SGX Market Updates

5 SGX Best-Performing China-Based Plays Avg 41% Total Return in Jan-Feb 2019


PUBLISHED ON |

06 March 2019

  • SGX lists more than 700 companies with a combined market cap of nearly US$670 billion. Overseas listings comprise more than 45% of this total market cap.

  • There are more than 130 companies on SGX that are either headquartered or have their principal place of business in Hong Kong and/or Mainland China, with a combined market cap of over S$200 billion. Among them, pure China-based plays account for just under 100.

  • Among the pure China-based plays, the five best performers in Jan-Feb 2019 were: Sunpower (+80.0%), China Jinjiang Environment (+38.0%), SIIC Environment (+36.4%), China Aviation Oil (+29.2%), and CITIC Envirotech (+19.7%). They have averaged a total return of +40.7% over the Jan-Feb period, bringing their 1Y and 3Y total returns to -11.1% and +30.2% respectively.




Singapore Exchange lists more than 700 companies with a combined market capitalisation of nearly US$670 billion. Overseas listings comprise more than 45% of this total market capitalisation. In comparison, the proportion of foreign companies listed on other exchanges ranges from over 1% for Stock Exchange of Hong Kong, 5% for the Nasdaq, more than 20% for London Stock Exchange and zero for Tokyo Stock Exchange.

Currently, there are more than 130 companies listed on SGX that are either headquartered or have their principal place of business in Hong Kong and/or Mainland China, and they have a combined market capitalisation of over S$200 billion.


Foreign vs Domestic Listings on SGX


In terms of pure China-based plays, there are just under 100 listings on SGX. Among these, the 10 best performers in January-February 2019 have a combined market cap of over S$15 billion, and their operations include utilities, oil and gas, real estate investment trusts (REITs), environmental services as well as industrial and construction machinery.

Among these 10, the 5 best performers in the first two months of the year were: Sunpower Group (+80.0%), China Jinjiang Environment (+38.0%), SIIC Environment (+36.4%), China Aviation Oil (+29.2%), and CITIC Envirotech (+19.7%). They have averaged a total return of +40.7% over the Jan-Feb period, bringing their one-year and three-year total returns to -11.1% and +30.2% respectively.

3 of the 5 best performers are REITs and/or real estate developers. For a recently published Market Update on China-related S-REITs and Developers, click here.

The table below details the 10 best-performing pure China-based plays with market cap above S$200 million on SGX, sorted by Jan-Feb 2019 total returns

Name SGX
Code
Market
Cap
S$m
Total
Return
Jan-Feb19
%
Total
Return
1Y
%
Total
Return
3Y
%
Div Yld
%
P/E
(x)
SUNPOWER GROUP 5GD 450 80.0 -0.6 106.7 0.3 7.5
CHINA JINJIANG ENVIRONMENT BWM 852 38.0 16.8 0.0 0.0 0.0
SIIC ENVIRONMENT BHK 964 36.4 -25.0 -43.8 5.4 8.3
CHINA AVIATION OIL G92 1,118 29.2 -10.8 120.3 3.5 9.0
CITIC ENVIROTECH CEE 1,174 19.7 -35.8 -32.0 1.6 10.8
SASSEUR REIT CRPU 868 19.2 0.0 0.0 9.4 0.8~
CHINA EVERBRIGHT WATER U9E 1,017 16.7 -20.3 -25.8 2.6 8.9
YANGZIJIANG SHIPBUILDING BS6 5,642 14.4 -1.3 71.8 3.1 8.6
YANLORD LAND Z25 2,666 13.9 -12.9 42.2 4.7 3.5
EC WORLD REIT BWCU 606 10.1 8.8 0.0 8.0 0.9~
Average 27.8 -8.1 23.9 3.9 7.1

Source: Bloomberg & StockFacts (data as of 28 Feb 2019 & 5 March 2019)
~ P/B instead of P/E ratios used as more relevant for REITs



China’s Growth Outlook

China reduced its economic growth target for 2019 to 6%-6.5%, compared with a goal of “about 6.5%” announced for last year, as it struggles with a debt legacy and ongoing trade tensions with the US. The gross domestic product (GDP) growth target was released on Tuesday in Premier Li Keqiang’s annual work report to the National People’s Congress. The lower band of the target would be the country’s slowest pace of economic growth in almost three decades.

The World Bank already expects a further slowdown in the world’s second-largest economy this year. The agency has forecast growth of 6.2% in 2019, slightly below its previous projections as a result of weaker exports, and down from 6.5% expansion in 2018, it said in the January edition of its “Global Economic Prospects” report.

Between 1999 and 2014, China has averaged a significantly stronger annual economic growth rate of 9.6%, reaching as high as over 14% in 2007. In recent years, the moderation in its growth rates, which still remain above the developing-economy average, has coincided with the government’s policy of pursuing high-quality, rather than high-speed growth.







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