CSE Global - CGS-CIMB Research 2023-11-10: Infrastructure Leading The Way

• CSE Global (SGX:544)’s revenue of S$185m in 3Q23 (-2% q-o-q, +31% y-o-y) was largely in line with expectations, with 9M23 revenue forming 75% of our FY23F forecast and 78% of Bloomberg consensus’s.

Revenue momentum remains strong

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• contribution from newly acquired subsidiaries (Radio One, Logic Wireless).
• Energy revenue growth was healthy (+19% y-o-y) on more flow orders executed in the US.

Massive quarterly order wins driven by electrification projects

• CSE Global's new order wins in 3Q23 breached a new high of S$302m (+30% q-o-q, +83% y-o-y). infrastructure was the key driver, with new orders surging to S$225m (+103% q-o-q, +309% y-o-y) on the back of
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  2. new orders from recent acquisitions.
• Order book rose to a record high of S$638m at end-3Q23. CSE Global shared that they are on track to achieve a record S$1bn in new order wins for FY23F, as they see a strong pipeline of infra opportunities ahead.
• In addition, we see potential for major contract wins in data centres and wastewater treatment, which CSE Global has been making inroads into. As such, we hike our FY23-25F order wins by 22-24% to S$1.0bn-1.1bn.

FY24F: Driven by strong revenue visibility and margin expansion

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Kenneth TAN CGS-CIMB Research | LIM Siew Khee CGS-CIMB Research | https://www.cgs-cimb.com 2023-11-10 SGinvestors.io

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