Transport Sector, China and Asia-focused Research

Charles De Trenck

Thematic (Sector/Industry)

Another report of potential suitors made it to market on Friday, forcing NOL to disclose there have been talks with French carrier CMA and global leader Maersk. NOL&rsquo;s shares rose some 6% to $1.05 and closer to book NAV per share around&nbsp;S$1.4 (and higher when the US dollar drifts higher). But what would make a potential transaction more interesting, if at all, keeping in mind the Hapag IPO pricing was about 25% below the original high end of the range?

Another report of potential suitors made it to market on Friday, forcing NOL to disclose there have been talks with French carrier CMA and global leader Maersk. NOL&rsquo;s shares rose some 6% to $1.05 and closer to book NAV per share around&nbsp;S$1.4 (and higher when the US dollar drifts higher). But what would make a potential transaction more interesting, if at all, keeping in mind the Hapag IPO pricing was about 25% below the original high end of the range?

NOL's Latest Potential Merger Discussions... Where is the [Partial] Exit for Temasek?

Head of Digital Services at Singapore Post Ltd, Singapore Post Limited

Bernard Leong

Head of Digital Services at Singapore Post Ltd

Singapore Post Limited

How should digital leaders advise businesses? Two ways: target the high and low ends of the market while allowing cannibalisation against their current business model in a controlled pace.&nbsp;The trick lies in capital allocation and separation of the products/services moving towards both ends. Digital products often require high cost of acquisition contrary to perception by businesses that it is cheaper against traditional channels.

How should digital leaders advise businesses? Two ways: target the high and low ends of the market while allowing cannibalisation against their current business model in a controlled pace.&nbsp;The trick lies in capital allocation and separation of the products/services moving towards both ends. Digital products often require high cost of acquisition contrary to perception by businesses that it is cheaper against traditional channels.

Digital disruption bifurcates traditional market segmentation

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/spindex-industries-ltd" target="_blank" data-smartkarma-citation="entities:17868:1" rel="noopener">Spindex Industries (SPE SP)</a> disclosed a privatisation through a scheme of arrangement from the Chairman and PrimeMovers Equity at S$1.43 per share. Including the FY2025 dividend, the total offer is S$1.45.</li>
<li>While the offer is attractive compared to historical trading ranges, it is light in comparison to peer and precedent transaction multiples. It is also below book value. </li>
<li>The offer has not been declared final. However, the lack of a disinterested shareholder holding a blocking stake and moderate retail ownership lowers the vote risk.  </li>
</ul>



Spindex Industries (SPE SP) disclosed a privatisation through a scheme of arrangement from the Chairman and PrimeMovers Equity at S$1.43 per share. Including the FY2025 dividend, the total offer is S$1.45.
While the offer is attractive compared to historical trading ranges, it is light in comparison to peer and precedent transaction multiples. It is also below book value. 
The offer has not been declared final. However, the lack of a disinterested shareholder holding a blocking stake and moderate retail ownership lowers the vote risk.  


Spindex Industries (SPE SP): PrimeMovers Equity-Sponsored MBO at S$1.43

SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Equity Bottom-Up

<ul><li>10 in 10 with Fu Yu Corporation - Precision Engineering for a Sustainable Future 10 Questions for https://investors.sgx.com/_security-types/stocks/F13 Fu Yu Corp has a significant presence in precision plastic injection moulding.</li><li>10 in 10 with Fu Yu Corporation - Precision Engineering for a Sustainable Future A key cornerstone in Fu Yu’s transformation is your Smart Factory, which will improve manufacturing capabilities and operational efficiency.</li></ul>

10 in 10 with Fu Yu Corporation - Precision Engineering for a Sustainable Future 10 Questions for https://investors.sgx.com/_security-types/stocks/F13 Fu Yu Corp has a significant presence in precision plastic injection moulding.10 in 10 with Fu Yu Corporation - Precision Engineering for a Sustainable Future A key cornerstone in Fu Yu’s transformation is your Smart Factory, which will improve manufacturing capabilities and operational efficiency.

10 in 10 with Fu Yu Corporation - Precision Engineering for a Sustainable Future

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 <div class='content-caption'>Fu Yu - MD</div>
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For banking and finance veteran David Seow, the African proverb “If you want to run fast, run alone. If you want to run far, run together” carries a particular resonance - it encapsulates his core management values of teamwork, communication, innovation and action. 
“Each person’s contribution matters, but only if we work together,” said the Group Managing Director of SGX-listed precision plastic components manufacturer Fu Yu Corporation Ltd. 
“Teamwork is key for an organisation to flourish. We need people who are able to complement each other’s diverse skillsets, and people who do their part properly to derive the right outcomes for everyone in the organisation.” 
In turn, good communication forms the bedrock of strong teamwork. “We should be unafraid to give constructive feedback, to seek advice to learn and improve, and work together to achieve common goals,” he added. 
This is where innovation plays a critical role. “In this fast-evolving world, you either adapt to stay ahead of the curve, or risk being left behind. Innovation does not have to be in technology - it can also be in changing the ways we do business and transforming mindsets.” 
Last but not least, it’s all about action, Seow pointed out. “Anyone who has worked with me will know that I get things done, and I do things the right way. I also prefer working with people who deliver results rather than excuses. It’s about taking action yourself, and not resting on your laurels, or waiting for someone else to do it for you.” 
A Bachelor of Science in Economics graduate from Singapore Management University, Seow spent nearly a decade of his career as a Senior Banker and Vice President of Structured Trade &amp; Commodity Finance in Societe Generale, Singapore.  He was appointed Fu Yu’s Group Managing Director in August 2021. 
“I learnt that regardless of my education and earlier work experience, I should avoid pigeonholing myself in a single industry to achieve success,” Seow recalled. 
“I went to a business school where most of the students aspired to be “investment bankers”. While I happily took that route for 10 years, I wanted to do more than what my colleagues and clients expected of me, and never shied away from working with others on projects outside my regular job. In hindsight, these experiences made me realise I had a penchant for business management, troubleshooting issues and creating solutions.” 
Although Seow may be seen as a “textbook finance expert”, he attributes much of his finance basics and business acumen to his experiences with start-ups, including co-founding and managing a restaurant in 2013, which has achieved and retained a Michelin star since 2017. 
“Nothing beats the “real-life” exposure of preparing and executing business plans, setting up accounts, managing capital expenditure and working cash cycles, retaining and motivating employees, as well as fire-fighting to ensure business continuity,” he added. In Growth Gear 
These cumulative experiences have equipped Seow well for his current role. “Fu Yu is a stable and classic manufacturing company that has been in operation for more than four decades,” he noted. 
“As Managing Director, I bring my go-getter, entrepreneurial, and proactive mindset to transform Fu Yu from a company that has been sailing steadily to one that is forward-thinking, innovative and in growth mode.” 
Starting out in 1978 as a small tooling design, fabrication and fitting shop, Fu Yu Corporation has since grown into a market leader, providing vertically integrated services for the manufacture of precision plastic components and the fabrication of precision moulds and dies. The Group was listed on SGX Mainboard in June 1995. 
Today, the Group has an established presence in the region with manufacturing facilities located in Singapore, Malaysia and China. It has built a broad and diversified customer base of blue-chip companies in the printing and imaging, networking and communications, consumer, medical, automotive as well as power tool sectors. 
Its comprehensive capabilities range from precision tool design and fabrication and precision injection moulding to secondary processes, such as silk screen printing, ultrasonic welding, heat staking and spray painting, as well as sub-assembly.  
Looking ahead, Fu Yu targets to boost growth in two ways - strengthening the Group’s capabilities and beefing up its talent pool. 
“We’ve launched several initiatives to expand our capabilities, such as technology and machine upgrades, a new innovation arm to work on modern products and designs, as well as improving efficiencies,” Seow said. 
“These “hardware” upgrades will work hand in hand with our corresponding “software” upgrades, as we upskill our employees and hire fresh talent to drive innovation within the Group.” 
With these initiatives, Seow expects a long growth runway for Fu Yu, where the organisation will not only be a manufacturer, but also a front-runner in advanced manufacturing and technology.  
“While we’ve always been known as a reliable pair of hands in manufacturing, these upgraded capabilities will enable us to work with our customers even more closely in areas of complex manufacturing and material science.” 
In parallel with its strategy to build a diversified product portfolio for business resilience and stability, Fu Yu intends to optimise its business mix to keep pace with current market trends, Seow noted. 
This will see the Group channelling greater resources towards boosting its business in market segments that display longer term stability and growth potential, such as medical, automotive, as well as eco-friendly and smart home consumer products. 
The Group’s manufacturing operations will also shift into higher gear as the redevelopment of its new factory in Singapore enters the final stages of completion. The plant is scheduled to begin operations in the third quarter of 2022, barring unforeseen circumstances. 
“With its adoption of Industry 4.0, this new “smart factory” will serve as a showcase of the Group’s advanced manufacturing capabilities,” he pointed out.  
“In addition to higher precision manufacturing capabilities and increased automation, our new factory will also feature seamless workflow across its tooling, moulding and assembly operations to achieve higher operational efficiencies and a reduced carbon footprint.” 
The Group is also in the process of broadening value-added services to customers. Its new division - Corporate Development - will work with research institutes in Singapore and other partners in the region to explore research and development (R&amp;D) programs, as well as identify commercially viable technologies to augment its manufacturing services. A Proactive Approach 
In this respect, COVID-19 has been a game-changer of sorts, Seow admitted. “COVID-19 was a timely reminder that we can never predict or pre-empt external conditions. However, we can control our own actions by proactively and continuously upgrading,” he added. 
“I want Fu Yu to be proactive and stay ahead of the curve, rather than be reactive, as that will then be too late. This is a mindset change which I am incorporating throughout the Group.” 
The pandemic also emphasised the need to have a greater control of one’s supply chain, or at least, have the ability to mitigate disruptions.  
“We’re taking things into our own hands to better manage our supply chain by centralising our procurement, which was previously done on a per site basis. To do this, we have already acquired and integrated a procurement company into the Group,” Seow noted. 
“We believe this is a differentiating factor from our competitors as it allows us to better manage our raw material prices and shorten lead times for delivery, which ultimately will benefit our customers and potentially attract new ones.” 
As for the Group’s Environmental, Social and Governance (ESG) goals, Seow is focused on optimising the Group’s energy consumption, which will help shrink its carbon footprint.  
“Some of the initiatives we’re working on include exploring the installation of solar panels in our factories, and integrating IoT technologies to improve real-time monitoring of utilities usage and machinery performance,” he said. 
“The challenge is to collect accurate data points that can be translated into useful information for our engineers to work on. With this, we can better measure and improve energy consumption by building an energy data model as a baseline which can be used to detect irregular utilities usage.” 
Apart from work, this 37-year-old father of a four-month-old son is passionate about golf. 
“I like how each game is different, even if you play at the same course. It doesn’t matter where your ball lands, because what matters most is the next shot, and how you proceed from the position you’re at, to the next position you want to get to. This applies in life as well.” 
Seow is also inspired by “a better me tomorrow”. “I try to be present in everything I do, which means being deliberate about learning from everything I experience, and making sure I am maturing and wiser every day.” 
And his advice to staff? “Be a do-er, don’t procrastinate and don’t make excuses,” he said. “Work hard, work smart, and always do the right thing.” Fu Yu Corporation Ltd 
Fu Yu provides vertically integrated services for the manufacture of precision plastic components and the fabrication of precision moulds and dies. Since its inception in 1978, the Group has grown to become one of the largest manufacturers of high precision plastic parts and moulds in Asia. Today, the Group has established a strong presence in the region with manufacturing facilities located in Singapore, Malaysia and China. Leveraging on over 40 years of operating history, the Group has built a broad and diversified customer base of blue-chip companies in the printing and imaging, networking and communications, consumer, medical, automotive and power tool sectors. 
The company website is: <a href="https://www.fuyucorp.com/">www.fuyucorp.com</a> 
Click <a href="https://www.sgx.com/securities/equities/F13">here</a> for the company's StockFacts page. 
For the year ended 31 December 2021 financial results, click <a href="https://links.sgx.com/1.0.0/corporate-announcements/NQ9V9NZN2W9OT5F1/703919_Fu%20Yu%20-%20FY2021%20News%20Release.pdf">here</a>. 
 

About kopi-C: the Company brew

Text: Jennifer Tan-Stanisic Photo: Company file kopi-C is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations. 
For previous editions of kopi-C: the Company brew, please click <a href="https://www.sgx.com/research-education/market-dialogues">here</a>.   
For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to <a href="https://c/Users/tanje/Desktop/Working%20Files/kopi-C/jennifer.t@sgx.com">jennifer.t@sgx.com</a>.
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    Fu Yu - MD


For banking and finance veteran David Seow, the African proverb “If you want to run fast, run alone. If you want to run far, run together” carries a particular resonance - it encapsulates his core management values of teamwork, communication, innovation and action.  
“Each person’s contribution matters, but only if we work together,” said the Group Managing Director of SGX-listed precision plastic components manufacturer Fu Yu Corporation Ltd.  
“Teamwork is key for an organisation to flourish. We need people who are able to complement each other’s diverse skillsets, and people who do their part properly to derive the right outcomes for everyone in the organisation.”  
In turn, good communication forms the bedrock of strong teamwork. “We should be unafraid to give constructive feedback, to seek advice to learn and improve, and work together to achieve common goals,” he added.  
This is where innovation plays a critical role. “In this fast-evolving world, you either adapt to stay ahead of the curve, or risk being left behind. Innovation does not have to be in technology - it can also be in changing the ways we do business and transforming mindsets.”  
Last but not least, it’s all about action, Seow pointed out. “Anyone who has worked with me will know that I get things done, and I do things the right way. I also prefer working with people who deliver results rather than excuses. It’s about taking action yourself, and not resting on your laurels, or waiting for someone else to do it for you.”  
A Bachelor of Science in Economics graduate from Singapore Management University, Seow spent nearly a decade of his career as a Senior Banker and Vice President of Structured Trade &amp; Commodity Finance in Societe Generale, Singapore.  He was appointed Fu Yu’s Group Managing Director in August 2021.  
“I learnt that regardless of my education and earlier work experience, I should avoid pigeonholing myself in a single industry to achieve success,” Seow recalled.  
“I went to a business school where most of the students aspired to be “investment bankers”. While I happily took that route for 10 years, I wanted to do more than what my colleagues and clients expected of me, and never shied away from working with others on projects outside my regular job. In hindsight, these experiences made me realise I had a penchant for business management, troubleshooting issues and creating solutions.”  
Although Seow may be seen as a “textbook finance expert”, he attributes much of his finance basics and business acumen to his experiences with start-ups, including co-founding and managing a restaurant in 2013, which has achieved and retained a Michelin star since 2017.  
“Nothing beats the “real-life” exposure of preparing and executing business plans, setting up accounts, managing capital expenditure and working cash cycles, retaining and motivating employees, as well as fire-fighting to ensure business continuity,” he added.  In Growth Gear   
These cumulative experiences have equipped Seow well for his current role. “Fu Yu is a stable and classic manufacturing company that has been in operation for more than four decades,” he noted.  
“As Managing Director, I bring my go-getter, entrepreneurial, and proactive mindset to transform Fu Yu from a company that has been sailing steadily to one that is forward-thinking, innovative and in growth mode.”  
Starting out in 1978 as a small tooling design, fabrication and fitting shop, Fu Yu Corporation has since grown into a market leader, providing vertically integrated services for the manufacture of precision plastic components and the fabrication of precision moulds and dies. The Group was listed on SGX Mainboard in June 1995.  
Today, the Group has an established presence in the region with manufacturing facilities located in Singapore, Malaysia and China. It has built a broad and diversified customer base of blue-chip companies in the printing and imaging, networking and communications, consumer, medical, automotive as well as power tool sectors.  
Its comprehensive capabilities range from precision tool design and fabrication and precision injection moulding to secondary processes, such as silk screen printing, ultrasonic welding, heat staking and spray painting, as well as sub-assembly.   
Looking ahead, Fu Yu targets to boost growth in two ways - strengthening the Group’s capabilities and beefing up its talent pool.  
“We’ve launched several initiatives to expand our capabilities, such as technology and machine upgrades, a new innovation arm to work on modern products and designs, as well as improving efficiencies,” Seow said.  
“These “hardware” upgrades will work hand in hand with our corresponding “software” upgrades, as we upskill our employees and hire fresh talent to drive innovation within the Group.”  
With these initiatives, Seow expects a long growth runway for Fu Yu, where the organisation will not only be a manufacturer, but also a front-runner in advanced manufacturing and technology.   
“While we’ve always been known as a reliable pair of hands in manufacturing, these upgraded capabilities will enable us to work with our customers even more closely in areas of complex manufacturing and material science.”  
In parallel with its strategy to build a diversified product portfolio for business resilience and stability, Fu Yu intends to optimise its business mix to keep pace with current market trends, Seow noted.  
This will see the Group channelling greater resources towards boosting its business in market segments that display longer term stability and growth potential, such as medical, automotive, as well as eco-friendly and smart home consumer products.  
The Group’s manufacturing operations will also shift into higher gear as the redevelopment of its new factory in Singapore enters the final stages of completion. The plant is scheduled to begin operations in the third quarter of 2022, barring unforeseen circumstances.  
“With its adoption of Industry 4.0, this new “smart factory” will serve as a showcase of the Group’s advanced manufacturing capabilities,” he pointed out.   
“In addition to higher precision manufacturing capabilities and increased automation, our new factory will also feature seamless workflow across its tooling, moulding and assembly operations to achieve higher operational efficiencies and a reduced carbon footprint.”  
The Group is also in the process of broadening value-added services to customers. Its new division - Corporate Development - will work with research institutes in Singapore and other partners in the region to explore research and development (R&amp;D) programs, as well as identify commercially viable technologies to augment its manufacturing services.  A Proactive Approach  
In this respect, COVID-19 has been a game-changer of sorts, Seow admitted. “COVID-19 was a timely reminder that we can never predict or pre-empt external conditions. However, we can control our own actions by proactively and continuously upgrading,” he added.  
“I want Fu Yu to be proactive and stay ahead of the curve, rather than be reactive, as that will then be too late. This is a mindset change which I am incorporating throughout the Group.”  
The pandemic also emphasised the need to have a greater control of one’s supply chain, or at least, have the ability to mitigate disruptions.   
“We’re taking things into our own hands to better manage our supply chain by centralising our procurement, which was previously done on a per site basis. To do this, we have already acquired and integrated a procurement company into the Group,” Seow noted.  
“We believe this is a differentiating factor from our competitors as it allows us to better manage our raw material prices and shorten lead times for delivery, which ultimately will benefit our customers and potentially attract new ones.”  
As for the Group’s Environmental, Social and Governance (ESG) goals, Seow is focused on optimising the Group’s energy consumption, which will help shrink its carbon footprint.   
“Some of the initiatives we’re working on include exploring the installation of solar panels in our factories, and integrating IoT technologies to improve real-time monitoring of utilities usage and machinery performance,” he said.  
“The challenge is to collect accurate data points that can be translated into useful information for our engineers to work on. With this, we can better measure and improve energy consumption by building an energy data model as a baseline which can be used to detect irregular utilities usage.”  
Apart from work, this 37-year-old father of a four-month-old son is passionate about golf.  
“I like how each game is different, even if you play at the same course. It doesn’t matter where your ball lands, because what matters most is the next shot, and how you proceed from the position you’re at, to the next position you want to get to. This applies in life as well.”  
Seow is also inspired by “a better me tomorrow”. “I try to be present in everything I do, which means being deliberate about learning from everything I experience, and making sure I am maturing and wiser every day.”  
And his advice to staff? “Be a do-er, don’t procrastinate and don’t make excuses,” he said. “Work hard, work smart, and always do the right thing.”  Fu Yu Corporation Ltd  
Fu Yu provides vertically integrated services for the manufacture of precision plastic components and the fabrication of precision moulds and dies. Since its inception in 1978, the Group has grown to become one of the largest manufacturers of high precision plastic parts and moulds in Asia. Today, the Group has established a strong presence in the region with manufacturing facilities located in Singapore, Malaysia and China. Leveraging on over 40 years of operating history, the Group has built a broad and diversified customer base of blue-chip companies in the printing and imaging, networking and communications, consumer, medical, automotive and power tool sectors.  
The company website is: www.fuyucorp.com  
Click here for the company's StockFacts page.  
For the year ended 31 December 2021 financial results, click here. 
 

About kopi-C: the Company brew

Text: Jennifer Tan-Stanisic Photo: Company file  kopi-C is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations.  
For previous editions of kopi-C: the Company brew, please click here.    
For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to jennifer.t@sgx.com.



Fu Yu: Staying Ahead of the Manufacturing Curve

Singapore

Fu Yu Corporation is a leading manufacturer and sub-assembler of high-end precision plastic and metal components and products, including injection molding and tool fabrication. The company provides vertically-integrated manufacturing services and supply chain management to customers in the life science, medical, consumer, automotive, and industrial sectors. Headquartered in Singapore, the company was founded in 1978.

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Fu Yu Corporation (FUYU SP)

NOL's Latest Potential Merger Discussions... Where is the [Partial] Exit for Temasek?

Another report of potential suitors made it to market on Friday, forcing NOL to disclose there have been talks with French carrier CMA and global...

Charles De Trenck

Digital disruption bifurcates traditional market segmentation

How should digital leaders advise businesses? Two ways: target the high and low ends of the market while allowing cannibalisation against their...

Bernard Leong

Spindex Industries (SPE SP): PrimeMovers Equity-Sponsored MBO at S$1.43

While the offer is attractive compared to historical trading ranges, it is light in comparison to peer and precedent transaction multiples....

Arun George

10 in 10 with Fu Yu Corporation - Precision Engineering for a Sustainable Future

10 in 10 with Fu Yu Corporation - Precision Engineering for a Sustainable Future 10 Questions for...

Singapore Exchange Ltd (SGX)

Fu Yu: Staying Ahead of the Manufacturing Curve

For banking and finance veteran David Seow, the African proverb “If you want to run fast, run alone. If you want to run far,...

Singapore Exchange Ltd (SGX)

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52-week Range

Market Cap (USDm)

P/E

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