• BUY Entry – 2.15 Target – 2.50 Stop Loss – 2.00
  • SCI is a leading provider of sustainable solutions in Asia. The group has a target for its sustainable solutions portfolio to make up 70% of the group’s net profit by 2025, up from 40% in 2020. What this means is that the group targets to achieve a 30% CAGR for its renewable energy portfolio by 2025, and for gross installed renewable energy capacity to increase from 2.6GW at the end of 2020, to 10GW by 2025.
  • The only green play in town. SCI is the only pure-play green energy stock listed in Singapore. The group generates 56% of 2020 profits from Gas & Thermal power, 29% from Waters & Others, and 15% from Renewable power. In terms of geographical focus, 29% of net profit is contributed from China, 27% from Singapore and the rest of Southeast Asia, and 27% from India. 
  • Market leader. SCI is a leading renewables player in Singapore with about 280MWp of solar capacity. The group offers the full suite of solutions including ground-mounted, rooftop and floating solar PV systems. In India, SCI achieved the highest wind capacity under self-operations of any independent power producer in the country. 
  • Positive consensus estimates. Analysts are generally bullish on the stock with 9 BUYS and 2 HOLD recommendations. There is a 12m TP of S$2.62 which implies a 19% total return from the last close price. Valuations are decent at around 1.0x FY2022F P/B against a forecasted 10.5% FY2022F ROE. 

SCI’s path to a sustainable future by 2025

SCI SP (Source: Bloomberg)