Edison Issues Initiation on Singapore Post: Transformation to Global Logistics Player Unnoticed

London, UK, 20 May 2024—Edison Investment Research Limited has released a new report on Singapore Post (SingPost), highlighting its ongoing transformation from a post and parcel delivery company to a global logistics operator. Despite this significant shift, the development seems to have gone largely unnoticed by investors.

According to Edison, this transformation provides a unique opportunity for investors to reassess SingPost's potential. The company's expansion into the Australian logistics market is noted as a key driver for long-term growth. Additionally, concerns about structural weaknesses in postal volumes may be mitigated by growth in e-commerce volumes and a constructive review of postal services.

The March 2024 strategic review, carried out by Bank of America, has identified non-core or underperforming assets within SingPost that could be targeted for capital recycling. SingPost's non-core assets in Singapore are posited to be of similar value to the company's entire market capitalization. Edison values the company at S$0.72 per share, implying a 50% upside from the current share price.

Edison sees further upside potential if the company successfully implements the strategic review recommendations, resulting in a more focused growth trajectory.