SingPost

SingPost: SingPost’s e-commerce CEO Marcelo Wesseler gave a business update yesterday.

The group reported a 60% y/y jump in Nov cross border e-commerce volumes to 4.6m packages. This included key holiday events such as China’s Singles Day, Black Friday and Cyber Monday.

Aside, the surge was also bolstered by greater marketing on SingPost’s international shipping service vPost as well as consumers in SE Asia and Australia taking advantage of overseas sales events.

Within SE Asia and Australia, domestic e-commerce sales ballooned 384% in Nov, thanks to Black Friday and Cyber Monday. This excluded orders from TradeGlobal and Jagged Peak, which are newly acquired by SingPost.

The top five categories of items purchased include fashion apparel, health and beauty, sportswear, consumer electronics and toys.

SingPost’s share price has taken a 15.8% beating from a recent high $1.935 in Oct. Apart from weak market sentiment, the stock was spooked by the abrupt resignation of CEO Wolfgang Baier, the poster boy of SingPost’s transformation story from an traditional mail provider into a leading regional e-commerce logistics provider.

Making matters worse are corporate governance lapses raised by academic Mak Yuen Teen and Business Times, which prompted SingPost to launch a special audit to investigate an interested party transaction in 2014. The group admitted that it had not disclosed independent director Keith Tay Ah Kee’s interests in Stirling Coleman Capital, the arranger of the acquisition of FS Mackenzie.

Until the CEO and corporate governance issues are settled, SingPost's share price could continue to face an overhang despite this solid set of e-commerce statistics.

SingPost is currently trading at 20.4x FY3/16e consensus P/E and offers a 4.1% indicative yield. Presently, the street has 5 Buy and 3 Hold ratings on the counter with a TP of $2.18.