Surprise, surprise: SingPost’s Alibaba deal bursts initial analyst assumptions

It might be way bigger than you think.

SingPost’s much-lauded Alibaba deal could be much bigger than anyone has ever anticipated.

According to a report by DBS Group Research, SingPost might secure $200m worth of business from Alibaba, beating the research group’s base case forecast of $50m.

“Our FY16F forecasts could be beaten if Alibaba is able to ramp up its in South-East Asia and both companies are able to integrate their back-end systems quickly. We estimate that our FY16F earnings could benefit 5-10% in that case,” the report stated.

Here’s more from DBS:

SPOST will get priority for Alibaba’s carriage business in South-East Asia. We have assumed ~S$50m worth of business from Alibaba in FY16F which could easily be exceeded if Alibaba is able to ramp up its South-East Asian business.

We estimate that our FY16F earnings could benefit 5-10% in that case. The deal could also result in SPOST securing more business from other e-commerce players.

With S$482m net cash, SPOST may acquire profitable logistics or last mile players to expand its reach in Indonesia and other countries. Assuming that SPOST undertakes S$300m worth of acquisitions at 12-15x PER, there could be S$20-25m or 15-20% added to our FY16F earnings.

Alibaba’s entry convinces us further that SPOST is well-positioned to benefit from e-commerce sales, which according to eMarketer is expected to see CAGR of 29% in Asia over the next 4 years.

If you've been wondering whether SBR could work for your company — yes, probably.

A lot of the companies we partner with started as readers. They'd been following our coverage for a while, saw their own customers and competitors in it, and eventually asked the obvious question: could we do something with you? The answer is usually yes. The shape of it depends on what you're trying to do.

The options are broader than most people assume — thought leadership articles, sponsored content, industry summits across Southeast Asia, regional awards programmes, podcasts, and media placements in print and digital. Some partners use one channel; most use a mix. We figure out the right combination by starting with your brief, not with our rate card.

So if the question has been on your mind, here's the easy way to ask it.

We'll tell you honestly whether we can help, and how. It's a better use of everyone's time.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia