Keppel Ltd

BN4: XSES (SGP)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	SGD 5.80	Vcph	Shthpvcz

Keppel: Strategic Restructure Should Help Unlock Value and Allow Cost Savings

Chokwai Lee

May 4, 2023

We keep Keppel’s fair value estimate at SGD 7 following updates on its Vision 2030 plans. The immediate takeaway is that Keppel targets annual cost savings of SGD 60 million to SGD 70 million by 2026 from its restructure into an alternative real asset manager. We retain our earnings forecast for now but note that there is potential upside once the cost cuts are factored in pending the release of more details in Keppel’s first-half presentation. We also believe that the new structure should allow for greater earnings visibility, and this could unlock value for the group. We see Keppel as a buy presently, and this news should support its share price.

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