ST Engineering has reported a record-high orderbook and resilient margins, propelling its growth prospects. The company’s latest earnings for the first half of 2025 were in line with expectations, with the Defence & Public Security (DPS) segment surpassing margin forecasts. This performance is bolstered by robust revenue visibility, driven by growth in the Commercial Aerospace (CA) and DPS units, alongside expanding international defence orders amidst rising global defence spending.
The company’s target price has been revised to SGD9.10, up from SGD8.70, reflecting an 8% upside and a 2.2% yield forecast for the financial year 2026. Analyst Shekhar Jaiswal noted, “Record-high orderbook and solid revenue visibility, underpinned by growth in the Commercial Aerospace and DPS units, expanding international defence orders, and minimal exposure to trade tariffs reinforces the investment case in the stock.”
The company has also increased its earnings forecast for 2026 and 2027 by 3-4%, citing sustained margins in the CA and DPS segments beyond 2025. This adjustment includes a 4% premium for environmental, social, and governance (ESG) factors.
The announcement underscores ST Engineering’s strategic positioning in the global defence market and its ability to maintain strong financial performance despite external challenges. The company’s focus on expanding its international footprint and leveraging its core strengths in aerospace and defence continues to drive its growth trajectory. Looking ahead, ST Engineering’s robust orderbook and strategic initiatives are expected to sustain its growth momentum.
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