SG : Keppel Corporation - Kris-talised

Pursuant to KrisEnergy’s filing of a winding up petition, KEP will book a loss of S$318m in respect of its exposures to KrisEnergy, based on recoverability. As a guarantor via a bilateral contract with DBS Bank, KEP is also liable to pay on demand the revolving credit facility of S$251m. The payment is likely to be covered by asset recycling. We also estimate c.S$309m of gains to offset the loss. Reiterate Add and TP of S$6.40. This could mark the last vestige of ‘legacy’ issue and remove the overhang on KEP as it has been plagued by KrisEnergy’s weak performance.

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