Floating Button
Home Capital Broker's Calls

Frencken's $63 mil investment in new Singapore facility validates positive outlook: Maybank Securities

The Edge Singapore
The Edge Singapore  • 2 min read
Frencken's $63 mil investment in new Singapore facility validates positive outlook: Maybank Securities
Frencken remains Maybank Securities' top Singapore tech pick / Photo: Frencken Group
Font Resizer
Share to Whatsapp
Share to Facebook
Share to LinkedIn
Scroll to top
Follow us on Facebook and join our Telegram channel for the latest updates.
“yang” éfact "yang"

Jarick Seet of Maybank Securities has maintained his "buy" call and $1.34 target price on Frencken Group. The manufacturer's recent announcement to invest $63 million in a new facility in Singapore, according to Seet, is a validation of its positive outlook.

The new facility at Kaki Bukit, according to Frencken, will be ready by the first quarter of 2027. The company can then consolidate operations now at two different sites to this bigger space and to better support customers who want work done in Singapore.

According to Seet, Frencken is now limited by larger-size clean rooms here, which limits what it can do for one of its key customers in semiconductors.

By building larger clean rooms in the new Kaki Bukit facility, Frencken can then scale up its portfolio for such customers, and help shift work now done in Europe to Singapore.

"This would also point to higher margins due to lower production costs in Singapore as compared to Europe," says Seet.

"We continue to like Frencken and believe it will remain a key beneficiary of the recovery in the semiconductor industry. Its Singapore expansion bodes well amid on-going uncertainty created by the threat of higher US tariffs war due to tensions between the US and China," says Seet.

See also: Citi keeps ‘sell’ call on SGX but raises target price ahead of ‘well anticipated’ FY2025 results

He values this counter based on 13x FY2026 earnings, leading to a target price of $1.34.

"Frencken remains our top Singapore tech pick," says Seet.

Frencken shares changed hands at $1.17 as at 10.32 am, up 1.74%.

×
The Edge Singapore
Download The Edge Singapore App
Google playApple store play
Keep updated
Follow our social media
© 2025 The Edge Publishing Pte Ltd. All rights reserved.