Year in Review: 5 Best-Performing Blue-Chip Stocks of 2023

We continue with our year-in-review series after we featured five companies that raised their dividends last week.

This round, we move on to determine which are the five best-performing blue-chip stocks for 2023.

Blue-chip companies are preferred by investors because of their size, reputation and long track record.

These attributes make them more attractive to own during uncertain times as they have proven themselves over economic cycles.

Here are the five blue-chip candidates that have done well this year.

Sembcorp Industries Ltd (SGX: U96)

Sembcorp Industries, or SCI, is an energy and urban solutions provider with a balanced energy portfolio of 19.4 GW.

The group also has an urban development project portfolio spanning over 13,000 hectares across Asia.

Shares of SCI have shot up close to 44% year-to-date (YTD) to close at S$4.95.

The utility giant reported a mixed set of earnings for the first half of 2023 (1H 2023).

Revenue dipped by 6% year on year to S$3.7 billion while net profit surged by 56% year on year to S$608 million.

After adjusting for exceptional items and discontinued operations, SCI’s net profit would have risen by 8% year on year to S$530 million.

The group recently held its Investor Day 2023 where it pledged to increase its renewables gross installed capacity to 25 GW by 2028.

As of 30 September 2023, its gross installed capacity stood at just 12 GW for both installed and under construction.

Management is working towards this goal with two acquisitions announced last month.

The first was the acquisition of a 245 MW renewables portfolio in Vietnam and the second was the acquisition of 428 MW of wind assets in China and India.

Singapore Airlines Limited (SGX: C6L)

Singapore Airlines, or SIA, is Singapore’s flagship airline.

The carrier’s shares rose 16.2% YTD to S$6.38 as a surge in demand for air travel benefitted the airline.

Its fiscal 2024 first half (1H FY2024) earnings saw a blowout net profit of S$1.4 billion, the highest in the group’s history, on the back of an 8.9% year-on-year increase in revenue to S$9.2 billion.

SIA also declared and paid out an interim dividend of S$0.10.

Looking ahead, the airline has 96 aircraft on order and will also increase its network of destinations through code-sharing agreements with other airlines.

SIA warned of capacity restoration across the industry that may pressure passenger yields while demand for air freight should also remain soft.

Yangzijiang Shipbuilding Holdings Ltd (SGX: BS6)

Yangzijiang Shipbuilding, or YZJ, is one of the largest non-state-owned shipbuilding companies in China.

The group owns four shipyards in Jiangsu province that can manufacture a broad range of commercial vessels such as bulk carriers, LNG carriers, and containerships.

YZJ’s share price has jumped 14.8% YTD to close at S$1.47.

The shipbuilder reported a sparkling set of earnings for 1H 2023 with revenue rising 16% year on year to RMB 11.3 billion.

Net profit soared 47% year on year to RMB 1.7 billion.

YZJ’s recent third quarter 2023 (3Q 2023) business update was also encouraging.

The group reported a record high order book of US$14.8 billion with US$6.5 billion of new orders secured in the first nine months of 2023 (9M 2023).

This level was more than double what the shipbuilder had projected and it is also on track to achieve its delivery target of 57 vessels for this year.

Singapore Technologies Engineering Ltd (SGX: S63)

Singapore Technologies Engineering, or STE, is a technology, defence and engineering group serving customers in more than 100 countries.

STE’s share price has risen by close to 12% YTD to close at S$3.77.

The engineering group reported a respectable set of earnings for 1H 2023.

Revenue rose 13.9% year on year to S$4.9 billion while net profit inched up 0.2% year on year to S$280.6 million.

After excluding exceptional and one-off items, core net profit would have climbed 26% year on year to S$300 million.

STE’s 3Q 2023 business update provided encouraging numbers.

9M 2023’s revenue rose 12% year on year to S$7.3 billion with growth seen across all three segments.

Contract wins for 9M 2023 hit S$11.7 billion, taking STE’s order book to a high of S$27.5 billion as of 30 September 2023.

Singapore Exchange Limited (SGX: S68)

Singapore Exchange Limited, or SGX, is Singapore’s sole stock exchange operator.

Shares of the bourse operator have risen by 8.2% YTD to end at S$9.60.

For its fiscal 2023 (FY2023) ending 30 June 2023, SGX reported an 8.7% year on year rise in revenue to S$1.2 billion.

Net profit excluding exceptional items climbed 10.3% year on year to S$503.2 million.

The stock exchange operator also increased its quarterly dividend from S$0.08 to S$0.085.

SGX plans to grow into a multi-asset hub within Asia and build a fully integrated and scalable foreign exchange platform.

The bourse operator is targeting a high-single-digit year on year percentage revenue growth in the medium term.

Management also intends to increase its dividend per share by a mid-single-digit percentage annually subject to earnings growth.

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Disclosure: Royston Yang owns shares of Singapore Exchange Limited.

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