Brokers' take

Singapore Post | Buy

Target price: S$1.77

Oct 4 close: S$1.495

UOB Kay Hian Research, Oct 4

SINCE the unfolding of corporate governance issues in December 2015 and management changes, the share price of Singapore Post (SingPost) has retreated almost 30 per cent from its peak in early 2015. While some decline is warranted, we believe the market has not priced in its growth assets in e-commerce and logistics. We changed our valuation methodology from discounted cash flow to sum-of-the-parts to better reflect the valuation of each business segment. Upgrade to "buy" with a higher sum-of-the-parts target price of S$1.77 (previously S$1.53). . . We are cognisant that there remain uncertainties on SingPost, particularly with regard to the Alibaba second tranche investments, CEO change as well as lingering corporate governance conc…