The listed healthcare sector in Singapore, as tracked by the benchmark iEdge SG All Healthcare Index, comprises companies that operate in the segments of pharmaceuticals and biotechnology, healthcare and patient services, as well as medical equipment and supplies.
In the 2019 YTD, the iEdge SG All Healthcare Index has registered a price gain of +3.0%, compared with gains of 8.9% for the MSCI AC Asia ex-Japan Health Care Index and 7.7% for the MSCI ACWI Asia Health Care Index.
Over the last 10 years, the market cap of Singapore’s healthcare sector – comprising primary and secondary listings – has expanded nearly 13-fold. In comparison, the market cap of healthcare stocks listed in the Asia-Pacific region – for both emerging and developed markets – has grown by approximately 4x.
In the 2019 YTD, the 5 best-performing healthcare services providers on SGX were: ISEC Healthcare (+26.5%), Cordlife Group (+15.6%), Singapore Medical Group (+12.5%), Singapore O&G (+11.4%), and Medinex Ltd (+7.4%). The five have averaged a YTD total return of +14.7%.
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.
Frost & Sullivan estimates that the Asia-Pacific healthcare industry expanded by 11% to US$517 billion in 2018 – representing one of the fastest growing regions worldwide – compared with an average 4.8% growth rate for the global healthcare sector. The positive expansion is fuelled by increasing adoption of technology, innovative healthcare access programs and delivery of care outside traditional hospital settings.
Market Cap Growth in Last Decade
As a result, over the last 10 years, the market capitalisation of Singapore’s healthcare sector – comprising primary and secondary listings – has increased nearly 13-fold. In comparison, the market cap of healthcare stocks listed in the region’s emerging markets has grown by 4.4x, while the market value of healthcare listings in Asia’s developed markets has expanded by 3.8x, over the same period.
Performances of Singapore vs Asia’s Healthcare Indexes
The listed healthcare sector in Singapore, as tracked by the benchmark iEdge SG All Healthcare Index, comprises companies that operate in the segments of pharmaceuticals and biotechnology, healthcare and patient services, as well as medical equipment and supplies.
In the 2019 year-to-date, the iEdge SG All Healthcare Index has registered a price gain of 3.0%, compared with gains of 10.6% for the benchmark Straits Times Index (STI), 8.9% for the MSCI AC Asia ex-Japan Health Care Index, and 7.7% for the MSCI ACWI Asia Health Care Index.
Healthcare Services Providers Pursue Geographic Expansion
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. These 18 healthcare services plays have a combined market capitalisation of more than S$40 billion.
Some of the healthcare services companies that have listed on SGX in the last two years include Medinex Ltd (December 2018), Asian Healthcare Specialists (April 2018), Clearbridge Health (December 2017), and Aoxin Q & M Dental (April 2017).
The majority of Singapore’s healthcare service providers have also pursued international expansion plans in recent years. Their operations and assets span multiple geographies outside Singapore, including markets in South and Southeast Asia, Northeast Asia, as well as Middle East and Europe.
In particular, IHH Healthcare has medical centre and/or hospital operations in China, Hong Kong, India, Brunei and Malaysia, while its Europe and Middle East presence includes Mauritius, United Arab Emirates, Turkey, Bulgaria, Macedonia and the Netherlands. Likewise, OUE Lippo Healthcare has exposure to hospitals in China, Myanmar and Indonesia, as well as nursing and assisted living facilities in Japan. As for home-grown Raffles Medical Group, it now has a presence in 14 cities across Asia – operating hospitals in Hong Kong, Chongqing, Tianjin, Beijing and Shanghai, as well as clinics in Vietnam and Cambodia.
Investors can easily participate in the structural Asian healthcare theme through SGX-listed healthcare stocks that are rapidly expanding into regional and global markets to meet growing patient needs.
Best-Performing Healthcare Services Plays in YTD
In the 2019 YTD, the five best-performing healthcare service providers were: ISEC Healthcare (+26.5%), Cordlife Group (+15.6%), Singapore Medical Group (+12.5%), Singapore O&G (+11.4%), and Medinex Ltd (+7.4%). The five have averaged a YTD total return of +14.7%, bringing their one-year, three-year and five-year total returns to -4.6%, +29.9% and +19.4% respectively.
The tables below detail the 18 healthcare service providers listed on SGX, sorted by YTD total return.
| Name | SGX Code |
Market Cap S$m |
Total Return YTD % |
Total Return 1 Yr % |
Total Return 3 Yr % |
Total Return 5 Yr % |
|---|---|---|---|---|---|---|
| ISEC HEALTHCARE | 40T | 158 | 26.5 | 13.0 | 30.4 | NA |
| CORDLIFE GROUP | P8A | 110 | 15.6 | -38.1 | -69.4 | -57.4 |
| SINGAPORE MEDICAL | 5OT | 213 | 12.5 | -7.2 | 181.2 | 154.2 |
| SINGAPORE O&G | 1D8 | 186 | 11.4 | 9.3 | 7.5 | NA |
| MEDINEX LTD | OTX | 38 | 7.4 | NA | NA | NA |
| OUE LIPPO HEALTHCARE | 5WA | 298 | 3.1 | -40.2 | 3.5 | -74.9 |
| CLEARBRIDGE HEALTH | 1H3 | 84 | 3.0 | -67.2 | NA | NA |
| THOMSON MEDICAL | A50 | 19,567 | 1.3 | -16.5 | -47.2 | -18.6 |
| HEALTH MGMT INTL | 588 | 452 | 0.6 | -17.2 | 74.1 | 233.5 |
| IHH HEALTHCARE | Q0F | 15,697 | 0.0 | -11.8 | -21.0 | 21.1 |
| ASIAN HEALTHCARE | 1J3 | 83 | -0.4 | -13.1 | NA | NA |
| HC SURGICAL SPECIALISTS | 1B1 | 86 | -2.6 | -12.6 | NA | NA |
| RAFFLES MEDICAL | BSL | 1,906 | -3.6 | -6.7 | -29.0 | -6.0 |
| Q&M DENTAL | QC7 | 369 | -6.0 | -22.3 | -26.9 | 32.3 |
| HEALTHWAY MEDICAL | 5NG | 131 | -9.4 | -40.8 | -12.1 | -54.0 |
| AOXIN Q & M DENTAL | 1D4 | 78 | -10.9 | -10.0 | NA | NA |
| TALKMED GROUP | 5G3 | 690 | -12.5 | -22.5 | 18.5 | 29.8 |
| ASIAMEDIC LTD | 505 | 6.6 | -19.0 | -69.1 | -75.4 | -82.1 |
| Average | 0.9 | -20.7 | 1.9 | 9.9 |
| Name | SGX Code |
Market Cap S$m |
Dividend Ind Yield % |
P/E (x) |
ROE % |
|---|---|---|---|---|---|
| ISEC HEALTHCARE | 40T | 158 | 5.1 | 18.8 | 12.7 |
| CORDLIFE GROUP | P8A | 110 | 0.8 | 26.7 | 3.5 |
| SINGAPORE MEDICAL | 5OT | 213 | NA | 16.5 | 10.8 |
| SINGAPORE O&G | 1D8 | 186 | 4.4 | 20.3 | 20.8 |
| MEDINEX LTD | OTX | 38 | 2.9 | 38.3 | 8.3 |
| OUE LIPPO HEALTHCARE | 5WA | 298 | NA | NA | -6.2 |
| CLEARBRIDGE HEALTH | 1H3 | 84 | NA | NA | -34.0 |
| THOMSON MEDICAL | A50 | 19,567 | 0.3^ | 180.5 | 1.6 |
| HEALTH MGMT INTL | 588 | 452 | 1.2 | 23.9 | 25.2 |
| IHH HEALTHCARE | Q0F | 15,697 | 0.5 | 85.6 | 2.3 |
| ASIAN HEALTHCARE | 1J3 | 83 | 1.6 | 27.7 | NA |
| HC SURGICAL SPECIALISTS | 1B1 | 86 | 3.4 | 11.1 | 43.5 |
| RAFFLES MEDICAL | BSL | 1,906 | 2.4 | 27.6 | 8.8 |
| Q&M DENTAL | QC7 | 369 | 1.7 | 25.9 | 12.8 |
| HEALTHWAY MEDICAL | 5NG | 131 | NA | NA | -3.2 |
| AOXIN Q & M DENTAL | 1D4 | 78 | 2.0 | NA | -0.2 |
| TALKMED GROUP | 5G3 | 690 | 3.5 | 22.6 | 38.4 |
| ASIAMEDIC LTD | 505 | 6.6 | NA | NA | -70.7 |
| Average | 1.7 | 29.2 | 4.1 |
Source: Bloomberg & StockFacts (data as of 2 May 2019)
^ unpaid
