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Which Is The Best Keppel Company To Buy?

Keppel logoSingapore conglomerate Keppel Corporation (SGX: BN4) may not be quite as big as Jardine Group but it can certainly give the Hong Kong “hong” a good run for its money in terms of complexity.

In total, there are no fewer than ten listed companies connected with Keppel Corporation, of which seven bear the Keppel name. Their interests include rig building, ship repair, property development, logistics, telecoms, oil exploration and a Real Estate Investment Trust.

If that wasn’t enough, it also has a private-equity arm, K1 Venture (SGX: K01) too. Keppel Corp has certainly come a long way from the humble shipyard situated in Keppel Bay.

Over the last decade, Keppel Corporation has delivered a total annual return of 18%. In other words, every $1,000 invested in the company in 2004 would have turned into over $5,000 todays when dividends are included.

But that is not nearly as impressive as its Philippines property arm. Keppel Philippines Holdings (PSE: KPHB) has returned 21% over the same period. Meanwhile, its other property company in the Philippines, Keppel Philippines Property (PSE: KEP), has returned 17%.

Keppel has three other quoted property units, of which two are listed in Singapore, namely, Keppel Land (SGX: K17) and Keppel REIT (SGX: K71U). Keppel Land, whose developments include Marina Bay Residences and Pebble Bay, has not disappointed investors with a total annual return of 12.6% since 2004. Keppel REIT, which was listed eight years ago, has returned around 7%

Keppel Land also has a property division listed in Thailand, namely, Keppel Thai Property (SET: KTP). That division has not performed so well, though. Over the last ten years, the shares have dropped 80%.

There is more to Keppel than just property and ships. Keppel T&T (SGX: K11) is the logistics arm of Keppel Corp. It provides data storage facilities for clients and it also helps to manage supply chains for customers. As a support services business, Keppel T&T’s return of 11.5% is as good a return as, say, Singapore Post.

Keppel Corporation also has a significant interest in Singapore’s third-largest telecom company. M1 (SGX: B2F), in which Keppel has a 20% stake, has outperformed its larger peer SingTel (SGX: Z74). Over the last 10 year, the return as been around 16%.

KrisEnergy (SGX: SK3), another Keppel spin-off, floated on the Singapore market last year. At S$0.78, the shares are currently below the flotation price of S$1.10. But these are early days yet for the oil and gas explorer.

There is certainly more to Keppel than meets the eye. Investors with special insight into, say, telecom, property or even oil and gas exploration, may want to dig deeper into various parts of Keppel to, possibly, leverage a higher return. However, for many of us, backing the conglomerate might just be good enough.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore Director David Kuo doesn’t own shares in any companies mentioned.