OCBC Research upgrades Sembcorp Industries' issuer profile

Singapore

OCBC Credit Research on Friday upgraded Sembcorp Industries (SCI)'s issuer profile to "neutral", on the back of the recently announced two-part deal that will see Sembcorp Marine (SMM) separated from its parent company.

OCBC is of the view that the proposed deal is credit positive for SCI as the separation of SMM could see SCI's return on equity increase to 7.9 per cent on a pro forma basis, compared with 3.5 per cent in 2019.