Shares of Keppel Ltd advanced 3.7% to S$12.07 during Monday's session on the Singapore Exchange, approaching a recent high of S$12.12. The move marks the stock's strongest level in over a decade, driven by the company's latest financial results and shareholder return announcements.
Earnings and Dividend Details
The Singapore-based asset manager reported a net profit of S$1.1 billion for the full year, a 39% increase from the prior period. Funds under management grew 8% to S$95 billion. The board proposed a total distribution for FY2025 of approximately 47 Singapore cents per share, comprising a final dividend of 19 cents and a special dividend of 13 cents. The special component includes a cash portion and an in-specie distribution of Keppel REIT units.
Analyst Upgrades and Outlook
Several brokerages lifted their target prices following the report. Phillip Securities increased its target to S$13.80 with a 'buy' rating, while CGS International raised its target to S$13.52 and maintained an 'add' recommendation. Citi Research kept a 'buy' with a S$13.17 target. Analysts highlighted growth in asset management fees, disciplined cost control, and contributions from upcoming projects like the Keppel Sakra Cogen plant, scheduled for operation in the first half of 2026.
CEO Loh Chin Hua stated the company is focused on energy and connectivity solutions, capitalizing on trends like digitalization and artificial intelligence. The special dividend is linked to the monetization of non-core assets, representing 10% to 15% of proceeds from such sales.
Key Dates and Considerations
Keppel's annual general meeting is scheduled for April 17. The record date for the final and special dividends is April 28, with payment set for May 8. While the special dividend underscores strong capital returns, some observers note that reliance on asset sale proceeds introduces variability to future cash flows. Execution risks, such as project delays or shifts in the interest rate environment, could also impact the investment thesis.
The company's transition toward a more fee-focused business model aims to provide more stable earnings, though its ability to sustain momentum amid a changing macro backdrop remains a point of focus for investors.
