Can Sembcorp keep its head above water amid Sembcorp Marine’s weak H1 performance?

It’s counting on its utilities arm to buoy profits.

Sembcorp Industries’ utilities unit will take the center stage going forward, as analysts believe the segment will drive earnings growth and cushion the blow from the marine segment’s sustained weakness.

According to a report by RHB, the company’s utilities segment continues to be its primary growth driver.

“We expect its India thermal power business to do better in 2H16 from a better plant load factor as well as the commencement of two short-term power purchase agreements (PPAs),” RHB noted.

“Commercial operations date (COD) of the 660 megawatt (MW) Unit 3 and Unit 4 will be in 2H16. The company is also actively looking for long-term PPAs,” it added.