Happy National Day!
Did you know…
The Singapore Exchange (SGX) was formed on 1 December 1999. SGX came into formation after combining three entities, namely Stock Exchange of Singapore, Singapore International Monetary Exchange and Securities Clearing and Computer Services Pte.
Compared to New York Stock Exchange and Nasdaq, which was formed on 17 May 1792 and 8 February 1971, SGX is relatively young.
SGX started with an estimate of 400 companies listed on its exchange when its IPO back in 2000. At present, it has now increased to 700 companies.
The Straits Time Index (STI) is a market capitalisation weighted index which dates back to 1966. As of 2021, it currently tracks the performance of the top 30 most prominent and most liquid companies listed on SGX.
Did you know STI used to have 50 holdings?
It was reduced to 30 on 10 January 2008 after it was revamped.
The first STI ETF (SPDR Straits Time Index ETF) was listed in April 2002.
Since its inception, it returned 238.30% with dividends reinvested. Annualising it, we will get 6.58% per year.
The STI index has also changed a lot since 2003.
19 Companies that are still on the index are:
As a comparison, the chart below shows the holdings in 2005.
Between 2009 to 2019, there were 279 new companies listed on SGX.
However, in the same period, there were more delisting at 302.
SGX does not just have Singapore Companies listed on it.
In fact, approximately 40% of them are foreign listings.
Currently, the smallest company on SGX in terms of market capitalisation is Plastoform (SGX:AYD) with a total market cap of $500K.
Plastoform was founded in 1982, headquartered in Hong Kong and it is involved in design, development, and manufacture of audio devices.
The largest company on SGX in terms of market capitalisation is DBS (SGX:D05), with a total market cap of $80 billion.
The cheapest company on SGX in terms of price to earnings ratio is BlackGold Natural Resources (SGX:41H), with a P/E of 0.012.
BlackGold Natural Resources was founded in 1997 and is headquartered in Singapore. However, they focus on the supply of coal to power plants located in Riau province, Sumatra, Indonesia.
The most expensive company on SGX in terms of Price to Earnings ratio is Suntar Eco-City (SGX:BKZ), with a P/E of 1,785.
Suntar Eco-City was founded in 2006. It manufactures and sells pharmaceutical ingredient products and is involved in Property Development. Its business operates mostly in the China domestic market.
5 Singapore Blue Chip Stocks with more than 4% yield currently are:
Did you know that CDP operates a Securities Borrowing & lending (SBL) programme, which allows you to lend your securities held in CDP accounts?
In return, you get to earn additional income just by holding the stock.
As of May 2021, the top securities on loan is MM2 Asia Ltd (SGX:1B0).
During the 2008 Financial Crisis, Singapore Market crashed around 56% and lasted two years.
Imagine the heartpain.
M1 was once listed on the exchange along with SingTel.
It was officially delisted in 2019 after Keppel and SPH accumulated over 90% of their shares.
SMRT Corporation Ltd was delisted in 2016 following a buyout by Temasek.
The move was to allow SMRT to focus on serving the commuters than maximise their profits.
In total, SMRT had only been a publicly listed entity for 16 years when it went public in 2000. (Will this happen to other companies like SBS transit or Singapore Airlines?)
Neptune Orient Lines (NOL), which was founded in 1968 as Singapore’s national flag carrier, was delisted in 2016 when French shipping giant CMA CGM acquired it.
This came after it racked up more than $1.5 billion in losses over the years while dealing with poor global demand.
If you had held Singtel since its IPO, you would have received $2.967 in dividends, per share.
With the IPO price of $2 per share, it would have returned you 161%. Which is around 4.5% annualised return.
Temasek Holdings is an Investment company owned by the Singapore Government and its stake in companies are usually seen as a strong backer.
Here are some of the Singapore companies which Temasek has stakes in as of March 2020:
Since 1974, Temasek Holdings total shareholder return by market value was 14%, annualised.
This was double that of MSCI Singapore and MSCI World Index. (No wonder some Singaporeans try to copy Temasek’s portfolio.)
As of 2020, Temasek Holdings exposure to China has exceeded Singapore.
Maybe it’s time to look into China stocks!
Here are some companies currently helmed by former SAF chiefs.
Ng Yat Chung, the current SPH CEO since 2017, served as the Chief of Defence Force in the SAF.
Before that, he was also Neptune Orient Lines President and CEO, which is now sold to French shipping giant CMA CGM.
Neo Kian Hong, who is currently the CEO of SMRT, served as SAF Chief of Defence Force.
To be honest, I thought there were more, but I was wrong.
Bear in mind, this was a company that IPO at a share price of $25.80 and was well oversubscribed. That said, markets are always changing, and if the company fails to adapt, it will be left behind.
That said, Creative Technology has been working on new audio technology like its Super X-Fi and 3D sound, however the impact remains lacklustre.
If you had held SPH since 2005, you would have received around $3.41 in dividend per share.
Comparing it to its starting price of $4.62, SPH would have given you a total return of 12% if you held it till today. This is around 0.75% annualised return.