ST Engineering - RHB Invest 2024-05-06: New Contract Win In Singapore; BUY

• ST Engineering has won a S$175m contract from Singapore’s Land Transport Authority (LTA) to modernise Singapore’s public buses. This new contract adds to its already-high orderbook of S$27.4bn.
• - Read this at SGinvestors.io -
• We remain upbeat on ST Engineering, which offers defensive dividends of S$0.04 per quarter and strong profit growth.

ST Engineering to modernise Singapore public bus fleet.

• ST Engineering (SGX:S63)’s Urban Solutions and Satcom (USS) arm, along with Trapeze Group as its consortium partner, has been the technology provider for Singapore’s bus fleet management system since 2014. The USS segment has won a contract valued at over S$175m from Singapore’s LTA to modernise Singapore’s public bus fleet and operations.
  • - Read this at SGinvestors.io -
  • The upgrades will take advantage of the 5G network, which will allow for faster fare transactions for commuters and faster data exchanges between the buses and the back-end systems.
  • The contract will cover ~ 5,800 public buses, and the modernisation exercise will be implemented progressively from 2Q24 and completed by 2027.
• This contract adds to ST Engineering's order backlog of S$27.4bn, which implies a book-to-bill ratio of 2.7 years.

Not overly concerned with higher-for-longer interest rates.

• Read more at SGinvestors.io.

Shekhar Jaiswal RHB Securities Research | https://www.rhbgroup.com/ 2024-05-06 SGinvestors.io

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