• Since its founding in 1980, Tai Sin Electric has built a formidable moat in Southeast Asia by manufacturing the cables and wires that keep the lights on and the data flowing. • With manufacturing plants in Singapore, Malaysia and Vietnam, Tai Sin's business spans four segments—Cables, Electrical Distribution, Switchboards, and Testing—creating a vertically integrated machine.
• So now, CGS International has become the first to initiate coverage of the stock. After many years of being off the radar of investors, Tai Sin sure warrants a close look.... |
Excerpts from CGS report
Analysts: Then Wan Lin & William Tng, CFA
■ TSE benefits when M&E works move into execution stage, positioning it as a late-cycle beneficiary of Singapore’s construction boom.
■ The acquisition of Integra R.E. expands TSE’s renewables distribution footprint in Thailand and Philippines, with c. 2-3% FY26-28F EPS accretion. ■ Initiate coverage with an Add and TP of S$0.74, pegged to 10x FY27F P/E, based on its 10-year historical average 12-month forward P/E. |
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A construction boom, like the one thriving in Singapore currently, significantly benefits Tai Sin. Amplying this opportunity is a mushrooming of data centres in Southeast Asia.
A beneficiary of ASEAN public and data centre build‑out
Tai Sin Electric (TSE) is one of Southeast Asia’s leading cable and wire manufacturers and distributors; we estimate that it holds a 20-30% market share in Singapore for locally manufactured power cables.
Its production plants in Singapore allow it to secure large public sector projects; it has supported more than 70% of data centres built in Singapore to date.
TSE typically sees a boost in delivery volume 1 to 2 years after mechanical and electrical (M&E) contractors (TSE’s customers) win contracts, as cable demand is synchronised with the execution/installation phases of projects. 
FY ends 30 JuneMeanwhile, data centre (DC) and hyperscaler expansion in Singapore, Johor and Vietnam continues apace, driven by AI compute power requirements.
TSE could win more projects from the upcoming Jurong Island green DC park, which we believe will host next-generation low-carbon data centres.
We expect its cable and wire (C&W) segment to remain a core growth driver, contributing >67% of revenue and >50% of incremental revenue growth in FY26F-28F.
Value-accretive acquisition of Integra R.E.
TSE acquired the Thailand and Philippines operations of Integra R.E. (renamed from Baywa r.e. Solar Systems) for a purchase consideration of S$16m, completed in Nov 25.
We expect this to bring additional revenue of S$31m/S$53m in FY26F/27F, contributing additional 5-8% to the group’s revenue for the forecasted periods.
Assuming a net margin of 2%, we believe the acquisition will be EPS accretive by 2-3% for the forecast period.
Potential synergy includes the cross‑selling of solar modules, inverters and batteries through TSE’s well‑established distribution channels.
We believe TSE is currently enjoying multiple tailwinds (ASEAN data centre rollout, Singapore public infrastructure boom, etc), supporting its FY25-FY28F net profit CAGR of 11%.  Then Wan Lin, analystWe initiate coverage on TSE with an Add and a target price of S$0.74, pegged to 10x FY27F P/E (its 10-year historical average 12-month forward P/E). TSE now trades at 8x CY26F P/E, lower than regional peers (13x). We believe it will continue paying dividends of 2.35 Scts (unchanged since FY22) for FY26-28F as its operating cash flow is likely sufficient to fund working capital needs with minimal capex going forward. |
Re-rating catalysts:
1) stronger-than-expected topline growth,
2) margins expansion from copper price tailwinds,
3) better-than-expected dividend and
4) corporate actions.
Downside risks: steeper copper price hikes resulting in GPM compression, losing market share to competition, dividend halt.
→ See also: This Company Benefits from Both SG’s Construction Surge and Regional Data Centre Boom
