SINGAPORE | CONGLOMERATE | FY25 RESULTS
- 2H25/FY25 PATMI surged 242%/493% YoY to S$61.6mn/S$170.9mn, exceeding our expectations and reaching 53%/146% of our FY25e forecast. The performance includes fair value gains from the IPOs of GemLife and The Beauty Tech Group (TBTG) (S$128.5mn). Excluding FV gains, FY25 core profits (excluding TBTG and Skylark Drones) jumped 36% YoY to S$14.8mn.
- The Group has entered into agreements to acquire an additional 81.64% stake in the 21-acre mixed-use, healthcare-led development site in Gurugram for S$93.9mn, increasing its total stake to 95.28%, subject to shareholders’ approval. Its original 13.64% stake recorded a fair value gain of S$9.2mn (+140%) in FY25.
- We maintain BUY with a higher SOTP-derived TP of S$2.56 (prev. S$2.12) at a 50% conglomerate discount. We edge up our FY26e PATMI estimate by 1% on stronger profitability in the lifestyle segment. The lifestyle businesses continue to scale, with a minimum 25% growth expected in FY26e, and the Nespresso India business to turn profitable in FY27. We updated our SOTP to reflect the current market values of the GemLife and TBTG listed stakes and raised our valuation for the lifestyle business to 12x FY26e PE (from 8x) on stronger growth prospects. The Gurugram real estate investment has significant potential to drive NAV upside in the coming years. A second interim dividend of 3.5 cents was declared, bringing total FY25 dividends to 6.5 cents per share, translating to a dividend yield of 3.5% for FY25.
The Positives
+ Lifestyle segment continues strong growth momentum. Revenue from the Lifestyle segment rose 29% YoY to S$352mn in FY25, underpinned by robust demand for the Group’s beauty and fragrance products in Greater China, as well as DJI’s range of drones, accessories, and audiovisual products in South Asia. Lifestyle segment profit reached S$44.3mn in FY25, up 140% YoY, driven by the gain from the IPO of TBTG. Excluding TBTG and Skylark Drones, the core Lifestyle business recorded a 36% YoY increase in profit to S$14.8mn in FY25.
+ Significant fair value gains from investees’ IPO. GemLife and TBTG successfully completed their IPOs on the Australian Securities Exchange and the London Stock Exchange, respectively, resulting in TCL reporting an after-deferred-tax net fair value gain of S$128.5mn.
The Negative
– nil
Outlook
- Beauty and fragrance: Following the addition of Miu Miu Fragrances in 4Q25, the Group now manages over 65 retail stores and counters in Greater China. It continues to broaden its brand portfolio and expand both offline and online channels to capture rising demand in the region’s beauty market.
- DJI: DJI’s expanded range of drones, accessories, and audio-visual products continues to gain strong traction in South Asia. To capture this momentum, the Group plans to establish 20–30 new DJI stores across India and other South Asian markets over the next two to three years, including flagship stores in major cities from 1H26.
- Bharat Skytech: Capitalising on the Indian Government’s “Make in India” initiative, Bharat Skytech, an Indian drone component manufacturer and supplier, will begin in-house manufacturing of components for agriculture drones, with manufacturing starting in May 2026 and a commercial launch in 2Q26.
- Skylark Drones (23% stake): The Group is exploring joint venture opportunities to manufacture enterprise-grade and specialised drones in India.
- Nespresso: As the official distributor of Nespresso in India, the Group continues to scale the brand’s presence with the opening of its second boutique at Ambience Mall, Gurugram, in March 2026. Further boutiques and pop-up stores are planned in Bengaluru and Mumbai later this year to strengthen brand visibility and drive revenue growth. The Nespresso business is expected to achieve profitability in 2027 as it continues to scale through boutiques, online platforms, and B2B sales.
- Japan property investments: The Group’s Japanese investment properties remain resilient, with average occupancy of 99% across its five commercial buildings in Osaka. The Group is also now entitled to a 30% revenue share from the Best Western Hotel, with profit sharing commencing after revenue exceeded minimum thresholds, which should contribute positively to earnings and valuations. These assets provide stable recurring income, while offering potential for opportunistic divestment.
- Real estate project in Gurugram, India: The Group has entered into agreements to acquire an additional 81.64% stake in a 21-acre mixed-use healthcare-led development site in Gurugram for S$93.9mn, increasing its equity stake to 95.28%, subject to shareholders’ approval at an upcoming EGM. The acquisition will be funded through cash and the issuance of new shares. Its existing 13.64% stake recorded a fair value uplift of S$9.2mn (+140%) in FY25. The project will comprise a hospital, health and wellness centre, and residential components. The Group is in advanced discussions with a Tier-1 hospital operator to construct and operate the hospital, with the Group entitled to a revenue share. It is also in discussions with residential development partners to design and construct the residential component, with the Group entitled to a share of residential unit sales. The Health and Wellness Centre will be developed by the Group. Overall, the project has the potential to become a significant contributor to Thakral over the longer term.
Maintain BUY with a higher SOTP-derived TP of S$2.56 (prev. S$2.12).
Important Information
This report is prepared and/or distributed by Phillip Securities Research Pte Ltd (“Phillip Securities Research”), which is a holder of a financial adviser’s license under the Financial Advisers Act, Chapter 110 in Singapore.
By receiving or reading this report, you agree to be bound by the terms and limitations set out below. Any failure to comply with these terms and limitations may constitute a violation of law. This report has been provided to you for personal use only and shall not be reproduced, distributed or published by you in whole or in part, for any purpose. If you have received this report by mistake, please delete or destroy it, and notify the sender immediately.
The information and any analysis, forecasts, projections, expectations and opinions (collectively, the “Research”) contained in this report has been obtained from public sources which Phillip Securities Research believes to be reliable. However, Phillip Securities Research does not make any representation or warranty, express or implied that such information or Research is accurate, complete or appropriate or should be relied upon as such. Any such information or Research contained in this report is subject to change, and Phillip Securities Research shall not have any responsibility to maintain or update the information or Research made available or to supply any corrections, updates or releases in connection therewith.
Any opinions, forecasts, assumptions, estimates, valuations and prices contained in this report are as of the date indicated and are subject to change at any time without prior notice. Past performance of any product referred to in this report is not indicative of future results.
This report does not constitute, and should not be used as a substitute for, tax, legal or investment advice. This report should not be relied upon exclusively or as authoritative, without further being subject to the recipient’s own independent verification and exercise of judgment. The fact that this report has been made available constitutes neither a recommendation to enter into a particular transaction, nor a representation that any product described in this report is suitable or appropriate for the recipient. Recipients should be aware that many of the products, which may be described in this report involve significant risks and may not be suitable for all investors, and that any decision to enter into transactions involving such products should not be made, unless all such risks are understood and an independent determination has been made that such transactions would be appropriate. Any discussion of the risks contained herein with respect to any product should not be considered to be a disclosure of all risks or a complete discussion of such risks.
Nothing in this report shall be construed to be an offer or solicitation for the purchase or sale of any product. Any decision to purchase any product mentioned in this report should take into account existing public information, including any registered prospectus in respect of such product.
Phillip Securities Research, or persons associated with or connected to Phillip Securities Research, including but not limited to its officers, directors, employees or persons involved in the issuance of this report, may provide an array of financial services to a large number of corporations in Singapore and worldwide, including but not limited to commercial / investment banking activities (including sponsorship, financial advisory or underwriting activities), brokerage or securities trading activities. Phillip Securities Research, or persons associated with or connected to Phillip Securities Research, including but not limited to its officers, directors, employees or persons involved in the issuance of this report, may have participated in or invested in transactions with the issuer(s) of the securities mentioned in this report, and may have performed services for or solicited business from such issuers. Additionally, Phillip Securities Research, or persons associated with or connected to Phillip Securities Research, including but not limited to its officers, directors, employees or persons involved in the issuance of this report, may have provided advice or investment services to such companies and investments or related investments, as may be mentioned in this report.
Phillip Securities Research or persons associated with or connected to Phillip Securities Research, including but not limited to its officers, directors, employees or persons involved in the issuance of this report may, from time to time maintain a long or short position in securities referred to herein, or in related futures or options, purchase or sell, make a market in, or engage in any other transaction involving such securities, and earn brokerage or other compensation in respect of the foregoing. Investments will be denominated in various currencies including US dollars and Euro and thus will be subject to any fluctuation in exchange rates between US dollars and Euro or foreign currencies and the currency of your own jurisdiction. Such fluctuations may have an adverse effect on the value, price or income return of the investment.
To the extent permitted by law, Phillip Securities Research, or persons associated with or connected to Phillip Securities Research, including but not limited to its officers, directors, employees or persons involved in the issuance of this report, may at any time engage in any of the above activities as set out above or otherwise hold an interest, whether material or not, in respect of companies and investments or related investments, which may be mentioned in this report. Accordingly, information may be available to Phillip Securities Research, or persons associated with or connected to Phillip Securities Research, including but not limited to its officers, directors, employees or persons involved in the issuance of this report, which is not reflected in this report, and Phillip Securities Research, or persons associated with or connected to Phillip Securities Research, including but not limited to its officers, directors, employees or persons involved in the issuance of this report, may, to the extent permitted by law, have acted upon or used the information prior to or immediately following its publication. Phillip Securities Research, or persons associated with or connected to Phillip Securities Research, including but not limited its officers, directors, employees or persons involved in the issuance of this report, may have issued other material that is inconsistent with, or reach different conclusions from, the contents of this report.
The information, tools and material presented herein are not directed, intended for distribution to or use by, any person or entity in any jurisdiction or country where such distribution, publication, availability or use would be contrary to the applicable law or regulation or which would subject Phillip Securities Research to any registration or licensing or other requirement, or penalty for contravention of such requirements within such jurisdiction.
This report is intended for general circulation only and does not take into account the specific investment objectives, financial situation or particular needs of any particular person. The products mentioned in this report may not be suitable for all investors and a person receiving or reading this report should seek advice from a professional and financial adviser regarding the legal, business, financial, tax and other aspects including the suitability of such products, taking into account the specific investment objectives, financial situation or particular needs of that person, before making a commitment to invest in any of such products.
This report is not intended for distribution, publication to or use by any person in any jurisdiction outside of Singapore or any other jurisdiction as Phillip Securities Research may determine in its absolute discretion.
IMPORTANT DISCLOSURES FOR INCLUDED RESEARCH ANALYSES OR REPORTS OF FOREIGN RESEARCH HOUSES
Where the report contains research analyses or reports from a foreign research house, please note:
- recipients of the analyses or reports are to contact Phillip Securities Research (and not the relevant foreign research house) in Singapore at 250 North Bridge Road, #06-00 Raffles City Tower, Singapore 179101, telephone number +65 6533 6001, in respect of any matters arising from, or in connection with, the analyses or reports; and
- to the extent that the analyses or reports are delivered to and intended to be received by any person in Singapore who is not an accredited investor, expert investor or institutional investor, Phillip Securities Research accepts legal responsibility for the contents of the analyses or reports.
