UOB Kay Hian: Alpha Picks: Double Happiness Again In Aug 25; Add BRC and YZJSGD; Remove CD, CICT, PROP

Alpha Picks – Singapore

Double Happiness Again In Aug 25; Add BRC and YZJSGD; Remove CD, CICT, PROP

Date: Wednesday, 03 September 2025
Prepared by: UOB Kay Hian Private Limited

ALPHA PICKS

Executive Summary

UOB Kay Hian’s Alpha Picks portfolio delivered exceptional performance in August 2025:

Equal-weighted: +11.4% mom (vs STI +2.3%)
Market cap-weighted: +3.2% mom (beating STI by 0.9ppt)
Outperformance: +9.1 percentage points vs benchmark

For September 2025, the firm is adding BRC Asia (BRC) for construction exposure and Yangzijiang Shipbuilding SGD (YZJSGD) for new order flow and attractive valuations, while taking profits on CapitaLand Integrated Commercial Trust (CICT), ComfortDelGro (CD), and PropNex (PROP).

Portfolio Changes for September 2025

New Additions

BRC Asia (BRC): Expected to benefit from firm construction demand amid increased infrastructure spending
Yangzijiang Shipbuilding SGD (YZJSGD): Recent new order wins and attractive valuations

Profit-Taking

CapitaLand Integrated Commercial Trust (CICT): Following recent price strength
ComfortDelGro (CD): Locking in gains
PropNex (PROP): Taking profits after +77.5% gain in August

Top Performers in August 2025

Company	Aug 2025 Return	Key Driver
PropNex	+77.5%	Strong earnings and property market optimism
Hong Leong Asia	+56.7%	Construction sector strength
Marco Polo Marine	+22.4%	Offshore sector strength
CSE Global	+7.9%	Robust fundamentals
DFI Retail	+5.7%	Signs of sustained turnaround
China Sunsine	+5.0%	Strong fundamentals

Note: Frencken (-13.9% mom) and UMS (-9.2% mom) saw pullbacks due to tariff-related uncertainties, but both remain positive year-to-date.

Key Stock Recommendations

Company	Rec	Price (S$)	Target (S$)	Upside (%)	Key Catalyst
DFI Retail	BUY	3.20	4.30	34.4	Earnings uplift from higher-margin businesses
Hong Leong Asia	BUY	2.47	2.63	6.5	Stronger-than-expected earnings
Yangzijiang Shipbldg	BUY	3.07	3.45	12.4	New order wins & contract execution
BRC Asia	BUY	4.02	3.29	-18.2	Strong order wins from domestic construction demand
OCBC	BUY	16.85	20.15	19.6	Attractive yield; lower NIM risk exposure

Market Context

Singapore equities continued their ascent in August 2025, with the STI gaining 2.3% month-on-month, led by strong sector performances:

Telecoms: +10.1% mom
Technology: +5.1% mom
Plantation: +4.2% mom

Local sentiment remained buoyant, supported by the MAS’ S$5 billion Equity Market Development Programme (EQDP), which continued to draw investor interest to under-owned small- and mid-cap names.

Track Record

The Alpha Picks strategy has demonstrated consistent outperformance, beating the FSSTI in 12 out of the past 15 months.

The portfolio’s success stems from its focus on structural growth themes and tactical exposure to beneficiaries of Singapore’s market development initiatives. With 11 out of 14 stocks outside the STI, the strategy continues to benefit from rotational fund flows toward EQDP-eligible names.

Current Portfolio (September 2025)

The revised portfolio includes:

BRC, CLAR, CSSC, CSE, DFI, FEH, FRKN, HLA, MPM, OCBC, UMS, VALUE, and YZJSGD

The portfolio remains tilted toward high-conviction small- and mid-cap names with visible earnings drivers.

Analyst:
Singapore Research Team
+65 6535 6868
research@uobkayhian.com

Disclaimer: This report is prepared by UOB Kay Hian Private Limited for information only and is not an offer or solicitation to deal in securities. This report is provided for general circulation and does not have regard to the specific investment objectives, financial situation and particular needs of any recipient. Advice should be sought from a financial adviser regarding the suitability of any investment product, taking into account specific investment objectives, financial situation or particular needs before making a commitment to purchase any investment product. Investment recommendations are subject to risks and investors should conduct their own research before making investment decisions.

Full Report: Download the complete research report here

Offshore Marine – Singapore

Full Steam Ahead If You’re In Singapore

Date: Tuesday, 29 July 2025
Prepared by: UOB Kay Hian Private Limited

OVERWEIGHT (Maintained)

Executive Summary

Global shipping and offshore markets have slowed in 2025 amid geopolitical uncertainty, with newbuild orders down 54% year-on-year and some rig dayrates showing softness. While US energy companies revealed cautious guidance at their 2Q25 earnings announcements, we remain optimistic on STM and MPM while YZJSGD’s recent rally affirms improving sentiment, with valuations remaining attractive.

Sector Picks & Recommendations

Company	Ticker	Recommendation	Current Price (S$)	Target Price (S$)	Upside (%)
Keppel Ltd	KEP SP	BUY	8.20	9.25	12.8
Sembcorp Industries	SCI SP	BUY	7.68	8.00	4.2
Seatrium	STM SP	BUY	2.42	2.96	22.3
Yangzijiang Shipbuilding	YZJSGD SP	BUY	2.56	3.29	28.5
Marco Polo Marine	MPM SP	BUY	0.059	0.066	11.9

Key Market Developments

Shifting Sentiments: Global geopolitical tensions and US trade policies have created complex forces on the shipping and offshore marine sector in 2025
Moderated Pace: Newbuild contracting down >50% year-on-year as at end-1H25, with slowdown particularly pronounced in car carrier, LNG carrier, and tanker segments
Alternative Fuel Focus: Despite overall slowdown, 55% of orders are for alternative fuel-capable vessels, highlighting the continued push towards greener vessels
Mixed Offshore Rig Market: Leading-edge rig dayrates showed stability in 2Q25, but broader market has seen softening for high-specification jack-ups in Southeast Asia

1H25 Earnings Forecast

Expect stronger profitability year-on-year across key holdings:

Company	1H24 Revenue	1H25F Revenue	1H24 Profit	1H25F Profit	UOBKH vs Consensus
Keppel (KEP)	S$3,224m	S$3,488m	S$304m	S$497m	+2.9%
Sembcorp Industries (SCI)	S$3,208m	S$3,306m	S$540m	S$578m	In-line
Seatrium (STM)	S$4,015m	S$4,408m	S$115m	S$145m	-23.5%
Yangzijiang (YZJ)	RMB13,049m	RMB18,520m	RMB3,058m	RMB3,833m	+4.9%

Stock Highlights

Seatrium (STM SP): Strong operational momentum with delivery of ExxonMobil’s FPSO and robust execution of S$21.3b orderbook. Recent Floating Storage Regasification Unit win enhances multi-year revenue visibility.
Yangzijiang (YZJSGD SP): Stock rallied 26% since May report. Remains inexpensive at 2025F PE of 6.8x and P/B of 1.3x while generating ROE of 25.0%. Earnings visibility extends into 2028.
Marco Polo Marine (MPM SP): Vessels exposed to potential upside in charter rates from 4Q25 and beyond.

Risk Factors

Delays in project sanctioning due to supply chain issues
Lack of financing for fossil fuel-related industries
Global recession leading to lower capex
Continued negative impact on sector sentiment due to trade and tariff proposals

Analyst:
Adrian Loh
+65 6590 6633
adrianloh@uobkayhian.com

Disclaimer: This report is prepared by UOB Kay Hian Private Limited for information only and is not an offer or solicitation to deal in securities. This report is provided for general circulation and does not have regard to the specific investment objectives, financial situation and particular needs of any recipient. Advice should be sought from a financial adviser regarding the suitability of any investment product, taking into account specific investment objectives, financial situation or particular needs before making a commitment to purchase any investment product. This report is confidential and may not be published, circulated, reproduced or distributed without prior written consent of UOBKH.

Full Report: Download the complete research report here

Date: 24 February 2025

Prepared by: UOB Kay Hian

Overview

On 21 Feb 2025, the Monetary Authority of Singapore (MAS) announced a S$5b investment initiative aimed at boosting liquidity for Singapore’s capital market. This initiative is expected to benefit small and mid-cap stocks, particularly those listed on the Singapore Exchange (SGX).

Top Small/Mid Cap Picks

Company	Recommendation	Share Price (S$)	Target Price (S$)	Upside (%)
ComfortDelGro	BUY	1.36	1.77	30.1
CSE Global	BUY	0.45	0.59	31.1
China Sunsine	BUY	0.48	0.58	20.8
Centurion	BUY	1.02	1.11	8.8
Digital Core REIT	BUY	0.57	0.88	54.4
Marco Polo Marine	BUY	0.05	0.072	41.2
Propnex	BUY	1.13	1.18	4.4
Riverstone	BUY	1.00	1.16	16.0
Singapore Post	BUY	0.56	0.72	29.7
Valuetronics	BUY	0.65	0.78	20.0

Analysis

The MAS investment initiative is designed to enhance market liquidity and is expected to significantly benefit small and mid-cap stocks. The focus on actively managed strategies rather than index-focused investments will help diversify investments and bring attention to undervalued stocks with strong growth potential.

Valuation Overview

Key metrics such as P/E ratios, P/B ratios, and dividend yields were considered in selecting the top stock picks. This approach ensures that the selected stocks not only have strong growth potential but also offer attractive valuations and returns to investors.