SGX lists more than 200 stocks in the Industrials Sector. The 10 largest capitalised Industrials stocks have a combined market cap of more than S$160 billion, and are constituents of the benchmark STI. Among these 10, the five with the highest ROEs are: ST Engineering (22.2%), Venture Corp (16.4%), SATS Ltd (15.1%), Yangzijiang Shipbuilding (13.2%) and ComfortDelGro Corp (11.6%).
SGX’s five largest capitalised Utility plays – Keppel Infrastructure Trust, CITIC Envirotech, China Everbright Water, China Jinjiang Environment and SIIC Environment Holdings – have a combined market capitalisation of more than S$5 billion. In 7M2019, the three largest, best-performing Utility stocks were: China Jinjiang Environment (+30.4%), China Everbright Water (+16.6%) and Keppel Infrastructure Trust (+12.6%).
In the 2019 YTD, SGX’s iEdge S-REIT Index has clocked total returns of 19.7%, compared with total returns of 16.3% and 22.8% for the FTSE EPRA NAREIT Asia ex-Japan REITs Index and the MSCI ACWI REITs Index respectively, in USD terms. In the YTD, the five best-performing constituents of the iEdge S-REIT Index were: RHT Health Trust (+98.2%), Ascendas Hospitality Trust (+38.6%), Ascendas India Trust (+35.3%), Lippo Malls Indonesia Retail Trust (+34.9%) and Mapletree Commercial Trust (+30.1%).
In July, Consumer Staples was the top net buy sector on SGX, drawing total institutional inflows of S$26.9 million. Among the top institutional net buy stocks that month, Wilmar ranked second with inflows of S$27.9 million. The three largest and best-performing Consumer Staples stocks in 7M2019 were: ThaiBev (+40.0%), Wilmar (+30.4%) and Golden Agri (+22.8%).
Singapore’s healthcare sector is typically viewed as defensive, and poised to enjoy multi-year growth prospects. There are 19 healthcare service providers listed on SGX with a combined market capitalisation of more than S$20 billion, and they operate patient care services and facilities both in the city-state and globally. Over the 7M2019 period, the 10 largest healthcare services providers on SGX have averaged a total return of +5.7%. The 3 best performers among them were ISEC Healthcare (+45.2%), HMI (+34.1%) and Singapore O&G (+14.2%)
For the month of July, 23 stocks primary-listed on SGX repurchased more than 30 million shares with a total consideration of S$42 million. This was down from S$55 million in June 2019 and down from S$109 million in July 2018. Buyback consideration was led by OCBC, Keppel REIT and SPH.
Speculation was quelled 30 minutes into session one of the Fed Chair’s two-day semi-annual Monetary Policy testimony on night of July 10. Chairman Powell gave a straight no answer when asked if the July 5 employment report changed outlooks for interest rates. In SG, close to half of the 100 highest turnover stocks saw increased volatility over the relevant four sessions.
SPH REIT will be the first to kick off the latest quarterly reporting season for S-REITs on 11-Jul with the release of its fiscal third quarter results ended 31 May 2019. Keppel REIT will announce its results next Monday, followed by Keppel DC REIT, CapitaLand Commercial Trust, Soilbuild Business Space REIT and First REIT in the same week.
To help S-REITs better compete against private capital and their foreign peers when making asset acquisitions, the MAS has indicated it is considering raising the current leverage limit of 45%. Currently, the 34 S-REITs average a debt-to-asset ratio of about 34%-35%. Based on indicative data extracted from their latest published financial statements and/or annual reports, these REITs may have the capacity to take on additional working capital of approximately S$8.3 billion and S$15.4 billion, if they boosted leverage ratios to 40% and 45% respectively. Among the 34 REITs, Parkway Life REIT has the lowest all-in debt cost.
Among the 11 SGX listed retail REITs, the 5 best performers in the 2019 YTD were: Lippo Malls Indonesia Retail Trust (+37.2%), Mapletree North Asia Commercial Trust (+32.0%), Sasseur REIT (+31.7%), Frasers Centrepoint Trust (+30.3%) and Fortune REIT (+26.2%).
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