For Lim & Tan’s Nicholas Yon, he forecasts profit to increase to $32.2 million and $35.8 million for FY2026 and FY2027 respectively. The TP is based on an unchanged 2027 forecasted P/E of 9.5 times. He notes a “bull-case scenario” whereby earnings could reach as high as $36 million and $39 million should contract wins and margins increase.
For the quarter ending Sept 30, ASL Marine announced revenue of $94.2 million and net profit of $8.3 million, a y-o-y increase of 12.1% and 1,560% respectively.
In her report issued on Dec 2, Mo wrote that the first quarter earnings formed 30% of full-year estimates and “beat our expectations”. The unexpected result was attributed to “stronger ship repair and shipbuilding contributions” as well as improved chartering margins and substantially lower finance costs.
Analysing the various business segments, both analysts are upbeat on ASL’s prospects and note that the shipbuilding segment remains anchored to the $83 million order book.
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For ship chartering, Mo expects gross margin to have “risen meaningfully toward the mid-teens, supported by the deployment of more vessels at higher day rates”. With the new $82m contracts secured in October 2025, she notes that chartering margins are expected to remain in the 10% to 15% range as utilisation rate improves throughout FY2026.
Meanwhile, Yon thinks there is also room for growth for the ship chartering segment as utilisation and charter rates improve while the company “renews older contracts at higher prices”.
Yon also believes that ship repair will be the “standout performer” as the company continues to capitalise on this high-margin and growing business.
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With tight drydock capacity across Singapore and Batam, coupled with “sustained demand” for ship maintenance and repair, Mo expects ship repair to continue to deliver “healthy volume growth”. She adds that the new floating dry dock that is scheduled to be completed in early FY2027 could lift the company’s performance in the medium-term.
Mo notes that the management has articulated a “clearer strategic focus” on ship repair and chartering which provides more sustainable recurring income in contrast to the cyclical nature of shipbuilding.
With ASL’s past participation in key national projects such as the Jurong Island Road Link and Pulau Tekong reclamation, she believes that ASL is well-positioned to earn contracts arising from Singapore’s $100 billion coastal protection plan, including Phases 3 and 4 of the Tuas Mega Port project and the Long Island Reclamation Project.
Another positive development noted by both analysts was the company’s focus on deleveraging, with recent vessel disposals part of a deliberate deleveraging effort. The company also confirmed that FY2025 marked the final year of significant non-cash loan amortisation, paving the way for lower finance costs ahead.
The company shared that financing costs decreased by $4 million as deleveraging efforts gained steam. Borrowings, which was once as high as $592 million in 2016, stood at less than $179 million as at 30 Jun 2025.
In an earlier report, Mo notes that the annual interest savings of $7million to $8 million are expected to lift ASL Marine’s net margins by three percentage points and accelerate free cash flow generation.
UOBKH also believes that the gains made by the company offsets the impact of the fire which occurred on Oct 25 at ASL Marine’s Batam yard. This was the second fire to occur at the yard this year. An earlier fire occurred on the same tanker in June at the yard.
Share prices could also get a boost should ASL Marine win more contracts and offer a higher dividend payout, notes Mo.
The counter’s share price closed flat at 25 cents on Dec 2.
