SG Movers for Thursday: Seatrium Ltd Leads the Pack as Top Gainer

We are pleased to present our analysis of the Singapore market's performance on Thursday, with a focus on Seatrium Ltd, which emerged as the top gainer among listed companies. Our article will provide insights into the key factors driving Seatrium Ltd's stock price movement and its significance in the broader market context.

Our analysis of the Singapore market on Thursday:

- Seatrium Ltd was the top gainer, with its stock price increasing by 4% following the announcement that the company had bought back more shares.
- The broader market showed a positive sentiment, with shares in Singapore surging ahead of the festive period, particularly in the energy sector, where Geo Energy Resources surged by 5%.
- Golar LNG also made headlines by acquiring minority interests in FLNG Hilli for $90.2 million and taking full ownership of the same project on the same day.

Key fundamentals and catalysts driving Seatrium Ltd's recent stock price movement:

1. Share Buyback: Seatrium Ltd's decision to buy back more shares signals the company's confidence in its financial position and may contribute to the stock price increase by reducing the number of outstanding shares. This move can also increase the earnings per share (EPS) for remaining shareholders, driving up the stock price.
2. Strong Order Wins and Revenue Visibility: Seatrium Ltd has secured a significant number of new contracts, totaling approximately S$5.3 billion year-to-date, which represents 88% of the full-year assumption of S$6 billion. This has lifted the order book to around S$20 billion, providing good revenue visibility for the next three years. The strong order momentum has positively impacted the stock price.
3. Improved Balance Sheet: Seatrium Ltd's net gearing has improved from 0.26x at the end of 2022 to 0.18x by the end of March 2023. This improvement in the balance sheet has enhanced the company's financial health and stability, contributing to the stock price increase.
4. Strategic Review and Integration: Seatrium Ltd is conducting a strategic review that is expected to be concluded by the end of the year. This review will cover integration planning and a capital structure review to ensure sustainable growth. The anticipation of potential revenue and cost synergies from the integration has positively influenced the stock price.
5. Analyst Optimism: Analysts have been optimistic about Seatrium Ltd's prospects, with some projecting a net loss for FY23 and a turnaround with small profits in FY24. This optimism could have contributed to the stock's rise on Thursday.

Seatrium Ltd's stock performance compared to the broader market:

- Over the past quarter (Dec 18, 2024 - Dec 24, 2024), Seatrium Ltd's stock price has increased by 4.08%, while the broader market has shown a 1.55% increase during the same period.
- Over the past year (Dec 24, 2023 - Dec 24, 2024), Seatrium Ltd's stock price has decreased by 16.95%, while the broader market has shown a 1.55% increase during the same period.

In comparison to the broader market, Seatrium Ltd's stock performance has been more volatile, with a significant decrease over the past year and a recent increase over the past quarter. However, it is essential to consider that the broader market's performance may not accurately represent the specific industry or sector in which Seatrium Ltd operates.

Conclusion:

Seatrium Ltd's strong operational performance, strategic initiatives, and positive market sentiment have contributed to its stock price increase on Thursday. The company's recent order wins, improved balance sheet, and strategic review have all played a role in driving its stock price up. As the company continues to execute on its strategic plan and deliver on its operational targets, investors can expect Seatrium Ltd to remain a key player in the Singapore market.