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It’s a Wrap: The Top 3 and Bottom 3 Blue-Chips for December

Sudhan P.

Singapore’s stock market benchmark, the Straits Times Index (SGX: ^STI), ended December in the red.

For the month, the index tumbled 1.6% to 3,069. Of the 30 index components, 10 were in the positive territory, three were flat while the remaining 17 were in the red.

The top three best-performers of the Straits Times Index for December were Jardine Matheson Holdings Limited (SGX: J36), Dairy Farm International Holdings Ltd (SGX: D01) and Wilmar International Limited (SGX: F34).Source: S&P Global Market Intelligence

Jardine Matheson is a diversified Asian-based business group with interests in a few listed entities in Singapore, including Dairy Farm. The latter operates supermarkets, hypermarkets, convenience stores, and health and beauty, and home furnishings stores in Asia.

For its third quarter of 2018, Dairy Farm released an interim management statement saying that its businesses produced mixed results during the period. It elaborated:

“Although there was a strong performance in Health and Beauty and good results from Home Furnishings and Restaurants, the performance of the Hong Kong Food business has softened and the Food businesses across Southeast Asia continue to face significant challenges. These challenges are expected to continue for the remainder of the year and the Group’s full year results are also expected to be impacted by increasing costs from its continuing programme of investment in technology, supply chain infrastructure, stores and people in order to improve the long-term performance of the business.”

For the whole of 2017, Dairy Farm’s net profit slumped 14% year-on-year to US$404 million. It would be interesting to note how 2018’s net profit compares with that of 2017 when the company announces its earnings later this year.

On the other end of the winner-loser spectrum, Singapore Press Holdings Limited (SGX: T39), Venture Corporation Ltd (SGX: V03) and Hutchison Port Hldg Trust (SGX: NS8U) were the worst performers in December.Source: S&P Global Market Intelligence

The biggest loser of the lot was Singapore Press Holdings (SPH), falling 11% for the month.

For the financial year ended 31 August 2018 (FY2018), SPH saw its revenue fall by 4.8% year-on-year to S$982.6 million. Meanwhile, net profit tumbled 19.7% to S$281.1 million. The lower net profit was partly due to the lack of one-off gain on divestment of a joint venture in FY2017. Excluding the one-time gain, net profit would have increased by 2.4%.

SPH will announce its financial results for the first quarter ended 30 November 2018 on 11 January 2019.

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 11.1 and had a distribution yield of 3.6% on 31 December 2018.

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Editor's note: Venture's dividend yield has been updated as the previous version contained an error. 

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 Dairy Farm International. Motley Fool Singapore contributor Sudhan P doesn't own shares in any companies mentioned.