ASEAN FIRST TO MARKET

Research evidence excerpt

ASEAN FIRST TO MARKET

Asia Pacific Equity Research

ASEAN First to Market 29 July 2026

Top Stories

| Seatrium (Terence M Khi) (STM SP, UW, PT S$1.60), Singapore

Orderbook burn outruns the margin turn; we assume coverage at UW

We assume coverage of Seatrium (STM SP) with an Underweight rating and Dec-27 PT of S$1.60, implying 32% downside

from the current price of S$2.36 on 28 July 2026. We believe the market underestimates orderbook replacement risk. Petrobras

FPSOs accounted for 58% of 2022-25 contract wins and 66% of 1Q26 gross orderbook, but Petrobras (covered by Milene

Carvalho, link) is shifting toward BOT structures that increases competition and dilutes STM’s scope capture. Despite assuming

S$7bn/S$6bn/S$5bn of contract wins in FY26/27/28 and margin improvement, we forecast core PATMI of S$474m in FY26E to

decline to S$414m in FY28E. STM is up 14.2% over the past five days, ahead of STI’s 1.2% rise, following the largely expected

1H26 positive profit alert for results on 31 July. We would look to trim into results as we would remain cautious until annual

order wins recover towards S$9bn, sufficient to support a S$10bn medium-term revenue run-rate.

ASEAN & Taiwan Telcos (Ranjan Sharma, CFA/Sigrid Qiu), Asia Pacific

Strong start to 2Q26 results

We have been of the view that the Street underestimates earnings growth at telcos during price repair. This has been clearly

seen in the Thai telcos since industry consolidation. 2Q26 results have further supported our view with stronger than expected

earnings growth at Taiwanese telcos and ISAT. In our view, ST, TRUE, and ADVANC are likely to see positive earnings

revisions with results over the coming quarters. We believe TDC is a structural growth story and earnings are likely to

compound for the foreseeable future.