ST Engineering has secured a six-year sub-contract worth some $600 million from Abu Dhabi Ship Building (ADSB), adding to the momentum of defence contracts it is winning from overseas customers.
ST Engineering is to help design and supply the platform systems for a fleet of eight missile gun boats that ADSB is constructing for Kuwait's navy.
In addition to delivering the full suite of platform design, integration and technical expertise, ST Engineering will build three of the vessels at its Singapore shipyard.
This contract follows an earlier award in 2021 by ADSB for four similar offshore patrol vessels for the UAE Navy.
The missile gun boats will be based on ST Engineering’s own Fearless-class patrol vessel, in use by Singapore's navy.
ST Engineering had on Feb 27 indicated its confidence that having won $600 million worth of overseas defence contracts in 2025, it can double that amount this year. On the same day, the company announced it won a five-year maintenance contract from Qatar worth $470 million.
See also: ISOTeam secures $30.1 mil worth of new contracts; total order book stands at $186.5 mil
In his note on April 2, Jason Sum of DBS Group Research, citing higher margins from a more defence-weighted mix of new contracts, lifted his target price for this counter from $11 to $12.40, after he applied a higher multiple of 33x blended FY2026 and FY2027 earnings, up from 30x FY2026 earnings previously.
“This win strengthens ST Engineering’s growing momentum in international defence markets, underscoring the group’s ability to deliver sophisticated naval platforms and capture rising demand for advanced maritime security solutions in the Middle East,” says Tan Leong Peng, president of the marine business at ST Engineering.
“We are honoured that the Kuwait Naval Force has chosen our Fearless-class design for their new missile gun boat. The growing acceptance of our design across the Middle East, in Oman, UAE and now Kuwait, reflects customer confidence in its robust operational performance and adaptability”, he adds.
ST Engineering shares, having received a new wave of upgrades from analysts in recent weeks, closed at $11.10, up 2.68% for the day.
