OU8

$1.57 SGD 1.32B market cap 2026-02-22

Centurion Corporation Limited OU8 BUFFETT / MUNGER / KLARMAN SUMMARY

1 SNAPSHOT

Price$1.57

Market CapSGD 1.32B

EVSGD 2.04B

Net DebtSGD 718M

Shares840.75M

2 BUSINESS

Centurion Corporation is Singapore's largest purpose-built workers accommodation (PBWA) owner and operator, managing 69,929 beds across 37 properties in 6 countries under the Westlite (workers) and dwell (students) brands. Revenue is driven by bed rental income from employers housing foreign construction/marine/process workers in Singapore (77% of revenue) and student accommodation in the UK and Australia (23%). The company recently IPO'd CAREIT, Singapore's first accommodation REIT, as sponsor.

Revenue: SGD 339.7M Organic Growth: 22% (accommodation segment)

3 MOAT WIDE

Regulatory moat: Singapore mandates CMP workers live in approved dormitories, creating captive demand. Supply is constrained by land scarcity and dormitory licensing. New Dormitory Standards (DTS 2030/2040) are tightening supply further as operators retrofit. Scale: Largest operator with 36,436 beds in Singapore across strategic freehold/long-lease sites near industrial areas. 2,079+ corporate customers across diversified industries. Pricing power: 10%+ annual rent increases in 2023-2024 with 99% occupancy in Singapore. REIT platform: CAREIT IPO validates asset values and creates recurring management fee income.

4 MANAGEMENT

CEO: Kong Chee Min (since 2011)

Excellent track record: Reduced D/E from 1.36x to 0.65x in 5 years while growing the portfolio from ~58,000 to ~70,000 beds. Quadrupled dividends from SGD 0.01 to SGD 0.04 in 3 years. Successfully executed CAREIT REIT IPO (16.6x oversubscribed) to unlock value. Insiders own 23% (~SGD 257M), with controlling shareholders actively buying shares.

5 ECONOMICS

71.8% Op Margin

12.2% ROIC

SGD 153.8M (OCF) FCF

3.3x Debt/EBITDA

6 VALUATION

FCF/ShareSGD 0.183

FCF Yield11.7%

DCF RangeSGD 1.50 - SGD 2.20

Post-CAREIT adjusted core earnings ~SGD 90M growing at 10% for 5 years, 5% for years 6-10, 2.5% terminal growth, 9% discount rate. NAV per share SGD 1.37 as at Dec 2024.

7 MUNGER INVERSION -21.3%

Kill Event	Severity	P()	E[Loss]
Singapore construction downturn reduces worker demand	-25%	15%	-3.8%
Dormitory Transition Scheme compliance costs exceed expectations	-15%	40%	-6.0%
CAREIT spin-off dilutes Centurion earnings more than expected	-10%	60%	-6.0%
Malaysia foreign worker cap tightened permanently	-10%	25%	-2.5%
Interest rate spike on SGD 807M debt	-10%	30%	-3.0%

Tail Risk: Simultaneous Singapore construction recession + government decision to build public dormitories could compress margins and occupancy. However, BCA projects SGD 39-53B annual construction demand through 2029 and the government historically relies on private operators. The DTS actually reduces near-term bed supply, supporting pricing.

8 KLARMAN LENS

Downside Case

In the bear case, post-CAREIT Centurion retains fewer prime assets, management fee income is lower than expected, the China BTR expansion absorbs capital with poor returns, and Singapore construction moderates to SGD 30-35B. Core earnings could decline 20-30% to ~SGD 63-70M, implying a share price of SGD 1.00-1.20 at 13-15x core P/E.

Why Market Wrong

The market may be undervaluing Centurion because: (1) the CAREIT spin-off created temporary selling pressure as index/fund rebalancing occurred, (2) the reported P/E of 4.4x includes one-time fair value gains that mask the true ~13x core P/E, confusing screening tools, (3) Singapore small-caps receive minimal international analyst coverage, and (4) the dormitory sector is perceived as unglamorous despite its extraordinary economics.

Why Market Right

Bears would argue: (1) the stock has already 4x'd from 2023 lows and the easy money is made, (2) post-CAREIT the company owns fewer prime assets, (3) China/BTR expansion is a distraction with execution risk, and (4) at 1.15x NAV the margin of safety is thin.

Catalysts

(1) CAREIT dividend distributions to Centurion as 56% unitholder, (2) completion of Westlite Toh Guan redevelopment adding 1,764 beds by end-2025, (3) further bed rate increases in Singapore driven by SGD 47-53B construction pipeline, (4) potential second REIT or asset recycling transaction to unlock remaining Malaysia/development assets.

9 VERDICT WAIT

A- T2 Resilient

Strong Buy$1.1

Buy$1.35

Sell$2.2

Centurion Corporation is an excellent business with a wide regulatory moat, 99% occupancy, and strong growth tailwinds from Singapore's construction boom. However, after a 4x share price increase from 2023 lows, the stock is fairly valued at SGD 1.57 (1.15x NAV, ~13x core earnings). Accumulate on pullbacks below SGD 1.35 for a 3-5% portfolio position. The CAREIT REIT platform and SGD 47-53B construction pipeline provide long-term upside.

🧠 ULTRATHINK Deep Philosophical Analysis

OU8 - Ultrathink Analysis

The Real Question

The real question here is not whether Centurion Corporation is a good business - it demonstrably is, with 99% occupancy, 67% segment margins, and a government-mandated customer base. The real question is: at SGD 1.57, after a 4x re-rating from 2023 lows, is there still enough asymmetry to justify a new position?

This is fundamentally a question about whether the market has finished re-pricing Centurion from "obscure Singapore small-cap dormitory operator" to "high-quality, regulated infrastructure asset with REIT platform optionality." The answer requires thinking about what Centurion becomes over the next decade, not what it was.

Hidden Assumptions

The market is making several assumptions that may be wrong:

Assumption 1: The CAREIT spin-off was value-destructive for Centurion shareholders. The stock dropped 10% post-IPO while CAREIT gained 12%. The market interpreted this as Centurion "losing" its best assets. But the reality is more nuanced: Centurion retained 56% of CAREIT, retains management fees, and freed up capital for higher-return development opportunities. The combined value (Centurion + pro-rata CAREIT units) likely exceeds the pre-spin price. The market is pricing the parts below the whole because it struggles with sum-of-the-parts analysis for Singapore small-caps.

Assumption 2: Core earnings of SGD 110M will flatten post-CAREIT. This assumes Centurion cannot replace the spun-off earnings. But: (a) management fees from CAREIT provide new recurring income, (b) the development pipeline (Toh Guan redevelopment: +1,764 beds; Mandai expansion: +3,696 beds; Johor Tech Park: +870 beds; potential Nusajaya: +7,000 beds) adds significant capacity over 2025-2027, and (c) bed rate increases of 10%+ continue to compound on the retained portfolio.

Assumption 3: The P/E of 4.4x means the stock is cheap. This is the most dangerous assumption. The 4.4x P/E includes SGD 219M of fair value gains that are non-cash and non-recurring. The core P/E is ~13x, which is reasonable but not screamingly cheap for a Singapore real estate company. Value investors who bought at 4.4x P/E without understanding the fair value adjustment will be disappointed.

Assumption 4: Dormitories are commodity real estate. The market treats Centurion like a generic property developer. But this is more like a regulated utility or infrastructure concession. Demand is government-mandated. Supply is government-constrained. Occupancy is near-permanent. The business has more in common with a toll road or water utility than with a condominium developer.

The Contrarian View

For the bears to be right, several things would need to be true simultaneously:

Singapore's construction boom must end. The BCA forecasts SGD 39-53B annually through 2029, driven by public housing (HDB), Changi Terminal 5, Tuas Mega Port, and infrastructure upgrades. For this to collapse, Singapore would need to abandon its development agenda - possible in a severe recession, but Singapore's fiscal position (massive reserves, sovereign wealth funds) makes prolonged austerity unlikely.
The dormitory regulatory moat must erode. This would require the government to either (a) allow workers in non-approved housing (politically impossible after COVID dormitory outbreaks), (b) massively expand public dormitory supply (they have shown no inclination), or (c) reduce foreign worker dependency (the construction industry has no domestic labor alternative).
Centurion's management must destroy value in China. The BTR expansion in Xiamen is small (SGD 10-15M invested) and structured as master leases with limited downside. Even total failure here would be a rounding error on the company's SGD 1.32B market cap.
The 4x share price move must have been purely speculative. But it was not. It was driven by fundamental improvements: revenue doubled from SGD 158M to SGD 340M, core EPS doubled from 5.5 cents to 11.8 cents, and net gearing halved from 50%+ to 29%. The re-rating was warranted.

The bears have a weak hand. The strongest bear argument is simply timing: "the easy money has been made." That is true. But the business continues to compound.

Simplest Thesis

Centurion owns irreplaceable dormitory assets in Singapore where the government mandates that 443,000 workers live in approved beds, supply is shrinking due to retrofit requirements, and SGD 47-53B of annual construction spending ensures demand grows for the next decade.

Why This Opportunity Exists

The mispricing exists for three structural reasons:

1. Singapore small-cap neglect. Centurion has no sell-side coverage from major international brokerages. It is too small for most institutional mandates. The stock trades an average of 1.4M shares/day (~SGD 2.2M) - insufficient liquidity for most funds. This creates a persistent information and attention gap.

2. Sector perception. "Workers dormitories" does not sound like a glamorous investment. The images conjured are of sparse, industrial facilities housing migrant laborers. This creates an emotional barrier for many investors. But the economics are extraordinary: 99% occupancy, 67% margins, regulatory barriers, and pricing power. If this were called "essential workforce housing infrastructure" and listed on the NYSE, it would trade at 25x earnings.

3. Post-REIT complexity. The CAREIT spin-off created a temporarily confusing situation. Investors who held Centurion pre-spin received CAREIT units via dividend-in-specie. The combined value is hard to assess. Index funds rebalanced. Some holders sold to simplify their positions. This created technical selling pressure disconnected from fundamentals.

4. Fair value gain confusion. The reported P/E of 4.4x attracts value screens, but the core P/E of ~13x disappoints screen-buyers who don't read the financials. This creates a revolving door of uninformed traders, adding volatility without changing the underlying value.

The question is whether the mispricing will persist or correct. I believe it will partially correct as: (a) CAREIT's success attracts attention to the sponsor, (b) continued earnings growth compresses the core P/E, and (c) rising dividends attract income-focused investors. But full correction may take 2-3 years, which is fine for a patient investor.

What Would Change My Mind

I would abandon this thesis if any of the following occurred:

Singapore PBWA occupancy falls below 90%. This would signal a structural demand shift, not a cyclical dip. Current: 99%.
Core EPS declines for two consecutive years. The growth story depends on continued earnings momentum. A one-year dip from CAREIT restructuring is expected; a sustained decline is not.
Net gearing rises above 50%. Centurion has been deleveraging beautifully. A return to aggressive borrowing for low-quality acquisitions (especially in China) would signal capital allocation discipline has broken.
BCA construction demand forecast falls below SGD 30B. This would represent a genuine structural decline in Singapore's construction sector and directly reduce dormitory demand.
Management sells significant stakes. With 23% insider ownership, management has strong skin in the game. Net insider selling would be a serious warning.

None of these are currently showing any signs of occurring.

The Soul of This Business

Strip away the financial analysis, and what you find at the core of Centurion is something remarkably simple: this is a company that provides a basic human need (shelter) to a captive population (legally mandated foreign workers) in a land-scarce city-state (Singapore) where both demand and supply are controlled by the government.

The soul of this business is inevitability. Workers will come because Singapore needs to build. They will need beds because the law requires it. Centurion will fill those beds because it controls the largest supply in the market. Rates will rise because demand exceeds supply.

This is not a business that requires brilliant management (though it has competent management). It does not require technological innovation. It does not require brand marketing or customer acquisition spend. It simply requires owning the right assets in the right location under the right regulatory framework - and then not screwing it up.

The fragility, if it exists, is political. A future Singapore government could decide to nationalize dormitory provision, or radically increase public supply, or reduce foreign worker dependency. But Singapore's governance model - pragmatic, pro-business, technocratic - has been remarkably consistent for 60 years. Betting against its continuity is a low-probability wager.

Centurion is not a moonshot. It is not a compounder that will 10x from here. It is a high-quality, regulated infrastructure asset that should deliver 10-15% annual returns (earnings growth + dividends) for the next decade with very low risk of permanent capital loss. For a patient investor who accumulates during periodic pullbacks, this is the kind of boring, inevitable business that quietly builds wealth while the market chases the next AI or crypto story.

The 4x move from 2023 was the market waking up. The next move will be slower, steadier, and driven by fundamentals rather than re-rating. That is fine. Boring and inevitable is exactly what a long-term portfolio needs.

Executive Summary

3-Sentence Thesis

Centurion Corporation is Singapore's largest purpose-built workers accommodation (PBWA) operator, controlling ~36,400 beds in a market with structurally constrained supply and growing demand driven by Singapore's SGD 47-53B construction pipeline. The company trades at 0.65x book value and ~13x core earnings despite delivering 26% revenue CAGR since 2011, 99% Singapore occupancy, and a recently completed REIT IPO (CAREIT) that validates asset values and creates a recurring fee income platform. The key risk is post-REIT spin-off portfolio shrinkage and regulatory compliance costs from Singapore's Dormitory Transition Scheme (DTS), but the demand-supply dynamics remain overwhelmingly favorable for the next 5-10 years.

Key Metrics Dashboard

Metric	Value	Assessment
Price / NAV	1.15x	Fair (post revaluation)
P/E (Core)	~13.3x	Reasonable for asset-backed compounder
P/E (Total)	4.4x	Misleading (includes FV gains)
ROE	36.3% (reported) / ~15% (core)	Strong
ROIC	12.2%	Good, improving trend
Debt/EBITDA	3.26x	Comfortable for real estate
Net Gearing	29%	Conservative
OCF	SGD 153.8M	Strong and growing
FCF Yield	~15.6%	Excellent
Dividend Yield	2.55%	Growing rapidly
SG Occupancy	99%	Near-full
Revenue CAGR (5yr)	20.6%	Outstanding
Core EPS CAGR (5yr)	16.4%	Strong
Beta	0.26	Very low volatility

Verdict: WAIT - Accumulate below SGD 1.35 (Strong Buy below SGD 1.10)

Phase 0: Business Understanding

What Does Centurion Do?

Centurion Corporation owns, develops, and manages purpose-built accommodation assets in two primary segments:

1. Purpose-Built Workers Accommodation (PBWA) - 77% of revenue

Brand: Westlite
Singapore: 10 assets (~36,436 beds), including 6 Purpose-Built Dormitories and 4 Quick-Build Dormitories
Malaysia: 8 assets (~28,053 beds) in Johor, Penang, and Selangor
Hong Kong SAR: 1 asset (~539 beds), opened Nov 2024
Customers: 2,079+ companies across construction (54%), oil & gas (21%), manufacturing (11%), marine (6%), and other sectors
Singapore occupancy: 99% (FY2024)

2. Purpose-Built Student Accommodation (PBSA) - 23% of revenue

Brand: dwell (and new premium brand Epiisod)
UK: 10 assets (~2,786 beds) in Manchester, Nottingham, Liverpool, Newcastle, Bristol
Australia: 2 assets (~897 beds) in Melbourne and Adelaide
US: 3 assets (~663 beds) managed through Centurion US Student Housing Fund
Hong Kong SAR: 2 assets (~155 beds)
UK occupancy: 98% (FY2024)

3. Build-to-Rent (BTR) - New segment

2 projects in Xiamen, China (~1,500 apartments)
Targeting fresh graduates and working professionals

Revenue Model: Centurion earns rental income from bed/room leases to employers (PBWA) or students/universities (PBSA). Revenue is highly recurring with multi-year lease agreements. The company also manages assets for third-party investors, earning management fees.

Total Portfolio: 37 operational properties, ~69,929 beds, SGD 2.5B assets under management across 6 countries.

How the Industry Works

Singapore mandates that foreign construction, marine, and process (CMP) workers live in approved Purpose-Built Dormitories (PBDs). This is a regulated market where:

Demand is government-driven: Singapore's construction pipeline (SGD 39-53B annually through 2029) requires ~443,000 CMP work permit holders
Supply is government-constrained: New dormitory licenses are limited; existing dorms must retrofit to New Dormitory Standards (NDS) by 2040
Post-COVID regulation tightened supply: De-densification requirements reduced effective bed capacity
Barriers to entry are extremely high: Land scarcity, regulatory approvals, 30+ year concession periods, significant capital requirements
Pricing power is strong: 10%+ annual bed rate increases in 2023-2024 as demand outstrips supply

This creates a near-oligopoly with extraordinary pricing power for incumbent operators like Centurion.

Phase 1: Risk Analysis (Inversion - "How could this go wrong?")

Risk Register

#	Risk Event	P(Event)	Impact	Expected Loss	Mitigation
1	Singapore construction downturn reduces worker demand	15%	-25%	-3.8%	BCA forecasts SGD 39-53B through 2029; multi-sector diversification
2	Regulatory change (new dormitory standards) increases compliance costs	40%	-15%	-6.0%	QBDs already compliant; redevelopment adds capacity; costs spread over decades
3	Malaysia political risk / foreign worker cap tightened	25%	-10%	-2.5%	Only 10% of revenue from Malaysia; growing pressure to raise worker caps
4	CAREIT REIT spin-off dilutes Centurion's earnings	60%	-10%	-6.0%	Offset by management fees + retained properties + REIT unit distributions
5	Interest rate risk on SGD 807M debt	30%	-10%	-3.0%	Average 6-year debt maturity; rates trending down; 4.4x interest coverage
6	China BTR/PBSA expansion fails	30%	-5%	-1.5%	Small allocation; master lease model limits downside
7	UK student visa policy tightens further	20%	-8%	-1.6%	UK assets now in CAREIT; visas already showing recovery (+15% YoY Dec 2024)
8	Key man risk (management team)	10%	-15%	-1.5%	Deep bench; CEO since 2011; COO 17+ years tenure
9	Singapore government builds competing dormitories	10%	-20%	-2.0%	Government prefers private operators; public housing pipeline is limited
10	Currency risk (SGD vs MYR, GBP, AUD)	40%	-3%	-1.2%	Predominantly SGD revenue (90% of PBWA)

Total Expected Downside: -29.1%

Tail Risk Assessment

The most severe scenario would be a simultaneous Singapore construction recession + aggressive government intervention in dormitory supply. However, this is unlikely because: (1) Singapore has committed SGD 39-53B annually in construction through 2029, (2) the government relies on private operators to house workers, and (3) the Dormitory Transition Scheme actually reduces near-term supply as beds are taken offline for retrofitting.

Phase 2: Financial Analysis

Revenue Growth Analysis

Period	Revenue (SGD M)	Growth
FY2020	133.2	-
FY2021	158.1	+18.7%
FY2022	189.4	+19.8%
FY2023	234.6	+23.9%
FY2024	339.7	+44.8%
5yr CAGR		20.6%
Accommodation Rev (2011-2024 CAGR)		26%

Revenue growth is driven by three factors: (1) increasing bed rates (10%+ per annum recently), (2) new bed additions (~2,552 beds added in FY2024), and (3) improved occupancy.

Profitability Analysis

Core Business Profitability (excluding fair value gains):

Metric	FY2024	FY2023	FY2022	FY2021	FY2020
Core Net Profit (SGD M)	110.8	76.3	~52	~38	~20
Core EPS (cents)	11.81	8.23	6.79	6.04	5.53
Gross Margin	77%	72%	-	-	-
PBWA Segment Margin	67%	63%	-	-	-
PBSA Segment Margin	50%	43%	-	-	-

This is a remarkably high-margin business. Workers accommodation in Singapore runs at 67-68% segment margins with 99% occupancy - this is effectively a toll-road business with captive customers (employers are legally required to house workers in approved dorms).

DuPont ROE Decomposition (FY2024)

Component	Value
Net Profit Margin (Core)	43.7% (110.8/253.6)
Asset Turnover	0.155x (339.7/2,194.7)
Financial Leverage	1.78x (2,194.7/1,235.1)
ROE (Reported)	36.3%
ROE (Core, estimated)	~12%

The reported ROE is inflated by fair value gains. Core ROE of ~12% is respectable for a capital-intensive real estate business and is trending upward.

Owner Earnings Calculation (FY2024)

Component	SGD M
Operating Cash Flow	153.8
Less: Maintenance CapEx (est. 2% of investment properties)	(37.0)
Owner Earnings	116.8
Per Share	SGD 0.139
Owner Earnings Yield	8.9%

ROIC vs WACC

Metric	Value
ROIC	12.16%
Estimated WACC (8-9% for SGX real estate)	~8.5%
ROIC - WACC Spread	+3.7%

Centurion is creating value - its returns exceed its cost of capital, and the spread is widening as the business scales.

DCF Valuation

Assumptions:

Base core earnings: SGD 110.8M (FY2024)
Growth Rate (Years 1-5): 10% (bed additions + rate increases)
Growth Rate (Years 6-10): 5% (maturation)
Terminal Growth: 2.5%
Discount Rate: 9% (Singapore small-cap with real estate risk)
Post-CAREIT adjustment: Assume 30% of core earnings transferred to REIT, offset by ~20% management fee income

Post-CAREIT Adjusted Core Earnings: SGD ~90M

Year	Cash Flow (SGD M)	PV (SGD M)
1-5 (10% growth)	90 -> 145	461
6-10 (5% growth)	152 -> 194	411
Terminal Value	3,325	1,404
Total Enterprise Value		2,276
Less: Net Debt		(718)
Equity Value		1,558
Per Share (840.75M shares)		SGD 1.85

DCF Range: SGD 1.50 - SGD 2.20 (sensitivity to discount rate 8-10% and growth 8-12%)

Asset-Based Valuation (NAV Approach)

Component	Value
NAV Per Share (as reported, Dec 2024)	SGD 1.37
Current Price	SGD 1.57
Price/NAV	1.15x

Note: The NAV already incorporates the SGD 219M fair value gain in FY2024. At 1.15x NAV, the stock is priced slightly above book but well below replacement cost of its assets.

Replacement Cost Analysis: Building a new 1,000-bed dormitory in Singapore costs approximately SGD 50-80M (including land). Centurion's 36,436 Singapore beds alone would cost SGD 1.8-2.9B to replicate, versus a total market cap of SGD 1.32B.

Phase 3: Moat Analysis

Moat Sources

1. Regulatory Moat (PRIMARY - WIDE)

Singapore mandates that CMP workers live in approved dormitories
New dormitory licenses are extremely difficult to obtain (land scarcity, regulatory hurdles)
The Dormitory Transition Scheme (DTS) requires existing dorms to retrofit by 2030/2040, temporarily reducing supply
Centurion's QBDs already meet New Dormitory Standards; competitors face costly upgrades
Measurement: Market share of ~15% of Singapore's 244,000 PBWA beds

2. Scale Advantages (WIDE)

Largest PBWA provider in Singapore with 36,436 beds
Portfolio diversification across 37 properties reduces single-asset risk
Operational efficiency from managing 2,079+ corporate clients
Ability to negotiate bulk procurement for dormitory services
Measurement: Revenue per bed increasing annually (SGD ~5,400/bed in FY2024 for Singapore)

3. Switching Costs (NARROW)

Employers sign multi-year contracts; switching dormitories is disruptive
Workers prefer established facilities with amenities (Westlite Resi-life program)
Companies value compliance track record with MOM regulations
Measurement: 99% occupancy + 10%+ rent increases = strong pricing power

4. Location/Land Moat (WIDE)

Freehold and long-leasehold land in strategic locations near industrial areas
Westlite Mandai: Freehold, 6,300 beds near Sungai Kadut/Woodlands
ASPRI-Westlite Papan: 30-year lease, 7,900 beds near Jurong Island
Westlite Toh Guan: 60-year lease, near established industrial areas
No competing sites available in these locations

5. Asset Management Platform (EMERGING)

CAREIT IPO validates Centurion as a REIT sponsor/manager
Management fees provide recurring income with no capital at risk
Platform can be used to manage third-party capital (US Student Housing Fund model)
Measurement: SGD 2.5B AUM, growing

Overall Moat Assessment: WIDE

The combination of regulatory barriers, scale, location advantages, and a captive customer base creates a durable moat. This is one of the rare businesses where demand is literally mandated by law (workers MUST live in approved dorms), supply is severely constrained (no new land), and pricing power is strong (10%+ annual increases). The moat is widening as new regulations further restrict supply while construction demand grows.

Durability Test: What could erode this moat?

Government builds public dormitories (unlikely - they prefer private operators)
Construction workers replaced by automation (long-term risk, decades away)
Regulatory change allowing non-PBD housing (would require political will to lower standards)
Timeline: 15+ years of moat durability

Phase 4: Decision Synthesis

Management Assessment

CEO Kong Chee Min (since 2011):

Accountant by training (NUS), joined company in 1996, appointed CEO when company pivoted to accommodation in 2011
Successfully transformed Centurion from a construction materials company to Singapore's largest PBWA operator
Revenue grew from ~SGD 5M (pre-2011) to SGD 340M (2024) under his leadership
14+ year CEO tenure demonstrates commitment

Joint Chairman Loh Kim Kang David (since 2015):

Controlling shareholder; 20+ years investment experience
Insider ownership: ~~23% total insider ownership (~~SGD 257M at current prices)
Han Seng Juan (maternal cousin of Loh): 4.13% stake, actively buying

Capital Allocation:

Excellent: Deleveraging (D/E from 1.36x to 0.65x in 5 years), growing dividends, asset recycling, and REIT IPO all demonstrate shareholder-friendly capital allocation
Dividends quadrupled from SGD 0.01 to SGD 0.04 per share in 3 years
Net debt reduced while growing portfolio

Position Sizing

Scenario	Probability	3-Year Return	Weighted
Bull (SGD 2.20)	25%	+40%	+10.0%
Base (SGD 1.85)	50%	+18%	+9.0%
Bear (SGD 1.20)	25%	-24%	-5.9%
Expected Return			+13.1%
+ Dividends (~3%/yr)		+9%	+9.0%
Total Expected Return			+22.1%

Monitoring Metrics & Action Thresholds

Metric	Current	Green	Yellow	Red
SG PBWA Occupancy	99%	>95%	90-95%	<90%
Core EPS Growth	+43%	>10%	0-10%	Negative
Net Gearing	29%	<40%	40-50%	>50%
Dividend Growth	+33%	>10%	0%	Cut
Bed Capacity Growth	+3.7%	>3%	0-3%	Declining

CAREIT Impact Assessment

The CAREIT REIT IPO in September 2025 is transformative:

What was spun off: 14 assets valued at SGD 1.84B (5 PBWA in Singapore + 8 PBSA in UK + 1 PBSA in Australia)
What Centurion retains: Sponsor role, management fees, ~56% ownership in CAREIT, remaining properties (Malaysia PBWA, HK, China, some Singapore QBDs, development pipeline)
IPO price: SGD 0.88/unit, debut at SGD 0.96 (+9.1%)
Impact on Centurion: Short-term share price dip (~10%), but long-term positive as it unlocks value, creates fee income, and provides capital for growth

The post-CAREIT Centurion will be a hybrid REIT sponsor + accommodation developer/operator. The management fee income is high-margin and capital-light, while the retained development pipeline offers growth optionality.

Final Decision

Recommendation: WAIT - Accumulate below SGD 1.35

Rationale:

Centurion is an excellent business with a wide moat in a structurally attractive market
At SGD 1.57, the stock has already re-rated significantly from SGD 0.40 (2023) - a 4x move
The CAREIT spin-off has temporarily depressed the share price but the combined value (Centurion + CAREIT units) exceeds the pre-spin price
At current prices, the stock offers ~13% expected annual return (capital gains + dividends) - acceptable but not screaming cheap
A pullback to SGD 1.35 (12x core earnings, ~1.0x NAV) would offer a more compelling entry

Strong Buy Price: SGD 1.10 (corresponding to ~9x core earnings, ~0.80x NAV) Accumulate Price: SGD 1.35 (corresponding to ~11.5x core earnings, ~1.0x NAV) Sell Price: SGD 2.20 (corresponding to ~19x core earnings, ~1.6x NAV)

Target Allocation: 3-5% of portfolio (when at accumulation price)

Appendix: Key Data Sources

Centurion Corporation Annual Reports 2020-2024 (SGX filings)
FY2024 Results Presentation (27 Feb 2025)
FY2023 Results Presentation
1H FY2024 Interim Results
StockAnalysis.com financial data
SGX corporate announcements
Knight Frank Singapore - H1 2025 Worker Dormitory Report
BCA Singapore construction demand forecasts
CBRE UK student housing reports