Middle East investors, according to analysts, accounted for around 15.5% of the private fund capital raised by Keppel in FY2023 to FY2025. Further interest from these investors may be impacted. In addition, the two-month delay in completing Keppel’s sale of M1 to Tuas suggests possible delays in its asset monetisation bid amid this volatile environment. They now assume that Keppel will complete only $750 million in asset sales per year in FY2026 and FY2027, down from their earlier projections of $1.5 billion and $2 billion, respectively.
JP Morgan has downgraded Keppel from “overweight” to “neutral”, along with a lower target price of $12 from $13.10, given that the fighting in the Middle East was initially thought to be over quickly.
JP Morgan’s Mervin Song and Terence Khi, in their March 27 note, say they remain “confident in Keppel’s management”. However, the hostilities may dampen the growth in funds Keppel can attracas it shifts from a conglomerate to an asset manager.
