Singapore Strategy - Maybank Research 2024-01-05: Time To Cherry Pick; Be Selective In 2024

Singapore Strategy - Time To Cherry Pick; Be Selective In 2024

Singapore Market Strategy - Maybank Research | SGinvestors.ioDBS (SGX:D05)
  • On a P/E basis, the Straits Times Index (STI) is now trading at a 50% discount to the S&P 500 Index (SPX). This is the lowest level in history, even when taking the GFC and COVID in to account. With the US Fed seen pivoting to a dovish stance following its 23 Dec meeting and with the dot plots pointing to interest rate cuts in 2024, we think this gap is not sustainable going forward.

Valuations ultra-cheap, but balance sheets resilient

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  • Importantly, from a quality perspective, the Singapore market offers clear differentiation, in our view. Balance sheets are strong with debt levels falling. Total debt to EBIT has fallen from a 2021 peak of 12.9x to 7.7x in 3Q23. Corporates have conservatively de-geared and repaid loans in a high interest rate environment and conserved cash.
  • Indeed, of all the corporates listed on the SGX, nearly 40% have net cash balance sheets. This provides significant opportunities for M&A and capital return going forward, in our view.

Modest growth with a dash of upside

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Above is the excerpt from report by Maybank Research.
Clients of Maybank Securities may be the first to access the full report in PDF @

Thilan Wickramasinghe Maybank Research | 2024-01-05

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