In the first 2 months of 2019, the 5 best-performing healthcare service providers were: ISEC Healthcare (+11.8%), Thomson Medical (+9.5%), Singapore Medical Group (+8.7%), Medinex (+5.6%), and Asian Healthcare Specialists (+5.4%). They averaged a total return of +8.2% over the period.
The combined trading turnover for the 5 largest capitalised healthcare service providers rose 26% to an average S$3.5 million per day in Feb, from S$2.8 million per day in the preceding three months. Thomson Medical and Raffles Medical saw the largest increases in average daily traded values.
Healthcare was a net buy sector for retail investors for the second straight month in Feb, drawing net inflows of about S$6.5 million, after net inflows of S$20.5 million in Jan. This reverses a net retail outflow of S$54.8 million for the sector in calendar year 2018, SGX data showed.
There are 18 healthcare service providers listed on SGX that operate patient care services and facilities in Singapore and worldwide. These facilities include laboratories, hospitals, nursing homes and clinics that offer services and treatments ranging from family medicine, dentistry, endoscopy and aesthetics to gynaecology, oncology, paediatrics, orthopaedics, ophthalmology and even cord blood banking.
4 healthcare service providers that listed on SGX over the last two years were: Medinex Ltd (December 2018), Asian Healthcare Specialists (April 2018), Clearbridge Health (December 2017), and Aoxin Q & M Dental (April 2017).
Healthcare Index Clocks Nearly 10% YTD Total Return
The performance of Singapore’s listed healthcare sector is measured by the iEdge SG All Healthcare Index, which is a free-float, market capitalisation-weighted index comprising 31 stocks. Healthcare service providers are well-represented in the Index, accounting for more than half its constituents.
In the first two months of 2019, the Index generated a total return of 9.7%. This compares with total returns of 4.8% and 5.4% respectively for the benchmark Straits Times Index (STI) and the broader FTSE ST All-Share Index over the same period.
Best-Performing Healthcare Services Stocks in Jan-Feb 2019
In the first two months of 2019, the five best-performing healthcare service providers were: ISEC Healthcare (+11.8%), Thomson Medical Group (+9.5%), Singapore Medical Group (+8.7%), Medinex Ltd (+5.6%), and Asian Healthcare Specialists (+5.4%). These five stocks averaged a total return of +8.2% over the period, bringing their one-year and three-year total returns to -12.2% and +31.1% respectively.
The table below details the 18 healthcare service providers listed on SGX, sorted by YTD total return.
|THOMSON MEDICAL GROUP||A50||2,087||9.5||-31.0||-42.9||-41.9||4.9|
|SINGAPORE MEDICAL GROUP||5OT||206||8.7||-22.3||171.9||-30.4||32.2|
|ASIAN HEALTHCARE SPECIALISTS||1J3||88.0||5.4||NA||NA||NA||NA|
|HEALTH MGMT INTL||588||456||1.5||-12.4||84.3||-17.2||4.1|
|RAFFLES MEDICAL GROUP||BSL||1,977||0.0||-2.4||-20.6||0.2||-20.5|
|HC SURGICAL SPECIALISTS||1B1||87||-1.7||-11.2||NA||-10.9||18.5|
|OUE LIPPO HEALTHCARE||5WA||271||-6.2||-50.2||22.3||-40.6||150.0|
|HEALTHWAY MEDICAL GROUP||5NG||131||-9.4||-43.1||3.6||-40.7||63.6|
|AOXIN Q&M DENTAL||1D4||76.3||-13.0||0.9||NA||10.5||NA|
Five Largest Capitalised Healthcare Providers on SGX
The five largest capitalised healthcare service providers on SGX are: IHH Healthcare, Thomson Medical Group, Raffles Medical Group, Talkmed Group, and Health Management International (HMI). These five stocks, with a combined market capitalisation of over S$20 billion, have averaged a total return of +1.6% in the first two months of this year. This brings their one-year and three-year total returns to -13.7% and +9.7% respectively.
For the month of February 2019, the combined trading turnover for these five largest capitalised healthcare service providers rose by 26% to an average S$3.5 million per day, from an average S$2.8 million per day in the preceding three months. In particular, three of the five largest capitalised healthcare service providers saw higher average daily trading values in February, compared to the previous three months. They were Thomson Medical Group (+52.9%), Raffles Medical Group (+3.0%), and HMI (+1.6%).
Net Buy Sector for Retail Investors
Healthcare was a net buy sector for retail investors for the second straight month in February, drawing inflows of about S$6.5 million, following net inflows of S$20.5 million in January. This reverses a net retail outflow of S$54.8 million for the sector in calendar year 2018, SGX data showed.
For institutional investors, Healthcare was a net sell for the second straight month in February, with net outflows of S$7.9 million, after a net outflow of S$21.5 million in January. This reverses a net institutional inflow of S$49.4 million for the sector in calendar year 2018, according to SGX data.
Defensive With Robust Prospects
Singapore’s healthcare sector is typically viewed as a defensive segment, poised to enjoy multi-year growth prospects. Drivers of Asia’s increased healthcare spending levels include accelerated ageing rates, the rise of lifestyle diseases like diabetes and hypertension, as well as growing disposable incomes.
The majority of Singapore’s healthcare service providers have also pursued international expansion plans in recent years. Their operations and assets span multiple geographies outside Singapore, including markets in South and Southeast Asia, Northeast Asia, as well as Middle East and Europe.Investors can easily participate in the structural Asian healthcare theme through SGX-listed healthcare stocks that are rapidly expanding into regional and global markets to meet growing patient needs.