Discover SGX Stock: Sembcorp Industries – A Powerhouse of Growth and Sustainability

October 23, 2023

Sembcorp Industries Ltd (SGX: U96) is the top performer in the Singapore Exchange this year among the large-cap companies.

A leading energy, marine, and urban development group, Sembcorp Industries operates across multiple markets with a balanced energy portfolio and a stronghold in developing integrated urban solutions.

Sembcorp Industries has earned its reputation by strategically diversifying its business, thereby contributing significantly to Singapore’s economic development.

The company has its fingers on the pulse of the energy sector, developing both conventional and renewable energy solutions.

Excitement is growing as the world increasingly turns to renewable energy sources. Here are three reasons why investing in Sembcorp Industries might be a good idea.

1. Stable Clean Energy Net Profit

Sembcorp Industries anticipates stable net profit from its Clean Energy business due to the initiation of long-term contracts with notable clients like Micron and Singtel.

The increase in capacity under long-term contracts contributes to the predictability and reliability of revenue streams, safeguarding the company’s financial health against market volatility.

These contracts provide a buffer for new capacity coming online, potentially mitigating the impact of lower spot prices.

2. Diversified and Robust Growth in Renewable Energy

Sembcorp Industries has demonstrated substantial growth in its renewable energy profits, marked by a 54% year-on-year (YoY) increase in H1 2023.

This growth is attributable to both organic developments and strategic acquisitions, including stakes in Vector Green India, BEI Energy China, and Xingling New Energy China.

The diversified portfolio, spanning solar, wind, and energy storage globally, positions the company as a significant player in the renewable energy sector, offering potential for sustained growth as the demand for clean energy escalates.

3. Commitment to Sustainability and Portfolio Diversification

Sembcorp Industries’ steadfast commitment to sustainability and its balanced energy portfolio of 19.4 GW, including 11.9 GW of renewable energy capacity, make it an appealing investment for those looking to contribute to a greener future.

The company’s ongoing transformation towards sustainability, coupled with its proven track record of transforming raw land into sustainable urban developments, indicates its capability to adapt to market trends and meet the growing demand for eco-friendly solutions.

This alignment with global sustainability goals enhances its reputation and market presence, potentially leading to increased investor interest and value.

Moreover, Sembcorp Industries’ addition to the MSCI Singapore Index further validates its strong market standing.

Get on board with sustainable investing

Sembcorp Industries, with its diversified portfolio, strategic collaborations, and commitment to sustainability, stands as a compelling investment prospect on the SGX.

The company’s consistent financial growth, dividend increases, and promising future developments offer a multifaceted investment opportunity.

As we approach Sembcorp Industries’ Investor Day on 6 November 2023, investors have the chance to learn more about its updated renewables target and plans for sustainable profit growth.

Whether you are looking to buy or trade, diving into Sembcorp Industries offers a pathway to both financial rewards and sustainable development.

Seize the opportunity to be part of this progressive journey and make a strategic investment in a brighter, greener future.

Disclaimer: ProsperUs Head of Content & Investment Lead Billy Toh doesn’t own shares of any companies mentioned.

Billy Toh

Billy is deeply committed to making investment accessible and understandable to everyone, a principle that drives his engagement with the capital markets and his long-term investment strategies. He is currently the Head of Content & Investment Lead for Prosperus and a SGX Academy Trainer. His extensive experience spans roles as an economist at RHB Investment Bank, focusing on the Thailand and Philippines markets, and as a financial journalist at The Edge Malaysia. Additionally, his background includes valuable time spent in an asset management firm. Outside of finance, Billy enjoys meaningful conversations over coffee, keeps fit as a fitness enthusiast, and has a keen interest in technology.

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