Here’s why analysts think SingPost isn’t quite a formidable e-commerce player yet

Its transformation is far from over, analysts said.

The mailman’s move to evolve from a domestic-mail monopoly into an international e-commerce logistics provider is a necessary one, but its metamorphosis is far from even halfway done.

According to a report by Maybank Kim Eng, although it now provides various e-commerce logistics services in the Asia Pacific, most of its acquisitions have not added much to synergies or earnings.

Maybank Kim Eng noted that it foresees a long gestation period for SingPost’s M&As, as its acquired businesses are small players in their fields facing intense competition and they have only diversified and bumped up its revenue but not yet added much to earnings.

Additionally, Maybank Kim Eng said that more investments would be needed for its customer acquisitions and scale economies.

Meanwhile, Alibaba’s second investment in the mailman seems to be at risk and is taking much longer than its first one in 2014, being extended thrice.

“SingPost attributed the delays to slow regulatory approval. We see risks of the deal falling apart, as Alibaba might choose to expand its ASEAN logistics capability in-house using Lazada’s own logistics network,” the report added.