ST Engineering - Maybank Research 2026-03-02: Growing Order Book, But Elevated Valuation

• ST Engineering (SGX:S63)'s order book grew 16% y-o-y with half of new contract wins coming from defence. We raise estimates and lower our cost of capital assumption and raise ST Engineering's target price to S$9.5. Maintain HOLD on fair valuation (30.5x 12M fwd PE).

Navigating peaks

• - Read this at SGinvestors.io -
• Core PATMI was S$851m, +21% y-o-y, in line with our estimate. High single digit revenue growth coupled with better cost management underpinned growth despite fall in gross margins.

Disciplined execution

• - Read this at SGinvestors.io -
• Core EBIT grew 16% y-o-y led by improved margin mix and efficiency gains despite 180bps y-o-y decline in gross margin. Aerospace and defence businesses anchored EBIT growth as well, while EBIT for urban solutions business fell due to higher SATCOM losses.
• Gross debt was lower at S$4.8b (vs. S$5.8b a year ago) due to repayments from divestments. Including the interest cost savings, core PATMI rose 21% to S$851m.

Steady order wins anchored by defence

• Read more at SGinvestors.io.

Above is an excerpt from a report by Maybank Research.
Clients of Maybank Securities may be the first to access the full PDF report @ https://www.maybanktrade.com.sg/.

Previous report by Maybank:
2025-11-14 ST Engineering - Steady Growth; Steep Valuation.

Price targets by 5 other brokers at ST Engineering Target Prices.

Listing of research reports at ST Engineering Analyst Reports.

Relevant links:
ST Engineering Share Price History,
ST Engineering Announcements,
ST Engineering Dividend Payout Dates & Corporate Actions,
ST Engineering News