New Issue: Keppel Limited launches new NC3 SGD Perpetuals at an IPG of 3.60%

Keppel Limited (Keppel) announced new NC3 SGD perpetuals at an initial price guidance (IPG) of 3.60%, for accredited and institutional investors only. These perpetuals come with reset dates 11 June 2029 and every 3 years thereafter, based on the prevailing SGD 3Y SORA-OIS (1.65% as of 4 June 2026) and an estimated initial spread of 1.95%. We also highlight that these perpetuals come with a step up of 100bps from year 3 onwards.

 
Proceeds from this issuance are used for financing requirements to refinance the issuer’s existing perpetuals (KEPSP 2.900% Perpetual Corp (SGD)). 

About Keppel Limited

Keppel Limited (Keppel) is a global asset manager and operator. Over the past several years, Keppel has transformed itself from a capital-heavy conglomerate, historically anchored by offshore rig-building and property development, into an asset-light business that earns recurring fees by managing investments for other parties.

 
Keppel has three main operating segments:

1) Infrastructure: the group’s largest profit contributor; this segment comprises an integrated power business (electricity generation and supply in Singapore) and a Decarbonisation & Sustainability Solutions (DSS) business that earns recurring revenue from long-term service contracts such as centralised cooling for residential estates.

2) Real Estate: an asset-light property solutions and fund-management business.

3) Connectivity: its digital infrastructure arm, spanning data centres and a subsea cable system, is positioned to capitalise on the AI and digitalisation wave.
   
Across all three, Keppel raises capital from investors (Limited Partners, or LPs) into private funds, REITs and a Trust, and typically co-invests its own money alongside them. This generates two recurring income streams — management fees, plus distributions and divestment proceeds from those stakes — which are central to the group's cash generation and credit profile.

To track the transformation, Keppel reports in two parts. The "New Keppel" is the go-forward business: the three segments above plus the asset management platform. Separately disclosed is everything being wound down — the Non-Core Portfolio for Divestment (mainly legacy offshore & marine rigs, the residential landbank & selected properties, and the M1 Telecom stake), targeted for substantial monetisation by end-2030. As these non-core assets are sold, the associated debt leaves Keppel's balance sheet, making the group progressively more asset-light and less leveraged.

Financial Highlights (FY2025, with 1Q2026 trends)

Note: 1Q2026 (ending 31 March 2026) is a voluntary business update with no detailed financials disclosed; financial figures herein are based on audited FY2025 (ending 31 December 2025) results, with 1Q2026 used only to substantiate directional trends.

Keppel delivered a strong FY2025. New Keppel’s net profit soared 39.0% YoY to S$1.1b (FY2024: S$793.0m), with improvements seen in all three operating segments: Infrastructure rose 18% YoY to S$803.0m, Real Estate soared 155% YoY (due to higher fair valuation gains) to S$273.0m, and Connectivity grew 17% YoY to S$175.0m. More importantly for credit investors, recurring income grew 21.0% YoY to S$941.0m, strengthening the quality of earnings for Keppel. Including the non-core portfolio, the overall net profit was S$789.0m, down 16% YoY, mainly due to a S$222.0m (non-cash) accounting loss on the proposed M1 Telecom sale (note: the proposed divestment regarding Keppel’s M1 stake was terminated on 22 May 2026). The trade-off here is that the S$1b Keppel expected to raise from M1 is delayed and part of this non-cash loss could be reversed in 2026. The 1Q2026 update confirms this trajectory: New Keppel net profit was only “slightly down YoY” (softer Real Estate contribution purely due to a base effect from one-off gains in 1Q2026), with recurring income again “edging up”.

Crucially, the fee-generative core continues to scale. Funds under Management (FUM) grew 8.0% YoY to S$95.0b for FY2025, with asset management net profit rising 15.0% YoY to S$189.0m. This momentum carried into 1Q2026: asset management fees rose to 13.0% YoY to S$108.0m across all three segments, with roughly S$400m of new FUM added and a further S$2.0b of LP commitments locked in. We also point out the DSS order book of S$7.6b as of 31 March 2026, which provides 10-15 years of recurring revenue visibility.

Looking ahead, we expect Keppel's forward revenue and earnings to be supported by several catalysts. In Infrastructure, the 600 MW Keppel Sakra Cogen Plant — fully contracted for 2026 and 2027 — is on track for generation readiness in 1H 2026, while management is positioned to secure more long-term power sales amid tight supply-demand. In Connectivity, we see growth from its data centre expansion, as well as the leasing out of its two remaining subsea internet cable lines, which it aims to sign up customers for in 1H 2026. We also think the ~S$2.0b of LP commitments and the S$36.0b deal flow pipeline should lift future fee income, which — together with the S$2.0–S$3.0b monetisation target — should sustain recurring income growth and the New Keppel's earnings moving forward.