Why are Sembcorp Industries shares rising?

The stock, which is up 8% this year, could rally another 32% in the next 12 months, analysts say.

  • Sembcorp Industries (SGX: U96) share price rose to S$1.86 on Thursday (07 October)
  • Its subsidiary Sembcorp Financial Services has successfully issued and listed S$675 million worth of 2.66% sustainability-linked notes
  • Analysts foresee a 32% price upside on the stock
  • Keen to take advantage of Sembcorp Industries’ rising share price? Open an account with us to go long on the stock now.

SCI stock price analysis: what’s the latest?

Sembcorp Industries (SCI) shares rallied as much as 2.2% on Thursday morning, following the successful issuance and listing of sustainability-linked notes on the SGX-ST.

Sembcorp Financial Services Pte Ltd, a wholly-owned subsidiary of SCI, issued S$675 million worth of 2.66% sustainability-linked notes due 2032 comprising Series 002 on 06 October.

The issuance came under the S$3 billion Multicurrency Debt Issuance Programme established by SCI and SFS .

The counter is down by over 4% in the last one month, but up roughly 8% year-to-date.

SCI shares currently have a consensus rating of ‘outperform’ and average target price of S$2.45 per share, according to the latest analyst data published by SGX StockFacts.

The price target equates to a potential 31.7% price upside.

CIMB analysts, in particular, are eyeing a price target of S$2.51 and ‘add’ call on Sembcorp Industries.

They stated in a 28 September note that SCI was one of its top three mid-cap Environmental, Social and Corporate Governance (ESG) picks for Singapore.

“It has a clear target to up profit from sustainable solutions and renewable energy to 10GW by 2025,” the analysts wrote.

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SCI signs MOU to deliver decarbonised hydrogen locally

Earlier this week, SCI subsidiary Sembcorp Utilities signed a strategic collaboration Memorandum of Understanding (MOU) with Japan’s Chiyoda Corporation and Mitsubishi Corporation, to explore the feasibility and implementation of a commercial-scale supply chain to deliver decarbonised hydrogen into Singapore.

The delivery will utilise Chiyoda’s proven hydrogen storage and transportation technology “SPERA Hydrogen”, which is able to release hydrogen from Methylcyclohexane (MCH1) safely for commercial use.

This MOU represents a strategically important step in the potential creation of a commercial-scale global supply chain for decarbonised hydrogen into Singapore.

The parties intend to undertake joint efforts to explore the most cost-effective hydrogen production in offshore locations for subsequent hydrogenation in these selected locations, and to ultimately ship MCH to Singapore for use.

Feeling bullish about SCI shares?

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