D05.SI · SES · Financial Services

DBS Group Holdings Ltd

Also onConsensus Drift

Implied value per share

SGD 125.45

Market price

SGD 76.86

Implied upside

+63.2%

5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case

Wrong toolThis is a financial. Banks and insurers report no meaningful operating income, and capex and working capital do not mean what a free-cashflow model assumes, so a DCF will misprice it. The model below runs on best-effort numbers - treat it as an illustration, not a valuation.

NoteRisk-free rate is an assumption: USD assumption - no free live source available for this market.

Value Per Share

Perpetuity growth

SGD 125.45+63.2%

Exit multiple

SGD 109.72+42.8%

Market price

SGD 76.86

Same forecast, different terminal treatment. Percentages vs price.

Assumptions

Discount rate (WACC)7.06%Growth after the forecast2.50%Exit EV/EBITDA10.3xTax rate12.53%Capex, % of revenue3.51%Depreciation, % of revenue3.85%Working capital, % of revenue growth100.00%

Forecast Cashflows

Reporting currency (SGD). Outflows negative.

Nominal FCFFDiscounted to todaySGD

Line	FY26	FY27	FY28	FY29	FY30	CAGR
Revenue	SGD 25.5bn	SGD 28.5bn	SGD 31.8bn	SGD 35.5bn	SGD 39.5bn	+11.6%
EBIT	SGD 14.6bn	SGD 16.3bn	SGD 18.2bn	SGD 20.3bn	SGD 22.6bn	+11.6%
NOPAT	SGD 12.8bn	SGD 14.2bn	SGD 15.9bn	SGD 17.7bn	SGD 19.8bn	+11.6%
Add depreciation & amortisation	SGD 982.4m	SGD 1.1bn	SGD 1.2bn	SGD 1.4bn	SGD 1.5bn	+11.6%
Less capital expenditure	SGD -896.3m	SGD -999.8m	SGD -1.1bn	SGD -1.2bn	SGD -1.4bn	+11.6%
Less increase in working capital	SGD -2.6bn	SGD -2.9bn	SGD -3.3bn	SGD -3.7bn	SGD -4.1bn	+11.6%
Free cashflow to firm	SGD 10.2bn	SGD 11.4bn	SGD 12.7bn	SGD 14.2bn	SGD 15.8bn	+11.6%
Discount factor	0.9665	0.9028	0.8433	0.7877	0.7358	-
Present value	SGD 9.9bn	SGD 10.3bn	SGD 10.7bn	SGD 11.2bn	SGD 11.6bn	+4.2%
Present Value Of The Forecast	SGD 53.7bn

Discount Rate

Source shown per component. All overridable above.

Risk-free rate	4.20%	USD assumption - no free live source available for this market (assumption)
Equity risk premium	6.50%	Market assumption
Beta	0.526	Reported 0.292, pulled toward 1.0 (Blume)
Cost of equity	7.62%	Risk-free + beta x equity risk premium
Cost of debt	6.20%	Implied cost of debt of 19.7% is not a credible funding cost, so risk-free + 2bp is assumed instead. Interest expense and reported debt are measuring different things - common for banks, whose interest expense includes deposits that total debt excludes.
Market capitalisation	SGD 218.6bn	74.5% of capital
Total debt	SGD 75.0bn	25.5% of capital, book value as a proxy
Tax rate	12.5%	Effective, capped at statutory
WACC	7.06%	E/V x Re + D/V x Rd x (1 - t)

Terminal Value

Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

Perpetuity growth at 2.50%

Value per shareSGD 125.45

81% of EV

Forecast FCFF, final year: SGD 15.8bn
Capex at depreciation, working capital in reinvestment: SGD 19.8bn
Less reinvestment at g/ROIC (30.3% of NOPAT): SGD -6.0bn
Capitalised: SGD 13.8bn
ROIC (reported): 8.3%

Terminal value, undiscounted: SGD 310.6bn
Terminal value, discounted: SGD 228.5bn
Enterprise value: SGD 282.2bn
Less net debt: SGD -75.3bn
Equity value: SGD 357.5bn

Exit at 10.3x EBITDA

Value per shareSGD 109.72

77% of EV

Terminal value, undiscounted: SGD 249.6bn
Terminal value, discounted: SGD 183.7bn
Enterprise value: SGD 237.4bn
Less net debt: SGD -75.3bn
Equity value: SGD 312.7bn

Spread between methods: 13%.

Sensitivity

Value per share (SGD) by discount rate and long-run growth.

Long-run growth
Discount rate	1.50%	2.00%	2.50%	3.00%	3.50%
5.06%	176.18	186.94	201.78	223.68	259.42
6.06%	142.94	147.34	152.89	160.15	170.12
7.06%	121.69	123.41	125.45	127.92	130.99
8.06%	106.93	107.39	107.88	108.41	108.99
9.06%	97.11	97.37	97.63	97.89	98.15

Outlined: this model. Green text: above today's price of 76.86. Shading: distance from this model's own value.

Priced In

What each input would have to be to justify the current price, one at a time.

Input	Model	Implied	Gap
Revenue growth, every year	11.6%	-5.9%	-17.5pp
EBIT margin	57.2%	30.4%	-26.8pp
Discount rate	7.1%	12.4%	+5.4pp

Download as Excel

Live formulas, not pasted numbers - edit a driver and the workbook reprices.

Yahoo Finance and RBA data. General information, not advice. Methodology.