Invest for a Sustainable Future, Impact Capital Asset Management

ICAM

Invest for a Sustainable Future

Impact Capital Asset Management

Established in August 2020, Impact Capital Asset Management Pte. Ltd. (ICAM) was conceived by seasoned professionals Deepak Mawandia and Atul Tetambe. Both have accumulated a wealth of knowledge and experience from their extensive tenures in the financial sector. In 2019, ICAM secured its RFMC license and subsequently introduced a technology-centric venture fund. By 2021, with the acquisition of its CMS license, ICAM witnessed steady growth in its assets under management. Presently, ICAM manages a portfolio exceeding USD 1 billion, diversified across various countries. Central to ICAM’s foundation is a commitment to offering a platform singularly dedicated to the best interests of its investor clients. The combined expertise of Deepak and Atul firmly establishes ICAM as a notable entity in the wealth management field.

Thematic (Sector/Industry)

<ul><li><p data-start="135" data-end="385">Singapore's EV charging network is impressive with ~15,300 chargers deployed, and COE quotas structured to accelerate electrification.</p></li><li><p data-start="135" data-end="385">But this growth has been driven more by regulation, subsidies, and public mandates than by genuine market demand.</p></li><li><p data-start="135" data-end="385">The bulk of adoption has come from corporate fleets (taxis, buses, and logistics operators) where high daily mileage makes electrification viable.</p></li></ul>

Singapore's EV charging network is impressive with ~15,300 chargers deployed, and COE quotas structured to accelerate electrification.But this growth has been driven more by regulation, subsidies, and public mandates than by genuine market demand.The bulk of adoption has come from corporate fleets (taxis, buses, and logistics operators) where high daily mileage makes electrification viable.

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

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<p><em><strong>Non- SGX Report: These equity research reports are not written by the SGX.</strong>&nbsp;SGX supports the distribution of the research reports by external contributors. Please refer to the Disclaimer in the attached report.</em></p>
<h2>PEC LTD.</h2>
<h3>Cash-rich</h3>
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<p>PEC is the largest single-source plant and terminal maintenance service provider in Singapore.</p>
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<p>Project Work (PW) orderbook grew at a 5-year CAGR of 3.4% to S$191mn in FY20. Topline anchored by S$200mn worth of recurring maintenance service (MS) revenue.</p>
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<p>Net cash is 76% of PEC’s market cap.</p>
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<p><strong>Company Background</strong></p>
<p>A local player since 1982, PEC is a plant and terminal engineering specialist with a footprint in nine countries. It is the largest single-source maintenance service provider in Singapore. Through its core businesses, PW (55% of FY20 revenue) and MS (44%), PEC caters to downstream customers in four main sectors: oil &amp; gas, petrochemical, oil &amp; chemical terminals and pharmaceutical in Southeast Asia and the Middle East.</p>
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<p><strong>Highlights</strong></p>
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<p><strong>Excluding impairments, PEC would have been profitable in FY20.</strong> 4Q20 performance was affected by lockdowns and closed borders, which restricted global trade and travel flows. Despite this, revenue grew 26% YoY in FY20. Excluding net impairment of financial assets of S$16.4mn inclusive of a S$10.7mn provision for long outstanding receivables in FY20, PEC would have been profitable due to higher PW revenue.</p>
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<p><strong>PW orderbook grew at a 5-year CAGR of 3.4% to S$191mn in FY20.</strong> PEC’s ability to sustain orderbook growth is attributable to its loyal customer base, cutting-edge equipment and systems and recognition as a reliable integrated engineering solutions provider.</p>
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<p><strong>S$200mn worth of recurring MS revenue</strong>. A typical PW project takes 1-2 years to complete. MS contracts last 3-5 years. MS revenue grew at a 5-year CAGR of 8.3% in FY15-FY19, to contribute 44% to FY20 group topline. As PW sales are lumpy, the growth in recurring MS income is expected to provide greater income visibility.</p>
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<p><strong>Net cash is 76% of market cap.</strong> Balance sheet remains healthy with net cash of S$81mn in FY20, close to 76% of its market cap. Net cash to equity is 37% and gross gearing is minimal at 8.9%. With strong cash generation and a robust balance sheet, expect consistency in dividend payments and potential share buybacks.</p>
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<p><strong>Leveraging Singapore’s strength as top 10 petrochemical hub.</strong> Singapore is the world's fifth-largest refinery export hub. It ranks among the top 10 globally by chemical export volume. Despite Covid-19, its chemical cluster attracted the second-largest amount of commitments in fixed asset investments in Singapore in 2020. Singapore will continue to work towards creating 1,400 new jobs and manufacturing value added (MVA) of S$12.7bn in its energy and chemical industry by 2025 through an Energy &amp; Chemicals Industry Transformation Map (ITM).</p>
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Non- SGX Report: These equity research reports are not written by the SGX.&nbsp;SGX supports the distribution of the research reports by external contributors. Please refer to the Disclaimer in the attached report.
PEC LTD.
Cash-rich







PEC is the largest single-source plant and terminal maintenance service provider in Singapore.


Project Work (PW) orderbook grew at a 5-year CAGR of 3.4% to S$191mn in FY20. Topline anchored by S$200mn worth of recurring maintenance service (MS) revenue.


Net cash is 76% of PEC’s market cap.






Company Background
A local player since 1982, PEC is a plant and terminal engineering specialist with a footprint in nine countries. It is the largest single-source maintenance service provider in Singapore. Through its core businesses, PW (55% of FY20 revenue) and MS (44%), PEC caters to downstream customers in four main sectors: oil &amp; gas, petrochemical, oil &amp; chemical terminals and pharmaceutical in Southeast Asia and the Middle East.





Highlights


Excluding impairments, PEC would have been profitable in FY20. 4Q20 performance was affected by lockdowns and closed borders, which restricted global trade and travel flows. Despite this, revenue grew 26% YoY in FY20. Excluding net impairment of financial assets of S$16.4mn inclusive of a S$10.7mn provision for long outstanding receivables in FY20, PEC would have been profitable due to higher PW revenue.


PW orderbook grew at a 5-year CAGR of 3.4% to S$191mn in FY20. PEC’s ability to sustain orderbook growth is attributable to its loyal customer base, cutting-edge equipment and systems and recognition as a reliable integrated engineering solutions provider.


S$200mn worth of recurring MS revenue. A typical PW project takes 1-2 years to complete. MS contracts last 3-5 years. MS revenue grew at a 5-year CAGR of 8.3% in FY15-FY19, to contribute 44% to FY20 group topline. As PW sales are lumpy, the growth in recurring MS income is expected to provide greater income visibility.


Net cash is 76% of market cap. Balance sheet remains healthy with net cash of S$81mn in FY20, close to 76% of its market cap. Net cash to equity is 37% and gross gearing is minimal at 8.9%. With strong cash generation and a robust balance sheet, expect consistency in dividend payments and potential share buybacks.


Leveraging Singapore’s strength as top 10 petrochemical hub. Singapore is the world's fifth-largest refinery export hub. It ranks among the top 10 globally by chemical export volume. Despite Covid-19, its chemical cluster attracted the second-largest amount of commitments in fixed asset investments in Singapore in 2020. Singapore will continue to work towards creating 1,400 new jobs and manufacturing value added (MVA) of S$12.7bn in its energy and chemical industry by 2025 through an Energy &amp; Chemicals Industry Transformation Map (ITM).

















Singapore

PEC Ltd. offers engineering services to the oil and natural gas production, petrochemical, pharmaceutical, and oil and chemical terminal industries.  The Company offers engineering, procurement, construction and/or construction management, and maintenance services.

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PEC Ltd. (PEC SP)

EV and Sustainable Transport

Singapore's EV charging network is impressive with ~15,300 chargers deployed, and COE quotas structured to accelerate electrification.

ICAM

(Non-SGX Report) PEC LTD: Cash-Rich

Non- SGX Report: These equity research reports are not written by the SGX. SGX supports the distribution of the research reports by external...

Singapore Exchange Ltd (SGX)

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52-week Range

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