ST Engineering - RHB Invest 2024-06-24: Order Wins Continue; Keep BUY

• In June, ST Engineering secured new defence contracts in Europe valued at S$100m. Management guided that Pensacola International Airport’s third aircraft maintenance hangar is taking shape, while TransCore has been chosen by the Missouri Department of Transportation (MoDOT) to implement its TransSuite Advanced Traffic Management System (ATMS).
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New defence contract wins.

• ST Engineering (SGX:S63) has secured contracts for NATO standard 155mm ammunition with new customers in Europe. In addition to the 155mm ammunition, the group also received orders for the 40mm ammunition from European customers. These wins were a result of competitive tenders and mark a pivotal expansion of ST Engineering’s footprint in the ammunition segment.
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Other news updates.

• In early June, ST Engineering also broke ground for its third aircraft maintenance hangar at the Pensacola International Airport in Florida, US. This expansion of capacity was already announced earlier, and the new 167,000 sq ft hangar will contribute an additional 500,000 manhours annually from 2H26.
• TransCore also announced its selection by the MoDOT to deploy its ATMS in the St. Louis and Springfield traffic management centres (TMCs). These major metropolitan areas add to the current TransSuite ATMS deployment at the KC Scout TMC in the Kansas City region.

Strong outstanding orderbook.

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Shekhar Jaiswal RHB Securities Research | https://www.rhbgroup.com/ 2024-06-24 SGinvestors.io

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