 is below the 20-day moving average (MA) of 6.42, above the 50-day MA of 6.26, and above the 200-day MA of 6.34, indicating a bullish trend. The MACD of 0.03 indicates Positive momentum. The RSI at 55.45 is Neutral, neither overbought nor oversold. The STOCH value of 43.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SG:U96.

Sembcorp Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BS6	79 Outperform	$13.55B	9.51	30.76%	3.55%	0.42%	40.48%
BEC	74 Outperform	S$1.14B	11.73	21.22%	4.87%	-13.76%	10.28%
U96	71 Outperform	S$11.30B	11.13	19.65%	1.42%	-6.69%	6.76%
BN4	71 Outperform	S$17.68B	18.00	8.75%	3.36%	-0.62%	34.52%
5E2	65 Neutral	$7.40B	27.75	4.07%	0.69%	25.68%	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
S58	62 Neutral	S$5.16B	21.21	9.89%	1.43%	12.54%	332.80%

Sembcorp Industries Corporate Events

Sembcorp Secures Approval for Singapore’s First 24/7 Renewable Energy Import

Sembcorp Utilities, a subsidiary of Sembcorp Industries, along with Sarawak Energy Berhad, has received conditional approval from Singapore’s Energy Market Authority to import 1GW of renewable energy from Sarawak to Singapore. This initiative, expected to begin operations by 2035, marks Singapore’s first large-scale 24/7 power import project, utilizing predominantly hydropower sources certified for sustainability. The project aims to enhance regional energy cooperation and resilience, contributing to the ASEAN Power Grid.