Sembcorp Industries share price faces stink bomb

Recently, I was reading one of my old articles on Sembcorp Industries share price written in August 2020. Back then, Sembcorp Industries collapsed to $1.80 following the demerger with Sembcorp Marine. However, I made a bold prediction that Sembcorp Industries would hit $5. Fast forward to 29 May 2023, Sembcorp Industries share price finally crossed that magical $5 mark.

To be frank, the explosive form of Sembcorp Industries share price had been nothing short of a fairy tale in SGX. Apart from iFAST, Sembcorp Industries is one of the only few SGX stocks that captures the imagination of investors. The stark difference between the two stocks is that the bullish run of iFAST shares did not last long while Sembcorp Industries share price went from strength to strength.

Given the splendid form of Sembcorp Industries share price, credit should be given to the Group CEO, Wong Kim Yin, who joined the Group only in July 2020. During his short tenure, CEO Wong has been instrumental in transforming Sembcorp Industries’ portfolio from brown to green. For the past three years, the Group secured a slew of green energy contracts. These contract wins enabled Sembcorp Industries share price back to rocket its way past the pre-pandemic levels.

Notwithstanding the above, the sale of Sembcorp Energy India Ltd (SEIL) on 5 September 2022 briefly threatened to derail the form of Sembcorp Industries share price as the counter plunged from $3.50 on 6 September to reach a low of $2.80 on 25 October.

Evidently, the market had reacted negatively to the sale as most investors were expecting the management to list SEIL in India. After all, Sembcorp Industries tried to list the business unit in 2018 but had to postpone the listing because the Group bought over the remaining stakes of SEIL in December 2019. According to India regulations, the change in capital structure would require a re-file of IPO.

To break the fall of Sembcorp Industries share price, the Group resorted to a series of shares buybacks, entering into collaborations in new projects and made several strategic acquisitions on renewable assets in India and China. These efforts helped to revive the form of Sembcorp Industries share price.

Question now: can anything else hold back Sembcorp Industries share price? Year-to-date, Sembcorp Industries share price has been on a supersonic form, surging by an incredible 42%, making the counter one of the best performers (if not the best) in Straits Times Index (STI). It seems that not even the market turbulence brought forth by the US interest rate hikes, looming global recession or supply chain issues could disrupt the bullish form of Sembcorp Industries share price. In this article, I will share my insights on the outlook of Sembcorp Industries share price in 2023.Note that this is an opinion article and not meant to be a financial advice. Please do your due diligence or engage financial advisors before investing in the stock market. Furthermore, I am not vested in Sembcorp Industries share currently. Whether Sembcorp Industries share price will surge or collapse has no impact on me. Thus, this article is not meant to induce readers to make any form of investment decisions.

Sembcorp Industries share price faces baptism of fire

On November 8, 2022, shareholders approved the sale of SEIL, the India coal-fired thermal power business. Consequently, SEIL was classified as a disposal group held for sale and as a discontinued operation. Traditionally, the Conventional Energy segment provides the main bulk of the Group’s revenue and net profit. While Sembcorp Industries commits to transform its business to clean energy, it may be too [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]

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