Global Hardware, Semiconductor and Hi-Tech Manufacturers declined 26% in the 2020 YTD, bringing their median 5 year total returns to a 5% decline. Semiconductor stocks have led declines over past 11 weeks, while also maintaining the strongest 5 years gains.
In Singapore, hi-tech manufacturers, 2 REITs investing in Data Centres, a Business Trust investing in India IT parks, have maintained median 17% annualised total returns over the past 5 years, ranging from 10% for Valuetronics and Ascendas India Trust to 87% for AEM Holdings.
Also amongst Singapore’s 100 most active traded stocks, Sheng Siong has also defended an 11% annualised total return over the past 5 years, with a 15% decline in 2020 YTD, making the stock one of Singapore’s most defensive in recent years.
Of Singapore’s 100 most traded stocks in the 2020 year-through to March 18, 11 stocks have maintained double-digit annualised gains over the past 5 years. The majority of these stocks are involved in hi-tech manufacturing. Supermarket chain Sheng Siong Group is also amongst the 11 stocks, as is Mapletree Industrial Trust, which has been gradually expanding the number of Data Centres in its portfolio in recent years. Ascendas India Trust is also amongst the 11 stocks, and the Business Trust invests in IT parks in India.
All 11 stocks have declined in-line with the STI in the 2020 year through to 18 March, with six of the 11 stocks declining more than the STI. As many as 10 of the 11 stocks are related to hi-tech manufacturing or investment in technology-related property. Sort by turnover rankings in the 2020 year through to this week, the 11 stocks are tabled below.
| Name | SGX Code |
Mkt Cap S$M |
YTD Total Return |
Annualised 5 Year Total Return |
Approx. Turnover Rank in 2020 YTD |
|---|---|---|---|---|---|
| VENTURE CORP | V03 | $4,064 | -13% | 16% | 14 |
| MAPLETREE INDUSTRIAL TRUST | ME8U | $4,688 | -17% | 14% | 18 |
| AEM HOLDINGS | AWX | $404 | -26% | 87% | 25 |
| KEPPEL DC REIT | AJBU | $3,037 | -10% | 20% | 27 |
| UMS HOLDINGS | 558 | $338 | -39% | 17% | 48 |
| HI-P INTERNATIONAL | H17 | $600 | -51% | 15% | 52 |
| SHENG SIONG GROUP | OV8 | $1,594 | -15% | 11% | 60 |
| ASCENDAS INDIA TRUST | CY6U | $1,283 | -27% | 10% | 61 |
| VALUETRONICS HOLDINGS | BN2 | $204 | -43% | 10% | 75 |
| FRENCKEN GROUP | E28 | $238 | -39% | 26% | 87 |
| FU YU CORP | F13 | $149 | -22% | 21% | 98 |
| Median | -26% | 16% | |||
| Average | -28% | 22% |
Source: Thomson Reuters, Bloomberg, Company Financial Reports (Data as of 18 March 2020).
Amongst the 11 stocks, there are a mix of stocks that maintain high beta relative to the STI, and lower beta over the past three declines and recoveries of the STI. Beta is a historical measure of the relative volatility of a stock relative to the broader market. Hence assuming a portfolio replicates the relevant benchmark index that represents the broader market, beta provides past indications of whether the stock added or reduced portfolio risk. To that end, it is not a forward looking indicator.
These 3 declines span the Europe Debt concerns weighing the STI decline 23% (from the preceding peak) to the 2529 low on 5 October 2011, the so-called taper tantrum which saw the STI fall 29% (from the preceding peak) to the 2533 low on 21 January 2016 and the trade war concerns which saw the STI fall 18% (from the preceding peak) to the 2966 low on 30 October 2018.
Of the 11 stocks, Hi-P International has maintained the highest beta coefficients across the aforesaid declines and recoveries. In all three instances, the Hi-P International underperformed the STI in the decline phase, and outperformed the STI in the recovery phase.
| Stock | 6-Jan-11 to 5-Oct-11 |
5-Oct-11 to 22-May-13 |
15-Apr-15 to 21-Jan-16 |
21-Jan-16 to 2-May-18 |
2-May-18 to 30-Oct-18 |
30-Oct-18 to 29-Apr-19 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Beta | Total Return | Beta | Total Return | Beta | Total Return | Beta | Total Return | Beta | Total Return | Beta | Total Return | |
| VENTURE CORPORATION | 0.77 | -28% | 0.69 | 29% | 0.50 | -3% | 0.68 | 173% | 1.27 | -21% | 1.60 | 20% |
| MAPLETREE IND TRUST | 0.72 | 5% | 0.48 | 65% | 0.63 | -2% | 0.53 | 58% | 0.49 | -4% | 0.40 | 15% |
| AEM HOLDINGS | 0.66 | -7% | 0.85 | 131% | 0.90 | -37% | 0.86 | 3011% | 1.29 | -44% | 1.40 | 54% |
| KEPPEL DC REIT | N/A | N/A | N/A | N/A | 0.64 | 1% | 0.57 | 66% | 0.54 | -4% | 0.43 | 16% |
| UMS HOLDINGS | 1.42 | -50% | 1.14 | 139% | 0.67 | -3% | 0.87 | 230% | 1.09 | -38% | 1.47 | 16% |
| HI-P INTERNATIONAL | 1.10 | -51% | 0.94 | 77% | 1.12 | -33% | 0.84 | 387% | 1.73 | -56% | 2.11 | 107% |
| SHENG SIONG GROUP | N/A | N/A | 0.94 | 97% | 0.77 | 7% | 0.51 | 36% | 0.68 | 8% | 0.31 | -4% |
| ASCENDAS INDIA TRUST | 0.80 | -23% | 0.72 | 29% | 0.68 | -18% | 0.46 | 70% | 0.48 | 4% | 0.69 | 23% |
| VALUETRONICS HOLDINGS | 1.04 | -12% | 0.76 | 19% | 1.14 | -15% | 0.98 | 158% | 1.30 | -18% | 1.03 | 15% |
| FRENCKEN GROUP | 0.86 | -4% | 0.63 | -17% | 0.50 | -13% | 0.66 | 213% | 0.86 | -34% | 0.73 | 81% |
| FU YU CORP | 1.21 | -48% | 0.65 | -5% | 1.08 | 10% | 0.71 | 44% | 0.55 | -6% | 0.84 | 33% |
| Median | 0.86 | -23% | 0.74 | 47% | 0.68 | -3% | 0.68 | 158% | 0.86 | -18% | 0.84 | 20% |
| STI (price + dividends) | -21% | 16% | -26% | 54% | -16% | 16% | ||||||
Source: Thomson Reuters, Bloomberg, Company Financial Reports (Data as of 18 March 2020).
Of the 11 stocks, since its listing in November 2014, Keppel DC REIT maintained the lowest beta coefficient for the taper tantrum and trade war concerns, followed by Sheng Siong Group and Mapletree Industrial Trust. Note amidst the taper tantrum and trade war concerns, Sheng Siong Group outperformed the STI during the declining phases, but underperformed in the recovery phases.
