Singapore’s stock market benchmark, the Straits Times Index (SGX: ^STI), started the new year positively. For the month of January, the index rose 4%, or 121 points, to 3,190. Of the 30 Straits Times Index components, 28 were in the positive territory, while the remaining two were in the red.
The biggest winner of the lot was Thailand’s leading beverage producer, Thai Beverage Public Company Limited (SGX: Y92). Shares in the producer of Chang beer led the pack with a 19.7% increase to S$0.73 each. The rise is a sharp reversal from last year’s performance where the company posted a negative 31.7% total shareholder return.
For the financial year ended 30 September 2018, Thai Beverage’s revenue grew 21% to THB 229.7 billion, but net profit attributable to shareholders fell 46% to THB 18.5 billion. With the lower earnings, the company slashed its total dividend for the year to THB 0.39 per share from THB 0.67 per share a year ago.
Another big gainer in the index was property giant, CapitaLand Limited (SGX: C31). CapitaLand’s shares climbed 7.1% to S$3.33 apiece for the month.
On January 14, the company announced it had entered a deal with Temasek to acquire Ascendas Pte Ltd and Singbridge Pte Ltd fully. The duo, known collectively as Ascendas-Singbridge, are subsidiaries of Temasek.
In the news release, Lee Chee Koon, CapitaLand’s president and group chief executive, said:
“As CapitaLand continues its leadership in residential, retail and lodging, the combined platforms will give us capabilities across the commercial/business space value chain, while adding a strong foothold in logistics and business parks. Geographically, the deal strengthens CapitaLand’s presence in our core markets of Singapore and China, while adding meaningful scale in India, US and Europe. This deal immediately adds a portfolio of operating assets that contribute income today, while adding a sizeable pipeline of development projects for the future. Our fund management business will be strengthened by the enlarged platform, offering both breadth and depth of asset classes. I am confident that this will allow the Group to build a diversified and resilient company, one that can deliver sustainable returns above our cost of equity on a long-term basis. We will be able to do this because of the scale and capabilities this transaction creates for the Group to compete globally.”
The following companies and real estate investment trusts (REITs), which released their earnings update in January, were also in the green (respective earnings coverage are in the hyperlinks):
- Keppel Corporation Limited (SGX: BN4) – here
- Singapore Exchange Limited (SGX: S68) – here
- Singapore Press Holdings Limited (SGX: T39) – here
- Ascendas Real Estate Investment Trust (SGX: A17U) – here
- CapitaLand Commercial Trust (SGX: C61U) – here
- CapitaLand Mall Trust (SGX: C38U) – here
On the flipside, Dairy Farm International Holdings Ltd (SGX: D01) and Jardine Matheson Holdings Limited (SGX: J36) performed poorly in January. Dairy Farm’s share price inched down by 0.2% to US$9.03 while Jardine Matheson’s share price fell 4% to US$66.82.
Towards the end of the month, Jardine Matheson was in the news unexpectedly. Its shares plunged just before the stock market opened on 24 January to US$10.99 each, down sharply from the previous day’s close of US$66.47. However, the shares quickly regained the losses, and the company finished the day 0.53% higher at US$66.82.
The Singapore Exchange said that “trading was orderly and there was no sign of manipulation”. It also added that “the orders were not due to fat finger errors or any malfunctioning systems on the part of the participants”.
The SPDR STI ETF (SGX: ES3), an exchange-traded fund which can be taken as a proxy for the Straits Times Index, was valued at a price-to-earnings ratio of 11.3 and had a distribution yield of 3.5% on 31 January 2019.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of CapitaLand, Singapore Exchange, Ascendas Real Estate Investment Trust, CapitaLand Commercial Trust, CapitaLand Mall Trust, and Dairy Farm International. Motley Fool Singapore contributor Sudhan P owns shares in Singapore Exchange, CapitaLand Commercial Trust, and CapitaLand Mall Trust.
Motley Fool Singapore 2019