Low Keng Huat (Singapore) Limited (“LKH”, SGX:F1E) has suddenly gone from sleepy value stock to front‑page M&A story.
In the space of a few weeks, the mainboard-listed construction and property developer has:
- Reported a sharp swing into loss for the first half of FY2026
- Received a voluntary conditional general offer at S$0.72 per share from its managing director’s vehicle, aiming to delist the company [1]
- Seen a value investor publicly argue the offer is too low, citing a revalued NAV (RNAV) of S$1.37 per share [2]
- Appointed ZICO Capital as independent financial adviser (IFA) to opine on the fairness of the offer [3]
As of 8 December 2025, shareholders are sitting in the middle of a tug‑of‑war between near‑term liquidity at S$0.72 and arguments that the group’s asset base justifies a much higher price.
This article pulls together the latest news, financials, forecasts and independent analyses to give a structured view of where Low Keng Huat stands right now – and the key scenarios from here.
Nothing below is investment advice. It’s information and analysis to help you frame your own decisions or discuss with a licensed adviser.
1. Company snapshot: what Low Keng Huat actually owns
Low Keng Huat is a 1969‑founded builder turned boutique developer with three main business lines:
- Property development – most recently the luxury freehold condo Klimt Cairnhill, which is now fully sold and 99% completed as at 31 January 2025 [4]
- Hospitality & serviced apartments – including Citadines Balestier, lyf @ Farrer, and Duxton Hotel Perth [5]
- Investment properties – notably Paya Lebar Square (retail/office mall) and office units at Parkway Parade [6]
A 2024 tender win for a residential land parcel at Canberra Crescent adds another development site into the pipeline. [7]
On the ESG side, the group has been leaning into sustainability reporting and climate risk:
- Reporting aligned to GRI 2021 and the TCFD climate disclosure framework
- Working towards ISSB climate standards by FY2026
- Installing EV charging stations at Citadines Balestier and using battery energy storage (“Enertainer”) on construction sites to reduce diesel use [8]
So beneath the “small cap contractor” label sits a concentrated but fairly modern portfolio of Singapore and Australian real estate, plus some greenish credentials to keep regulators and institutional investors happy.
2. Latest numbers: FY2025 profit… then a sharp H1 FY2026 loss
FY2025 (year ended 31 January 2025): big revenue, thin profit
For FY2025, Low Keng Huat reported:
- Revenue: S$482.7 million (up 31% from S$367.7 million in FY2024)
- Profit after tax: S$2.6 million (vs a loss of S$1.0 million in FY2024)
- Profit attributable to shareholders: S$2.1 million
- EPS: about 0.28 Singapore cents per share [9]
The growth was almost entirely about Klimt Cairnhill:
- Property development revenue surged to S$415.8m (from S$297.3m) as the project moved from 27% to 41% completion and all 138 units were sold by 31 January 2025. [10]
- Hotel revenue inched up to S$47.9m, with Duxton Hotel Perth offsetting weaker contributions from the Singapore serviced apartments and the Carnivore restaurant. [11]
- Investment segment revenue fell to S$19.0m as construction revenue on the Dalvey Haus project dropped off after completion; Paya Lebar Square itself did slightly better on positive rental reversions. [12]
Despite the huge top line, net profit was modest. Margins were squeezed by:
- Higher construction costs on Klimt
- Distribution expenses (agents’ commissions) jumping to S$23.2m
- Fair value losses of about S$2.8m on an Australian property fund
- Other losses including FX and impairments [13]
Still, the company felt confident enough to declare a first and final tax‑exempt dividend of S$0.015 per share, payable in June 2025. [14]
At the offer price of S$0.72, that dividend works out to a trailing yield of ~2.1% – assuming (which is a big if) that such payouts continue post‑privatisation.
1H FY2026 (six months ended 31 July 2025): revenue cliff, loss of ~S$10m
The hangover came quickly.
For 1HFY2026 (the first half of the current financial year), LKH reported:
- Revenue: S$38.7m, down a brutal 85% from S$257.9m in the prior‑year period
- Net loss: about S$10.2m attributable to shareholders (vs profit of S$5.8m a year earlier)
- Basic EPS:‑1.38 cents [15]
The reasons are pretty textbook for a single‑project developer:
- Klimt Cairnhill is effectively done. Property development revenue fell from S$225.4m to just S$6.9m as only the final 1% of revenue was recognised after TOP in March 2025; construction costs continued as the project finished up. [16]
- Hotels were mixed. Duxton Hotel Perth improved with better room rates, but lyf @ Farrer and Citadines Balestier saw lower average daily rates, pulling the segment’s revenue slightly down to S$22.6m. [17]
- Investment properties saw revenue dip to S$9.2m as a tenant exited at Paya Lebar Square; the space was re‑let immediately, but at a lower rent. The mall still maintained 100% occupancy. [18]
There were also:
- Higher other losses, including a write‑off of air‑conditioning assets at Paya Lebar Square as they were replaced with more efficient units, and FX losses from Australian dollar exposure [19]
- A tax expense of S$2.6m, largely linked to Klimt Cairnhill’s cumulative profits becoming taxable on TOP [20]
In short: FY2025 was the “big harvest” year for Klimt Cairnhill; 1HFY2026 is the valley after the peak – and the numbers fully reflect that.
3. The S$0.72 privatisation and delisting offer
Who is making the offer and at what terms?
On 28 November 2025, the company announced a voluntary conditional general offer (VGO) to acquire all shares in Low Keng Huat at S$0.72 per share in cash. The offer is being made via Consistent Record Pte. Ltd., a special purpose vehicle effectively controlled by managing director Marco Low Peng Kiat and his family. [21]
Key points from the offer and accompanying coverage:
- Price: S$0.72 per share
- Premium to last traded price before announcement (S$0.615):17.1%
- Premium to 24‑month VWAP: about 45.2% [22]
- Pre‑offer stake: the Low family and concert parties have a deemed interest of ~54.13% of total shares [23]
- Minimum acceptance condition: offeror must end up with at least 90% of total voting rights (excluding what it already owns) – the classic threshold for delisting and potential compulsory acquisition [24]
The rationale, as set out in the offer documentation and repeated in media coverage:
- LKH hasn’t needed equity capital for years – it last raised equity in 2007, relying since then on bank loans and other debt. [25]
- Delisting would save listing‑related costs and reduce the burden of public‑market compliance. [26]
- Management argues it would gain greater flexibility for long‑term capital allocation and could better navigate a “challenging macro and operating environment” away from quarterly‑results pressure. [27]
Market reaction so far
The stock wasted no time in pricing in the bid:
- On 1 December 2025, shares jumped 17.1% to S$0.72 intraday and closed at S$0.715, up 16.3% on the day. [28]
- Over the past 12 months, the share price has climbed roughly 139%, outperforming the FTSE Developed Asia Pacific index by about 93 percentage points. [29]
Recent data from Stockopedia indicates the share last closed around S$0.73, slightly above the offer price, suggesting the market is toying with the idea of either a sweetened bid or the value of interim dividends if the process drags on. [30]
With roughly 739 million shares in issue, the offer values the company’s equity at just under S$540 million. [31]
4. ZICO Capital appointed as IFA – what that means
On 5 December 2025, LKH’s board announced it had appointed ZICO Capital Pte. Ltd. as the independent financial adviser (IFA) for the offer. [32]
- The IFA’s job is to issue an opinion on whether the S$0.72 offer is “fair and reasonable” to minority shareholders under the Singapore takeover framework.
- The board has said it will issue a circular to shareholders, including the IFA’s opinion and the independent directors’ recommendation, after the formal offer document is despatched by the offeror. [33]
Under the Code on Take‑overs and Mergers, the offer document typically goes out 14–21 days after the initial announcement, implying shareholders should receive the paperwork around mid‑December 2025. [34]
This circular will be a key document: it will likely crystallise the official view on NAV, RNAV, comparables and takeover precedents, and set the tone for whether a price bump is likely or not.
5. Is S$0.72 fair? The valuation tug‑of‑war
The market debate has crystallised into three main camps:
- NAV & RNAV say it’s too cheap
- Trading multiples and share‑price history say it’s generous
- Operational risks and cyclicality justify a discount
5.1 Book value vs offer price
According to an analysis in The Business Times, LKH’s net asset value (NAV) as at 31 July 2025 was around S$0.79 per share – about 9.7% above the S$0.72 offer price. [35]
That means:
- The offer is effectively at a discount to stated book value, even after a multi‑year residential boom in Singapore.
- For a company with a portfolio of stabilised investment assets and a fully sold luxury condo project, that discount is precisely what some investors are pushing back against.
5.2 Value investor Chua Bock Eng’s RNAV of S$1.37
On 2 December 2025, The Edge Singapore reported that value investor Chua Bock Eng had written to LKH’s board urging the independent directors to seek a better price. [36]
His key points:
- He estimates LKH’s revalued net asset value (RNAV) at about S$1.37 per share.
- He argues that many of the group’s assets are legacy properties carried at historical cost, significantly below market prices.
- While he accepts that privatisation offers rarely reflect full RNAV, he suggests that the gap between S$0.72 and S$1.37 leaves “ample room” for a higher bid.
- At minimum, he believes a “fair compromise” should at least match the book value of S$0.79, rather than price below it. [37]
If his RNAV estimate is anywhere near correct, the offer values LKH at barely half of underlying property value on a mark‑to‑market basis.
5.3 Dr Wealth: P/B at 0.91x – historically rich, and “fair enough”
On the other side of the debate, a detailed article on Dr Wealth (published 3 December 2025) takes a more pragmatic stance. [38]
Key observations from that piece:
- At S$0.72, LKH’s price‑to‑book ratio is about 0.91x, well above its historical mean of around 0.56x since May 2021.
- Anyone who bought the stock at almost any point in the last decade is likely sitting on a profit at the offer price, after years of the share price “lagging behind”.
- The author flags that revenue and profits have been volatile and project‑driven, with the recent 1H FY2026 loss of S$10.2m highlighting the downside of relying heavily on one flagship condo project. [39]
His conclusion:
The offer looks “good and fair” and is “a win‑win for both retail investors and the owners”, though there is limited upside for traders hunting for a quick squeeze. [40]
In other words: yes, you’re probably selling below RNAV, but you’re also cashing out at a valuation the market has historically refused to grant this stock.
5.4 Business Times: weak near‑term prospects vs strong 15‑year returns
A Business Times opinion piece on 4 December 2025 adds more nuance:
- It notes that LKH’s total shareholder return over the past 15 years has actually outpaced the Straits Times Index and large‑cap property names like CDL, Hongkong Land and UOL, thanks to past dividends and capital gains.
- It highlights the S$10.2m loss in 1H FY2026, the 85% collapse in revenue, and the inherent volatility in project‑based earnings. [41]
The underlying message:
- The track record is better than the gloomy narrative suggests, but
- The earnings outlook looks weak until fresh projects (like Canberra Crescent) meaningfully replace Klimt Cairnhill.
So you have a company with good long‑term shareholder returns, patchy earnings, and a big project gap – being bid for by insiders at a price that is generous versus its own history, but stingy versus the balance sheet.
6. Forecasts, external models and lack of broker coverage
If you go hunting for classic “BUY with target price S$X” research, you’ll be disappointed.
- SGInvestors shows no analyst target prices for LKH. [42]
- Stockopedia similarly reports no consensus recommendation. [43]
This is fairly typical for mid‑cap property names on SGX that haven’t been in the limelight – until a privatisation comes along.
What you do find are:
- Quant / retail platforms that algorithmically forecast short‑term prices. One such site, WalletInvestor, projects a 14‑day price of about S$0.748 – essentially assuming the share price hovers just above the offer level. [44]
- Fundamental screeners like Simply Wall St, which summarise trailing numbers rather than issuing explicit price targets. Their data indicate:
- Earnings have been shrinking at an average rate of ~‑55% per year over five years
- LKH is currently unprofitable on an LTM basis, with net margin around ‑5.3% and ROE about ‑2.2%
- The last earnings update date is 31 July 2025, i.e. 1HFY2026 [45]
Taken together, the “forecast picture” looks like this:
- No institutional broker coverage to anchor fair value.
- Quantitative models assume price drifts around the S$0.72 anchor.
- Fundamental platforms see a cyclical, currently loss‑making real‑estate operator, which they treat with caution.
The real forecasting challenge here is binary:
- Scenario A: privatisation succeeds at S$0.72 (or a slightly higher sweetened price), and the listed story ends.
- Scenario B: privatisation fails, and investors have to value LKH as a continuing, lumpy developer/investor with a new project cycle starting.
7. Strategic outlook: what happens if LKH doesn’t disappear from SGX?
Stripping out the takeover noise, how does the business look on its own merits?
7.1 Property development: post‑Klimt, pre‑Canberra
- Klimt Cairnhill is essentially over from a P&L perspective: fully sold, 99% complete as at Jan 2025, TOP in March 2025. Future contributions will be minor. [46]
- The next major development leg is likely to be the Canberra Crescent residential project, awarded in July 2024. Details on pricing and margins are still sparse in public documents, but the land award at least ensures the land bank hasn’t gone to zero. [47]
- LKH also holds a 30% stake in Peak Crescent Pte. Ltd., a joint venture associated with another project; early losses in 1HFY2026 reflect initial‑phase expenses there. [48]
The near‑term reality: development revenue will remain subdued until Canberra and other pipeline projects reach launch and construction milestones.
7.2 Hospitality: steady, but not spectacular
- Duxton Hotel Perth has been the bright spot, with higher average daily rates driving better revenue in FY2025 and 1HFY2026. [49]
- Citadines Balestier and lyf @ Farrer have struggled with weaker room rates, despite decent occupancy.
- In 1HFY2026, the hotel segment actually swung from a S$1.1m loss to a S$0.4m operating profit, thanks to lower depreciation and finance costs and improved Perth performance. [50]
If Singapore tourism continues to recover and Perth remains resilient, the hotel portfolio could provide slow‑and‑steady cash flow, but it is unlikely to fully replace a Klimt‑sized development profit anytime soon.
7.3 Investment properties: Paya Lebar Square and friends
- Paya Lebar Square remains fully occupied, with positive rental reversions but some rent pressure when tenants churn. [51]
- The group has made Green Mark Gold Plus progress and is upgrading A/C systems to more efficient models, which should help with both ESG credentials and long‑term opex, even though it caused some write‑offs in 1HFY2026. [52]
Investment properties provide recurring income, but not at a scale that makes LKH look like a big REIT. They’re more of a stabiliser in an otherwise project‑heavy earnings profile.
7.4 Balance sheet & debt
- Management has historically used leverage but not in an obviously reckless way; Dr Wealth’s analysis notes that debt ballooned in 2020 (COVID era) and has since tapered, with the debt‑to‑equity ratio trending down. [53]
- Finance costs dropped from S$27.5m in FY2024 to S$22.1m in FY2025, and again in 1HFY2026 as borrowings and interest rates eased. [54]
Put bluntly: this is not a balance sheet that screams distress. The bigger concern is earnings visibility, not solvency.
8. Key risks from here (offer or no offer)
Regardless of whether you’re thinking about holding out, selling, or just academic curiosity, several risk vectors are worth noting:
- Execution risk on new projects
- Canberra Crescent and future developments need to be executed well in a post‑cooling‑measures, higher‑rates environment.
- Any mis‑timing on launches or cost overruns would hit margins hard. [55]
- Earnings volatility and single‑project concentration
- The swing from FY2025 profit to 1HFY2026 loss is exactly what you expect when one project dominates the P&L. [56]
- Currency and valuation risk from overseas exposure
- The group has already booked both fair value losses and FX losses related to its Australian property fund and Duxton Perth exposure. [57]
- Privatisation process risk
- If the offer succeeds, minorities who don’t accept may eventually be squeezed out or end up holding illiquid shares in a delisted company.
- If the offer fails (insufficient acceptance), the share price could drift back towards pre‑offer levels, especially if no alternative catalyst appears.
- Lack of research coverage
- With no mainstream broker coverage, the stock’s fair value will continue to be set mainly by controlling shareholders, occasional activists, and retail flows rather than institutional checks and balances. [58]
9. Scenario map for investors
Rather than pretend to know the future, it’s more honest to sketch scenarios:
Scenario 1: Offer at S$0.72 succeeds without revision
- The offeror clears the 90% acceptance threshold and proceeds with delisting and, potentially, compulsory acquisition of residual minorities. [59]
- Shareholders lock in a historically high P/B (~0.9x), but below NAV and far below RNAV estimates. [60]
- The public market story ends; any upside from Canberra Crescent or future projects accrues to the Low family in private.
Scenario 2: IFA or market pressure leads to a sweetened offer
- ZICO Capital’s fairness opinion and investor pushback could create pressure for a slightly higher price – for example, closer to reported NAV of S$0.79. [61]
- This would likely be framed as a compromise between RNAV purists and management.
- The probability of a bump is impossible to quantify from public data; it rests on negotiation dynamics, not spreadsheets.
Scenario 3: Offer fails – LKH stays listed
- If acceptances don’t reach 90%, LKH remains a listed company controlled by the same major shareholders.
- The share price may retreat from the S$0.72 anchor, especially as arbitrageurs exit.
- Investors then have to value LKH on:
- Earnings normalisation post‑Klimt,
- The Canberra Crescent & Peak Crescent pipelines,
- Hospitality and rental income, and
- Ongoing dividend policy – which may or may not continue at S$0.015 per share. [62]
In all three scenarios, the key is less “What is the stock worth on Excel today?” and more “Who decides, and under what constraints?”
Right now, the answer is: controlling shareholders, one value investor with a megaphone, and an IFA whose opinion we haven’t seen yet.
10. Bottom line – December 2025 snapshot
As of 8 December 2025, Low Keng Huat (Singapore) Ltd looks like this:
- A cyclical, project‑driven developer that just finished a huge luxury condo profit cycle and has temporarily fallen into loss. [63]
- Owner of a decent set of recurring‑income assets (Paya Lebar Square, Duxton Perth, serviced apartments), plus a new project site at Canberra Crescent. [64]
- A company with NAV of ~S$0.79 and RNAV estimates up to S$1.37, being bid for at S$0.72 by insiders who already control just over half the stock. [65]
- A stock that has more than doubled in a year and now trades near its take‑private price, with no broker coverage and only scattered quantitative forecasts. [66]
For investors, the key questions are not philosophical:
- How much do you care about selling below RNAV in exchange for certainty and liquidity today?
- How comfortable are you with a lumpy earnings profile and a controlling shareholder who prefers to run things away from the public markets?
The mathematics of NAV and RNAV can be debated. The logic of incentives is clearer:
- Management wants a cheaper, more flexible capital structure and full control.
- Some value investors want a higher cut of the embedded property upside.
- The IFA will soon publish a report that could tilt the balance either way.
References
1. www.straitstimes.com, 2. www.theedgesingapore.com, 3. www.theedgesingapore.com, 4. links.sgx.com, 5. links.sgx.com, 6. links.sgx.com, 7. www.lkhs.com.sg, 8. links.sgx.com, 9. links.sgx.com, 10. links.sgx.com, 11. links.sgx.com, 12. links.sgx.com, 13. links.sgx.com, 14. www.marketscreener.com, 15. www.lkhs.com.sg, 16. www.lkhs.com.sg, 17. www.lkhs.com.sg, 18. www.lkhs.com.sg, 19. www.lkhs.com.sg, 20. www.lkhs.com.sg, 21. www.straitstimes.com, 22. www.straitstimes.com, 23. www.straitstimes.com, 24. www.straitstimes.com, 25. www.straitstimes.com, 26. www.straitstimes.com, 27. www.straitstimes.com, 28. www.straitstimes.com, 29. www.stockopedia.com, 30. www.stockopedia.com, 31. www.theedgesingapore.com, 32. www.theedgesingapore.com, 33. links.sgx.com, 34. links.sgx.com, 35. www.businesstimes.com.sg, 36. www.theedgesingapore.com, 37. www.theedgesingapore.com, 38. drwealth.com, 39. drwealth.com, 40. drwealth.com, 41. www.businesstimes.com.sg, 42. sginvestors.io, 43. www.stockopedia.com, 44. walletinvestor.com, 45. simplywall.st, 46. links.sgx.com, 47. www.lkhs.com.sg, 48. www.lkhs.com.sg, 49. links.sgx.com, 50. www.lkhs.com.sg, 51. links.sgx.com, 52. links.sgx.com, 53. drwealth.com, 54. links.sgx.com, 55. www.lkhs.com.sg, 56. links.sgx.com, 57. links.sgx.com, 58. sginvestors.io, 59. www.straitstimes.com, 60. www.businesstimes.com.sg, 61. www.theedgesingapore.com, 62. www.lkhs.com.sg, 63. links.sgx.com, 64. links.sgx.com, 65. www.businesstimes.com.sg, 66. www.stockopedia.com
