Company Coverage
Pan-United Corporation (PAN SP): 1H26: Leveraging Market Leadership to Capture Industry Growth
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
S$1.53
S$1.88
+22.9%
S$1.42
Analyst
Highlights
- Pan-United’s 1H26 revenue and earnings beat expectations by 6% and 4%, driven by strong RMC volume growth and better operational efficiencies.
- The company declared a higher interim dividend of 1.5 S cents (+50% yoy), implying a higher total dividend payout for 2026 with a payout ratio of 60%.
- Maintain BUY with a 32% higher target price of S$1.88 (S$1.42 previously), pegged to an unchanged 17x 2027F PE.
Analysis
- 1H26 results ahead of expectations. Pan-United Corporation (Pan-United) reinforced its position as Singapore’s leading ready-mix concrete (RMC) supplier with an estimated 40% market share. 1H26 saw a record revenue of S$550m (+37% yoy) and net profit of S$31.3m (+49% yoy), exceeding our forecasts by 6% and 4%, respectively. The outperformance was largely driven by stronger-than-expected RMC volume growth in the group’s concrete and cement (C&C) business, supported by growth in construction activities in Singapore, Malaysia, and Vietnam. Gross margin improved marginally by 0.1ppt to 25.1%, while net profit margin rose 0.5ppt to 5.7% on higher operating efficiencies, supported by a favourable sales mix. The C&C segment grew 37% yoy to S$544m, with a segmental net margin of 6.1%.
- Higher interim dividend declared. Pan-United declared a higher interim dividend of 1.5 S cents/share (+50% yoy), potentially implying a higher 2026 total dividend, following five years of dividend growth. We continue to expect a dividend payout of around 60%, in line with 2025, implying a 3.3% dividend yield for 2026, and supported by a net cash position of S$65.2m.
- Capturing industry demand. As of May 26, Singapore’s demand for RMC grew 26% yoy to 6.75m m3, with RMC volume expected to reach 15m-16m m3 by end-26 (+3-9% yoy). Pan-United highlighted that its sales volume grew in line with the Singapore construction industry, re-emphasising its market leadership and ability to deliver and secure contracts over its peers.
Highlights
- Pan-United’s 1H26 revenue and earnings beat expectations by 6% and 4%, driven by strong RMC volume growth and better operational efficiencies.
- The company declared a higher interim dividend of 1.5 S cents (+50% yoy), implying a higher total dividend payout for 2026 with a payout ratio of 60%.
- Maintain BUY with a 32% higher target price of S$1.88 (S$1.42 previously), pegged to an unchanged 17x 2027F PE.
Analysis
- 1H26 results ahead of expectations. Pan-United Corporation (Pan-United) reinforced its position as Singapore’s leading ready-mix concrete (RMC) supplier with an estimated 40% market share. 1H26 saw a record revenue of S$550m (+37% yoy) and net profit of S$31.3m (+49% yoy), exceeding our forecasts by 6% and 4%, respectively. The outperformance was largely driven by stronger-than-expected RMC volume growth in the group’s concrete and cement (C&C) business, supported by growth in construction activities in Singapore, Malaysia, and Vietnam. Gross margin improved marginally by 0.1ppt to 25.1%, while net profit margin rose 0.5ppt to 5.7% on higher operating efficiencies, supported by a favourable sales mix. The C&C segment grew 37% yoy to S$544m, with a segmental net margin of 6.1%.
- Higher interim dividend declared. Pan-United declared a higher interim dividend of 1.5 S cents/share (+50% yoy), potentially implying a higher 2026 total dividend, following five years of dividend growth. We continue to expect a dividend payout of around 60%, in line with 2025, implying a 3.3% dividend yield for 2026, and supported by a net cash position of S$65.2m.
- Capturing industry demand. As of May 26, Singapore’s demand for RMC grew 26% yoy to 6.75m m3, with RMC volume expected to reach 15m-16m m3 by end-26 (+3-9% yoy). Pan-United highlighted that its sales volume grew in line with the Singapore construction industry, re-emphasising its market leadership and ability to deliver and secure contracts over its peers.
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
S$1.53
S$1.88
+22.9%
S$1.42
Analyst
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