Reaping time has come for SingPost’s M&As, say analysts

It will focus on integrating its acquisitions.

It’s now time to realise the benefits for Singapore post after three years of active mergers and acquisitions.

According to analysts from UOB Kay Hian, SingPost shared that its focus in the near-term focus will be on integrating and realising synergies from these acquisitions.

“Nonetheless, the company remains open to opportunistic investments that are in line with the SPOST 3.0 strategy,” UOB Kay Hian said.

Additionally, UOB Kay Hian said the recent acquisitions of TradeGlobal and Jagged Peak will allow Singapore Post to increase its exposure to the monobrand segment and expand into the US market alongside Asia-based e-commerce clients.

Meanwhile, capital expenditure is anticipated to remain high for 2016 at $396.3m for SingPost with the redevelopment of Singapore Post Centre (SPC), construction of the e-commerce

Logistics Hub, as well as the continuing investment in the POPStation network, UOB Kay Hian said.

“Nevertheless, we understand SPOST is committed to deliver its target full-year DPS of 7.0 S cents/share, implying FY16F dividend yield of 3.6%,” UOB Kay Hian said.