SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.





Real Estate, Manufacturing and Food &amp; Beverage stocks made up close to half of Singapore’s top 200 stocks by turnover in the first 5 months of 2019. The stocks representing tech–laden Manufacturing were the best performers in 2019 YTD and preceding two years, with F&amp;B the best performer in 2016. 
	 
	
Distinct drivers of the three sectors included interest rate outlooks and property prices for Real Estate, technological advancements, value chain integration and global trade for Manufacturing while incomes, tastes, preferences and tourism drove Food &amp; Beverage sales.  
	 
	
Real estate stocks showed the most consistency in returns, with the least standard deviation amongst the individual stock performances, followed by food &amp; beverage stocks, with the individual manufacturing stocks showing the most performance deviation in past years.  
	 
	Returns amongst the relevant 23 manufacturing stocks have been more constant in the 2019 YTD, with the 18% average total return generated by  19 gainers and four decliners, and a median total return of 19%. Hi-P Int, Frencken &amp; Sunpower led the manufacturers over the 23 weeks. 

As 2019 rapidly approaches the halftime mark of 30 June, clear drivers of investor sentiment in the year thus far have included concerns of global growth deceleration at home and abroad, resumption of trade frictions amongst the world’s two largest economies in early May, and a more dovish outlook for US interest rates.

In Singapore, the Straits Times index (“STI”) has generated  a total return of 6.8% in the 2019 year-to-date, in-line with the FTSE ASEAN All Share Index which has gained 7.4%. 

Looking beyond the STI, the 200 most actively traded stocks have generated an average total return of 8.0%. This does not include the average total returns of RHT Health Trust, Memtech International and Indofood Agri Resources which averaged 89.2% gains on premium cash offers for these businesses.

60 Real Estate Stocks Amongst Top 200 Stocks by Turnover 

Singapore’s strong property and infrastructure fundamentals have provided beachheads for Singapore’s listed Real Estate Sector. For the first five months of 2019, the 60 Real Estate stocks amongst the 200 most active traded stocks by turnover accounted for the most day-to-day market turnover, which was followed by Financial Services. As discussed recently (click here) this year Singapore REITs have attracted investment flows from global funds which has included private equity funds.

The 23 manufacturing stocks that were amongst the 200 stocks by turnover accounted for the most day-to-day turnover after the 11 financial services stocks. After Real Estate’s 60 stocks, the 23 manufacturing stocks led by the likes of Yangzijiang Shipbuilding, Venture Corporation and Singapore Tech Engineering, contributed the next most number of stocks in the top 200 by turnover. Note these manufacturing stocks do not include Food Manufacturers or Processors, and span diverse business from advanced electronics to healthcare products.

With Food and Beverage (“F&amp;B”) contributing 14 stocks to the top 200 by turnover, and the next highest number of stocks after Manufacturing, the three sectors of Real Estate, Manufacturing and F&amp;B together made up 97 stocks. This was close to half the top 200 stocks by turnover. The average total returns of the three genres of stocks over recent years are illustrated in the chart below. 

      
    
    Total Returns of Three Genres
The average total returns illustrated above were built on various levels of consistency across the performances of each of the Sector’s stocks. For instance, the 60 real estate stocks showed the most consistency, with the least standard deviation amongst the individual stock performances in all four time periods.

This was followed by F&amp;B, which saw more consistency in the performances across its relevant 14 stocks than Manufacturing over the past three years ending 2018. As noted above, Singapore manufacturing stocks span a wide range of industries, with the diversification exponentiated by the geographical reach of these businesses. This was a contributing factor to the individual manufacturing stocks showing the most performance deviation over the preceding three years.  However, in the 2019 year to date, performances across manufacturing stocks have seen marginally less deviation than the F&amp;B stocks. 

The comparative performances of the relevant stocks are tabled below, with each table sorted by stocks with the most turnover over the first five months of 2019.  The 60 real estate stocks maintain a combined market capitalisation of S$175 billion, the 23 manufacturing stocks maintain a total market capitalisation of S$35 billion and the 14 F&amp;B stocks maintain a total market capitalisation of S$60 billion. Note the designated F&amp;B stocks do not include Palm Oil producers.




			Real Estate
			
			
			Stock

			Code
			
			
			2016 TR %
			
			
			2017 TR %
			
			
			TR 2018 %
			
			
			2019 TR to 11 June %
			
		


			ASCENDAS REAL ESTATE INV TRT
			
			
			A17U
			
			
			4.6
			
			
			27.4
			
			
			0.3
			
			
			18.7
			
		


			CAPITALAND
			
			
			C31
			
			
			-7.2
			
			
			20.1
			
			
			-9.0
			
			
			13.4
			
		


			CAPITALAND COMMERCIAL TRUST
			
			
			C61U
			
			
			16.6
			
			
			42.1
			
			
			-5.0
			
			
			19.3
			
		


			CAPITALAND MALL TRUST
			
			
			C38U
			
			
			3.0
			
			
			19.5
			
			
			12.7
			
			
			16.3
			
		


			MAPLETREE LOGISTICS TRUST
			
			
			M44U
			
			
			10.8
			
			
			38.7
			
			
			1.5
			
			
			24.9
			
		


			HONGKONG LAND HOLDINGS
			
			
			H78
			
			
			-4.8
			
			
			5.5
			
			
			-6.1
			
			
			10.8
			
		


			CITY DEVELOPMENTS
			
			
			C09
			
			
			10.3
			
			
			53.1
			
			
			-33.8
			
			
			12.9
			
		


			SUNTEC REIT
			
			
			T82U
			
			
			13.2
			
			
			37.6
			
			
			-12.8
			
			
			9.5
			
		


			MAPLETREE COMMERCIAL TRUST
			
			
			N2IU
			
			
			14.9
			
			
			23.0
			
			
			7.6
			
			
			25.5
			
		


			UOL GROUP
			
			
			U14
			
			
			-1.5
			
			
			51.2
			
			
			-28.8
			
			
			18.7
			
		


			MAPLETREE NORTH ASIA COMMERC
			
			
			RW0U
			
			
			11.7
			
			
			38.3
			
			
			-1.1
			
			
			22.9
			
		


			KEPPEL REIT
			
			
			K71U
			
			
			17.0
			
			
			30.1
			
			
			-5.2
			
			
			11.3
			
		


			MAPLETREE INDUSTRIAL TRUST
			
			
			ME8U
			
			
			15.8
			
			
			32.2
			
			
			-0.7
			
			
			15.5
			
		


			FRASERS LOGISTICS &amp; INDUSTRI
			
			
			BUOU
			
			
			0.0
			
			
			34.0
			
			
			-4.2
			
			
			19.1
			
		


			KEPPEL DC REIT
			
			
			AJBU
			
			
			26.1
			
			
			27.0
			
			
			-0.7
			
			
			24.6
			
		


			FRASERS CENTREPOINT TRUST
			
			
			J69U
			
			
			9.1
			
			
			24.8
			
			
			2.2
			
			
			20.3
			
		


			ASCOTT RESIDENCE TRUST
			
			
			A68U
			
			
			2.4
			
			
			20.2
			
			
			-6.1
			
			
			22.6
			
		


			FRASERS COMMERCIAL TRUST
			
			
			ND8U
			
			
			7.0
			
			
			27.1
			
			
			-1.7
			
			
			17.7
			
		


			CDL HOSPITALITY TRUSTS
			
			
			J85
			
			
			8.7
			
			
			39.9
			
			
			-8.6
			
			
			13.6
			
		


			YANLORD LAND GROUP
			
			
			Z25
			
			
			33.1
			
			
			25.6
			
			
			-21.6
			
			
			7.9
			
		


			CAPITALAND RETAIL CHINA TRUS
			
			
			AU8U
			
			
			-1.0
			
			
			29.4
			
			
			-12.5
			
			
			16.3
			
		


			ESR-REIT
			
			
			J91U
			
			
			3.6
			
			
			12.0
			
			
			-1.8
			
			
			12.7
			
		


			CROMWELL EUROPEAN REIT
			
			
			CNNU
			
			
			0.0
			
			
			0.0
			
			
			-13.3
			
			
			16.0
			
		


			STARHILL GLOBAL REIT
			
			
			P40U
			
			
			4.7
			
			
			11.6
			
			
			-6.5
			
			
			13.7
			
		


			YING LI INTERNATIONAL REAL E
			
			
			5DM
			
			
			-10.2
			
			
			1.3
			
			
			-23.2
			
			
			20.7
			
		


			CACHE LOGISTICS TRUST
			
			
			K2LU
			
			
			-3.5
			
			
			19.0
			
			
			-12.2
			
			
			12.4
			
		


			FAR EAST HOSPITALITY TRUST
			
			
			Q5T
			
			
			-3.1
			
			
			27.9
			
			
			-10.8
			
			
			9.8
			
		


			MANULIFE US REAL ESTATE INV
			
			
			BTOU
			
			
			0.0
			
			
			18.3
			
			
			-7.2
			
			
			18.5
			
		


			ASCENDAS INDIA TRUST
			
			
			CY6U
			
			
			23.3
			
			
			19.1
			
			
			0.2
			
			
			27.7
			
		


			OUE HOSPITALITY TRUST
			
			
			SK7
			
			
			-1.1
			
			
			38.2
			
			
			-16.0
			
			
			6.6
			
		


			SASSEUR REAL ESTATE INVESTME
			
			
			CRPU
			
			
			0.0
			
			
			0.0
			
			
			0.0
			
			
			31.7
			
		


			OXLEY HOLDINGS
			
			
			5UX
			
			
			1.0
			
			
			71.9
			
			
			-44.7
			
			
			8.0
			
		


			SPH REIT
			
			
			SK6U
			
			
			5.4
			
			
			16.8
			
			
			0.6
			
			
			7.8
			
		


			APAC REALTY
			
			
			CLN
			
			
			0.0
			
			
			0.0
			
			
			-46.4
			
			
			27.8
			
		


			HONG FOK CORP
			
			
			H30
			
			
			-2.4
			
			
			38.2
			
			
			-19.9
			
			
			23.9
			
		


			ASCENDAS HOSPITALITY TRUST
			
			
			Q1P
			
			
			2.9
			
			
			30.8
			
			
			-3.6
			
			
			25.8
			
		


			LIPPO MALLS INDONESIA RETAIL
			
			
			D5IU
			
			
			27.3
			
			
			17.5
			
			
			-50.6
			
			
			28.6
			
		


			WING TAI HOLDINGS
			
			
			W05
			
			
			-6.1
			
			
			47.1
			
			
			-11.8
			
			
			5.2
			
		


			KEPPEL-KBS US REIT
			
			
			CMOU
			
			
			0.0
			
			
			0.0
			
			
			-23.9
			
			
			28.3
			
		


			FRASERS HOSPITALITY TRUST
			
			
			ACV
			
			
			-1.8
			
			
			29.3
			
			
			-4.7
			
			
			4.6
			
		


			AIMS APAC REIT
			
			
			O5RU
			
			
			3.4
			
			
			13.5
			
			
			3.9
			
			
			10.1
			
		


			ACCORDIA GOLF TRUST
			
			
			ADQU
			
			
			31.0
			
			
			17.0
			
			
			-21.1
			
			
			11.1
			
		


			OUE COMMERCIAL REAL ESTATE I
			
			
			TS0U
			
			
			14.6
			
			
			11.0
			
			
			-22.6
			
			
			9.3
			
		


			SOILBUILD BUSINESS SPACE REI
			
			
			SV3U
			
			
			-8.7
			
			
			14.2
			
			
			-6.2
			
			
			8.9
			
		


			OUE
			
			
			LJ3
			
			
			0.5
			
			
			8.2
			
			
			-22.2
			
			
			12.2
			
		


			FRASERS PROPERTY
			
			
			TQ5
			
			
			-1.2
			
			
			39.0
			
			
			-17.4
			
			
			15.1
			
		


			SABANA SHARIAH COMP IND REIT
			
			
			M1GU
			
			
			-33.5
			
			
			12.2
			
			
			6.8
			
			
			18.2
			
		


			TUAN SING HOLDINGS
			
			
			T24
			
			
			-10.6
			
			
			60.8
			
			
			-18.9
			
			
			2.3
			
		


			GUOCOLAND
			
			
			F17
			
			
			4.4
			
			
			28.1
			
			
			-16.3
			
			
			10.0
			
		


			EC WORLD REIT
			
			
			BWCU
			
			
			0.0
			
			
			8.0
			
			
			-1.2
			
			
			16.1
			
		


			DASIN RETAIL TRUST
			
			
			CEDU
			
			
			0.0
			
			
			0.0
			
			
			7.3
			
			
			5.4
			
		


			BUKIT SEMBAWANG ESTATES
			
			
			B61
			
			
			6.7
			
			
			47.1
			
			
			-7.0
			
			
			-1.4
			
		


			IREIT GLOBAL
			
			
			UD1U
			
			
			12.9
			
			
			17.3
			
			
			0.8
			
			
			8.1
			
		


			HO BEE LAND
			
			
			H13
			
			
			3.8
			
			
			24.3
			
			
			0.1
			
			
			4.5
			
		


			PROPNEX
			
			
			OYY
			
			
			0.0
			
			
			0.0
			
			
			0.0
			
			
			18.2
			
		


			UNITED INDUSTRIAL CORP
			
			
			U06
			
			
			-2.8
			
			
			20.6
			
			
			-16.8
			
			
			8.9
			
		


			FORTUNE REIT
			
			
			F25U
			
			
			17.5
			
			
			8.0
			
			
			-0.4
			
			
			23.6
			
		


			BOUSTEAD SINGAPORE
			
			
			F9D
			
			
			-0.6
			
			
			9.8
			
			
			-3.4
			
			
			-2.5
			
		


			SINGHAIYI GROUP
			
			
			5H0
			
			
			-13.4
			
			
			30.7
			
			
			-22.5
			
			
			11.8
			
		


			CENTURION CORP
			
			
			OU8
			
			
			-10.7
			
			
			65.9
			
			
			-16.5
			
			
			1.1
			
		


			Average:
			
			
			 
			
			
			4.1
			
			
			24.7
			
			
			-10.0
			
			
			14.7
			
		

 




			Manufacturing
			
			
			Stock

			Code
			
			
			2016 TR %
			
			
			2017 TR %
			
			
			TR 2018 %
			
			
			2019 TR to 11 June %
			
		


			YANGZIJIANG SHIPBUILDING
			
			
			BS6
			
			
			-22.3
			
			
			86.3
			
			
			-11.4
			
			
			19.2
			
		


			VENTURE CORP
			
			
			V03
			
			
			28.0
			
			
			115.4
			
			
			-29.1
			
			
			19.1
			
		


			SINGAPORE TECH ENGINEERING
			
			
			S63
			
			
			12.3
			
			
			5.0
			
			
			11.8
			
			
			20.3
			
		


			AEM HOLDINGS
			
			
			AWX
			
			
			195.3
			
			
			498.6
			
			
			1.5
			
			
			22.4
			
		


			SEMBCORP MARINE
			
			
			S51
			
			
			-19.3
			
			
			34.9
			
			
			-15.9
			
			
			-1.9
			
		


			HI-P INTERNATIONAL
			
			
			H17
			
			
			4.6
			
			
			326.5
			
			
			-50.8
			
			
			57.1
			
		


			VALUETRONICS HOLDINGS
			
			
			BN2
			
			
			34.3
			
			
			103.5
			
			
			-22.8
			
			
			-2.3
			
		


			SUNPOWER GROUP
			
			
			5GD
			
			
			57.4
			
			
			-11.6
			
			
			-27.6
			
			
			53.0
			
		


			CREATIVE TECHNOLOGY
			
			
			C76
			
			
			-11.9
			
			
			10.9
			
			
			254.2
			
			
			0.5
			
		


			FRENCKEN GROUP
			
			
			E28
			
			
			30.3
			
			
			132.4
			
			
			-18.9
			
			
			53.9
			
		


			HAW PAR CORP
			
			
			H02
			
			
			14.9
			
			
			27.2
			
			
			7.9
			
			
			18.8
			
		


			SUNNINGDALE TECH
			
			
			BHQ
			
			
			22.4
			
			
			83.6
			
			
			-21.9
			
			
			-2.8
			
		


			FU YU CORP
			
			
			F13
			
			
			27.2
			
			
			6.6
			
			
			10.1
			
			
			13.2
			
		


			SARINE TECHNOLOGIES
			
			
			U77
			
			
			20.9
			
			
			-42.4
			
			
			-52.0
			
			
			-29.2
			
		


			RIVERSTONE HOLDINGS
			
			
			AP4
			
			
			-25.0
			
			
			25.6
			
			
			7.9
			
			
			-17.9
			
		


			INNOTEK
			
			
			M14
			
			
			48.6
			
			
			32.7
			
			
			18.3
			
			
			30.0
			
		


			MANUFACTURING INTEGRATION TE
			
			
			M11
			
			
			-25.7
			
			
			48.3
			
			
			18.1
			
			
			22.0
			
		


			CHUAN HUP HOLDINGS
			
			
			C33
			
			
			-15.7
			
			
			37.5
			
			
			-3.7
			
			
			32.1
			
		


			JEP HOLDINGS
			
			
			1J4
			
			
			-31.0
			
			
			86.2
			
			
			-3.6
			
			
			12.6
			
		


			HANWELL HOLDINGS
			
			
			DM0
			
			
			-9.4
			
			
			31.3
			
			
			-43.6
			
			
			41.5
			
		


			MIYOSHI
			
			
			M03
			
			
			19.0
			
			
			62.8
			
			
			-39.6
			
			
			4.9
			
		


			AVARGA
			
			
			U09
			
			
			64.7
			
			
			1.8
			
			
			-23.4
			
			
			20.7
			
		


			HALCYON AGRI CORP
			
			
			5VJ
			
			
			-8.3
			
			
			-5.7
			
			
			-29.8
			
			
			24.4
			
		


			Average:
			
			
			 
			
			
			17.9
			
			
			73.8
			
			
			-2.8
			
			
			17.9
			
		

 




			F&amp;B
			
			
			Stock

			Code
			
			
			2016 TR %
			
			
			2017 TR %
			
			
			TR 2018 %
			
			
			2019 TR to 11 June %
			
		


			THAI BEVERAGE PCL
			
			
			Y92
			
			
			27.2
			
			
			11.3
			
			
			-31.7
			
			
			40.8
			
		


			WILMAR INTERNATIONAL
			
			
			F34
			
			
			25.0
			
			
			-12.1
			
			
			4.3
			
			
			10.8
			
		


			SATS
			
			
			S58
			
			
			30.9
			
			
			10.9
			
			
			-7.2
			
			
			8.2
			
		


			JAPFA
			
			
			UD2
			
			
			94.0
			
			
			-42.8
			
			
			44.6
			
			
			-19.6
			
		


			OLAM INTERNATIONAL
			
			
			O32
			
			
			12.2
			
			
			6.5
			
			
			-15.9
			
			
			15.7
			
		


			KOUFU GROUP
			
			
			VL6
			
			
			0.0
			
			
			0.0
			
			
			0.0
			
			
			14.8
			
		


			SINO GRANDNESS FOOD INDUSTRY
			
			
			T4B
			
			
			-33.8
			
			
			-8.9
			
			
			-38.2
			
			
			-61.0
			
		


			DELFI
			
			
			P34
			
			
			12.0
			
			
			-35.1
			
			
			-5.3
			
			
			-6.8
			
		


			QAF
			
			
			Q01
			
			
			37.8
			
			
			-16.4
			
			
			-45.0
			
			
			36.5
			
		


			JUMBO GROUP
			
			
			42R
			
			
			49.4
			
			
			-9.6
			
			
			-31.4
			
			
			1.7
			
		


			FRASER AND NEAVE
			
			
			F99
			
			
			2.8
			
			
			26.0
			
			
			-32.1
			
			
			4.4
			
		


			BREADTALK GROUP
			
			
			CTN
			
			
			5.4
			
			
			52.1
			
			
			-1.6
			
			
			-2.5
			
		


			JB FOODS
			
			
			BEW
			
			
			32.0
			
			
			69.2
			
			
			38.7
			
			
			11.3
			
		


			KIMLY
			
			
			1D0
			
			
			0.0
			
			
			0.0
			
			
			-30.6
			
			
			2.8
			
		


			Average:
			
			
			 
			
			
			21.1
			
			
			3.7
			
			
			-10.8
			
			
			4.1
			
		

Source: SGX StockFacts, Bloomberg (Data as of 11 June 2019). Note TR = Total Return which assumes dividends are reinvested.

Distinct drivers of the three sectors included interest rate outlooks and property prices for real estate, technological advancements, value chain integration and global trade for manufacturing while incomes, tastes, preferences and tourism drive F&amp;B sales.



Real Estate, Manufacturing and F&B Shares on the Move in 1H19    

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

Leong Hup International / Equity Capital Markets

<a href="https://www.smartkarma.com/entities/27863" target="_blank" data-smartkarma-citation="entities:27863:1">Leong Hup International (LEHUP MK)</a> is one of the largest producers of poultry, eggs and livestock feeds in Southeast Asia. It has launched a downsized IPO to raise gross proceeds of RM275 million ($67 million). The IPO would be the biggest in Malaysia since <a href="https://www.smartkarma.com/entities/24159" target="_blank" data-smartkarma-citation="entities:24159:1">Lotte Chemical Titan Holding (TTNP MK)</a> listed in July 2017.<div class="content-highlight">In our <a href="https://www.smartkarma.com/insights/leong-hup-ipo-preview-a-game-of-chicken" target="_blank">IPO initiation note</a>, we noted that Leong Hup’s ability to command a premium rating of around 20x P/E faces challenges. In the event, Leong Hup has pared back its ambition and launched its IPO at a rating of 15x FY18 P/E, according to press reports. We believe Leong Hup’s fundamentals are mixed but would participate in the IPO due to the attractive valuation.</div>

Leong Hup International (LEHUP MK) is one of the largest producers of poultry, eggs and livestock feeds in Southeast Asia. It has launched a downsized IPO to raise gross proceeds of RM275 million ($67 million). The IPO would be the biggest in Malaysia since Lotte Chemical Titan Holding (TTNP MK) listed in July 2017.In our IPO initiation note, we noted that Leong Hup’s ability to command a premium rating of around 20x P/E faces challenges. In the event, Leong Hup has pared back its ambition and launched its IPO at a rating of 15x FY18 P/E, according to press reports. We believe Leong Hup’s fundamentals are mixed but would participate in the IPO due to the attractive valuation.

Leong Hup IPO: A Finger Licking Good Price

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In 1Q2019, Consumer Staples was the second-best performing sector with +13.9% total return, reversing the -2.9% total return in calendar year 2018. It was also amongst the top net buy sectors for the quarter, garnering total institutional inflows of S$61.5 million. 
	 </li>
	<li>
The 20 largest capitalised Consumer Staples stocks on SGX have a combined market cap of more than S$80 billion, and are well-diversified – both in terms of product range as well as geographical spread. The majority of these players report more than half their revenues to the Asia Pacific and/or global markets, excluding Singapore. 
	 </li>
	<li>Among the 20, the five best performers in the YTD were: Indofood Agri Resources (+46.6%), QAF Ltd (+44.4%), Thai Beverage PCL (+38.0%), Golden Agri-Resources (+20.4%), and First Resources (+19.5%). They averaged a YTD total return of +33.8%.</li>
</ul>
Second-Best Performing Sector in 1Q19

In the first quarter of 2019, Consumer Staples was the second-best performing sector on SGX with a total return of +13.9%, after Information Technology’s +28.6% total return. Consumer Staples’ strong performance in 1Q19 also reverses the -2.9% total return it generated in calendar year 2018.

Consumer Staples was also among the top net buy sectors for the January-March quarter, garnering total institutional inflows of S$61.5 million, according to SGX data. This comprised inflows of S$50.3 million, S$9.0 million, and S$2.2 million for January, February and March 2019 respectively.

Geographical Diversity

The 20 largest capitalised Consumer Staples stocks on SGX have a combined market cap of more than S$80 billion and are well-diversified – both in terms of product range as well as geographical spread. The majority of these players report more than half their revenues to the Asia Pacific and/or global markets, excluding Singapore.

In the 2019 year-to-date, these 20 largest Consumer Staples stocks have averaged a total return of +12.9%, bringing their one-year and three-year total returns to -1.4% and +22.6% respectively. They have also averaged a price-earnings ratio of 24.5x and a dividend indicated yield of 2.5%.

Among the 20, the five best performers in the YTD were: Indofood Agri Resources (+46.6%), QAF Ltd (+44.4%), Thai Beverage PCL (+38.0%), Golden Agri-Resources (+20.4%), and First Resources (+19.5%). They have averaged a YTD total return of +33.8%.

Note that earlier this month, Jakarta Stock Exchange-listed PT Indofood Sukses Makmur Tbk, controlled by Indonesian tycoon Anthoni Salim, offered S$0.28 per share to take Indofood Agri Resources private.

The table below details the 20 largest Consumer Staples stocks on SGX, sorted by YTD total return.

<table class="table table-striped"><tbody>
<tr>
<td>
			Name
			</td>
			<td>
			SGX Code
			</td>
			<td>
			Market Cap (S$M)
			</td>
			<td>
			Total Return YTD (%)
			</td>
			<td>
			Total Return 1Y (%)
			</td>
			<td>
			Total Return 3Y (%)
			</td>
			<td>
			P/E (x)
			</td>
			<td>
			Div Ind Yld (%)
			</td>
		</tr>
<tr>
<td>
			INDOFOOD AGRI RESOURCES*
			</td>
			<td>
			5JS
			</td>
			<td>
			391
			</td>
			<td>
			46.6
			</td>
			<td>
			-10.5
			</td>
			<td>
			-49.0
			</td>
			<td>
			NA
			</td>
			<td>
			2.5
			</td>
		</tr>
<tr>
<td>
			QAF LTD
			</td>
			<td>
			Q01
			</td>
			<td>
			492
			</td>
			<td>
			44.4
			</td>
			<td>
			-14.4
			</td>
			<td>
			-9.3
			</td>
			<td>
			59.5
			</td>
			<td>
			5.9
			</td>
		</tr>
<tr>
<td>
			THAI BEVERAGE PCL
			</td>
			<td>
			Y92
			</td>
			<td>
			20,719
			</td>
			<td>
			38.0
			</td>
			<td>
			6.1
			</td>
			<td>
			27.9
			</td>
			<td>
			21.2
			</td>
			<td>
			2.0
			</td>
		</tr>
<tr>
<td>
			GOLDEN AGRI-RESOURCES
			</td>
			<td>
			E5H
			</td>
			<td>
			3,757
			</td>
			<td>
			20.4
			</td>
			<td>
			-15.4
			</td>
			<td>
			-26.9
			</td>
			<td>
			NA
			</td>
			<td>
			2.0
			</td>
		</tr>
<tr>
<td>
			FIRST RESOURCES
			</td>
			<td>
			EB5
			</td>
			<td>
			2,931
			</td>
			<td>
			19.5
			</td>
			<td>
			15.5
			</td>
			<td>
			0.8
			</td>
			<td>
			17.9
			</td>
			<td>
			1.9
			</td>
		</tr>
<tr>
<td>
			WILMAR INTL
			</td>
			<td>
			F34
			</td>
			<td>
			23,034
			</td>
			<td>
			17.3
			</td>
			<td>
			17.8
			</td>
			<td>
			11.1
			</td>
			<td>
			14.8
			</td>
			<td>
			2.9
			</td>
		</tr>
<tr>
<td>
			BUMITAMA AGRI
			</td>
			<td>
			P8Z
			</td>
			<td>
			1,251
			</td>
			<td>
			16.9
			</td>
			<td>
			4.8
			</td>
			<td>
			-6.8
			</td>
			<td>
			12.0
			</td>
			<td>
			3.8
			</td>
		</tr>
<tr>
<td>
			OLAM INTL
			</td>
			<td>
			O32
			</td>
			<td>
			6,094
			</td>
			<td>
			15.8
			</td>
			<td>
			-13.7
			</td>
			<td>
			22.7
			</td>
			<td>
			21.0
			</td>
			<td>
			3.9
			</td>
		</tr>
<tr>
<td>
			YEO HIAP SENG
			</td>
			<td>
			Y03
			</td>
			<td>
			568
			</td>
			<td>
			12.0
			</td>
			<td>
			-11.7
			</td>
			<td>
			-22.1
			</td>
			<td>
			47.3
			</td>
			<td>
			2.0
			</td>
		</tr>
<tr>
<td>
			MEWAH INTL
			</td>
			<td>
			MV4
			</td>
			<td>
			420
			</td>
			<td>
			10.0
			</td>
			<td>
			-4.7
			</td>
			<td>
			2.3
			</td>
			<td>
			20.6
			</td>
			<td>
			2.4
			</td>
		</tr>
<tr>
<td>
			DEL MONTE PACIFIC
			</td>
			<td>
			D03
			</td>
			<td>
			276
			</td>
			<td>
			8.8
			</td>
			<td>
			-39.6
			</td>
			<td>
			-54.0
			</td>
			<td>
			11.9
			</td>
			<td>
			NA
			</td>
		</tr>
<tr>
<td>
			FOOD EMPIRE HOLDINGS
			</td>
			<td>
			F03
			</td>
			<td>
			291
			</td>
			<td>
			6.7
			</td>
			<td>
			-15.1
			</td>
			<td>
			126.4
			</td>
			<td>
			12.2
			</td>
			<td>
			1.2
			</td>
		</tr>
<tr>
<td>
			JB FOODS
			</td>
			<td>
			BEW
			</td>
			<td>
			188
			</td>
			<td>
			4.8
			</td>
			<td>
			13.7
			</td>
			<td>
			224.7
			</td>
			<td>
			5.1
			</td>
			<td>
			3.3
			</td>
		</tr>
<tr>
<td>
			OLD CHANG KEE
			</td>
			<td>
			5ML
			</td>
			<td>
			96
			</td>
			<td>
			4.6
			</td>
			<td>
			8.8
			</td>
			<td>
			41.0
			</td>
			<td>
			18.6
			</td>
			<td>
			3.8
			</td>
		</tr>
<tr>
<td>
			DELFI LTD
			</td>
			<td>
			P34
			</td>
			<td>
			856
			</td>
			<td>
			4.5
			</td>
			<td>
			-6.3
			</td>
			<td>
			-41.6
			</td>
			<td>
			29.8
			</td>
			<td>
			1.6
			</td>
		</tr>
<tr>
<td>
			BREADTALK GROUP
			</td>
			<td>
			CTN
			</td>
			<td>
			476
			</td>
			<td>
			3.7
			</td>
			<td>
			-10.1
			</td>
			<td>
			79.3
			</td>
			<td>
			39.2
			</td>
			<td>
			1.8
			</td>
		</tr>
<tr>
<td>
			FRASER &amp; NEAVE
			</td>
			<td>
			F99
			</td>
			<td>
			4,131
			</td>
			<td>
			3.6
			</td>
			<td>
			-2.1
			</td>
			<td>
			64.3
			</td>
			<td>
			19.9
			</td>
			<td>
			2.5
			</td>
		</tr>
<tr>
<td>
			SHENG SIONG GROUP
			</td>
			<td>
			OV8
			</td>
			<td>
			1,579
			</td>
			<td>
			-1.9
			</td>
			<td>
			5.3
			</td>
			<td>
			32.9
			</td>
			<td>
			22.1
			</td>
			<td>
			3.3
			</td>
		</tr>
<tr>
<td>
			JAPFA LTD
			</td>
			<td>
			UD2
			</td>
			<td>
			1,287
			</td>
			<td>
			-5.5
			</td>
			<td>
			43.8
			</td>
			<td>
			2.6
			</td>
			<td>
			8.9
			</td>
			<td>
			0.7
			</td>
		</tr>
<tr>
<td>
			DAIRY FARM INTL
			</td>
			<td>
			D01
			</td>
			<td>
			14,320
			</td>
			<td>
			-11.4
			</td>
			<td>
			-0.5
			</td>
			<td>
			26.1
			</td>
			<td>
			116.3
			</td>
			<td>
			2.7
			</td>
		</tr>
<tr>
<td>
			Average
			</td>
			<td>
			 
			</td>
			<td>
			 
			</td>
			<td>
			12.9
			</td>
			<td>
			-1.4
			</td>
			<td>
			22.6
			</td>
			<td>
			24.9
			</td>
			<td>
			2.5
			</td>
		</tr>
</tbody></table>
Source: Bloomberg &amp; StockFacts (data as of 22 April 2019)

*privatisation offer announced by parent

SGX lists more than 140 consumer stocks with a combined market capitalisation of over S$135 billion. More than 40 of these belong to the Consumer Staples sector, while the remainder are classified under the Consumer Discretionary segment. The retail and distribution of packaged foods and meats, production of agricultural goods, as well as beverage producers like soft drink makers and breweries, fall under the Consumer Staples sector.

Defensive Nature

Given the backdrop of slower global growth and increased macro risks, analysts have recommended investors to focus on sectors with robust balance sheets, stable earnings and decent valuations. In a <a href="https://api2.sgx.com/sites/default/files/2019-04/SG_Consumer_Sector%20Update_20190405_RHB.pdf">report</a> published earlier this month, RHB Research maintained its overweight rating on the Consumer space, pointing to “pockets of opportunities” in companies with strong attributes. “We continue to favour players with market exposure to the region that are likely to benefit from stronger GDP growth and higher domestic consumption,” the brokerage added.

Earlier this month, the International Monetary Fund (IMF) cut its global growth outlook to the lowest rate since the Global Financial Crisis, forecasting 3.3% growth in 2019, down from a 3.5% projection made in January. In its latest World Economic Outlook <a href="https://www.imf.org/en/Publications/WEO/Issues/2019/03/28/world-economic-outlook-april-2019">report</a>, the agency cited downside risks from ongoing global trade tensions, as well as a slowdown in several major economies, including the Eurozone, Latin America, the US and the UK.
</body></html>





In 1Q2019, Consumer Staples was the second-best performing sector with +13.9% total return, reversing the -2.9% total return in calendar year 2018. It was also amongst the top net buy sectors for the quarter, garnering total institutional inflows of S$61.5 million. 
	 
	
The 20 largest capitalised Consumer Staples stocks on SGX have a combined market cap of more than S$80 billion, and are well-diversified – both in terms of product range as well as geographical spread. The majority of these players report more than half their revenues to the Asia Pacific and/or global markets, excluding Singapore.  
	 
	Among the 20, the five best performers in the YTD were: Indofood Agri Resources (+46.6%), QAF Ltd (+44.4%), Thai Beverage PCL (+38.0%), Golden Agri-Resources (+20.4%), and First Resources (+19.5%). They averaged a YTD total return of +33.8%.

Second-Best Performing Sector in 1Q19

In the first quarter of 2019, Consumer Staples was the second-best performing sector on SGX with a total return of +13.9%, after Information Technology’s +28.6% total return. Consumer Staples’ strong performance in 1Q19 also reverses the -2.9% total return it generated in calendar year 2018.

Consumer Staples was also among the top net buy sectors for the January-March quarter, garnering total institutional inflows of S$61.5 million, according to SGX data. This comprised inflows of S$50.3 million, S$9.0 million, and S$2.2 million for January, February and March 2019 respectively.

Geographical Diversity

The 20 largest capitalised Consumer Staples stocks on SGX have a combined market cap of more than S$80 billion and are well-diversified – both in terms of product range as well as geographical spread. The majority of these players report more than half their revenues to the Asia Pacific and/or global markets, excluding Singapore.

In the 2019 year-to-date, these 20 largest Consumer Staples stocks have averaged a total return of +12.9%, bringing their one-year and three-year total returns to -1.4% and +22.6% respectively. They have also averaged a price-earnings ratio of 24.5x and a dividend indicated yield of 2.5%.

Among the 20, the five best performers in the YTD were: Indofood Agri Resources (+46.6%), QAF Ltd (+44.4%), Thai Beverage PCL (+38.0%), Golden Agri-Resources (+20.4%), and First Resources (+19.5%). They have averaged a YTD total return of +33.8%.

Note that earlier this month, Jakarta Stock Exchange-listed PT Indofood Sukses Makmur Tbk, controlled by Indonesian tycoon Anthoni Salim, offered S$0.28 per share to take Indofood Agri Resources private.

The table below details the 20 largest Consumer Staples stocks on SGX, sorted by YTD total return.




			Name
			
			
			SGX Code
			
			
			Market Cap (S$M)
			
			
			Total Return YTD (%)
			
			
			Total Return 1Y (%)
			
			
			Total Return 3Y (%)
			
			
			P/E (x)
			
			
			Div Ind Yld (%)
			
		


			INDOFOOD AGRI RESOURCES*
			
			
			5JS
			
			
			391
			
			
			46.6
			
			
			-10.5
			
			
			-49.0
			
			
			NA
			
			
			2.5
			
		


			QAF LTD
			
			
			Q01
			
			
			492
			
			
			44.4
			
			
			-14.4
			
			
			-9.3
			
			
			59.5
			
			
			5.9
			
		


			THAI BEVERAGE PCL
			
			
			Y92
			
			
			20,719
			
			
			38.0
			
			
			6.1
			
			
			27.9
			
			
			21.2
			
			
			2.0
			
		


			GOLDEN AGRI-RESOURCES
			
			
			E5H
			
			
			3,757
			
			
			20.4
			
			
			-15.4
			
			
			-26.9
			
			
			NA
			
			
			2.0
			
		


			FIRST RESOURCES
			
			
			EB5
			
			
			2,931
			
			
			19.5
			
			
			15.5
			
			
			0.8
			
			
			17.9
			
			
			1.9
			
		


			WILMAR INTL
			
			
			F34
			
			
			23,034
			
			
			17.3
			
			
			17.8
			
			
			11.1
			
			
			14.8
			
			
			2.9
			
		


			BUMITAMA AGRI
			
			
			P8Z
			
			
			1,251
			
			
			16.9
			
			
			4.8
			
			
			-6.8
			
			
			12.0
			
			
			3.8
			
		


			OLAM INTL
			
			
			O32
			
			
			6,094
			
			
			15.8
			
			
			-13.7
			
			
			22.7
			
			
			21.0
			
			
			3.9
			
		


			YEO HIAP SENG
			
			
			Y03
			
			
			568
			
			
			12.0
			
			
			-11.7
			
			
			-22.1
			
			
			47.3
			
			
			2.0
			
		


			MEWAH INTL
			
			
			MV4
			
			
			420
			
			
			10.0
			
			
			-4.7
			
			
			2.3
			
			
			20.6
			
			
			2.4
			
		


			DEL MONTE PACIFIC
			
			
			D03
			
			
			276
			
			
			8.8
			
			
			-39.6
			
			
			-54.0
			
			
			11.9
			
			
			NA
			
		


			FOOD EMPIRE HOLDINGS
			
			
			F03
			
			
			291
			
			
			6.7
			
			
			-15.1
			
			
			126.4
			
			
			12.2
			
			
			1.2
			
		


			JB FOODS
			
			
			BEW
			
			
			188
			
			
			4.8
			
			
			13.7
			
			
			224.7
			
			
			5.1
			
			
			3.3
			
		


			OLD CHANG KEE
			
			
			5ML
			
			
			96
			
			
			4.6
			
			
			8.8
			
			
			41.0
			
			
			18.6
			
			
			3.8
			
		


			DELFI LTD
			
			
			P34
			
			
			856
			
			
			4.5
			
			
			-6.3
			
			
			-41.6
			
			
			29.8
			
			
			1.6
			
		


			BREADTALK GROUP
			
			
			CTN
			
			
			476
			
			
			3.7
			
			
			-10.1
			
			
			79.3
			
			
			39.2
			
			
			1.8
			
		


			FRASER &amp; NEAVE
			
			
			F99
			
			
			4,131
			
			
			3.6
			
			
			-2.1
			
			
			64.3
			
			
			19.9
			
			
			2.5
			
		


			SHENG SIONG GROUP
			
			
			OV8
			
			
			1,579
			
			
			-1.9
			
			
			5.3
			
			
			32.9
			
			
			22.1
			
			
			3.3
			
		


			JAPFA LTD
			
			
			UD2
			
			
			1,287
			
			
			-5.5
			
			
			43.8
			
			
			2.6
			
			
			8.9
			
			
			0.7
			
		


			DAIRY FARM INTL
			
			
			D01
			
			
			14,320
			
			
			-11.4
			
			
			-0.5
			
			
			26.1
			
			
			116.3
			
			
			2.7
			
		


			Average
			
			
			 
			
			
			 
			
			
			12.9
			
			
			-1.4
			
			
			22.6
			
			
			24.9
			
			
			2.5
			
		

Source: Bloomberg &amp; StockFacts (data as of 22 April 2019)

*privatisation offer announced by parent

SGX lists more than 140 consumer stocks with a combined market capitalisation of over S$135 billion. More than 40 of these belong to the Consumer Staples sector, while the remainder are classified under the Consumer Discretionary segment. The retail and distribution of packaged foods and meats, production of agricultural goods, as well as beverage producers like soft drink makers and breweries, fall under the Consumer Staples sector.

Defensive Nature

Given the backdrop of slower global growth and increased macro risks, analysts have recommended investors to focus on sectors with robust balance sheets, stable earnings and decent valuations. In a report published earlier this month, RHB Research maintained its overweight rating on the Consumer space, pointing to “pockets of opportunities” in companies with strong attributes. “We continue to favour players with market exposure to the region that are likely to benefit from stronger GDP growth and higher domestic consumption,” the brokerage added.

Earlier this month, the International Monetary Fund (IMF) cut its global growth outlook to the lowest rate since the Global Financial Crisis, forecasting 3.3% growth in 2019, down from a 3.5% projection made in January. In its latest World Economic Outlook report, the agency cited downside risks from ongoing global trade tensions, as well as a slowdown in several major economies, including the Eurozone, Latin America, the US and the UK.



Singapore’s Largest Consumer Staples Stocks Returned 34% in YTD

<a href="https://www.smartkarma.com/entities/27863" target="_blank" data-smartkarma-citation="entities:27863:1">Leong Hup International (LEHUP MK)</a> is one of the largest producers of poultry, eggs and livestock feeds in Southeast Asia. After an unusually quite 2018, Malaysia’s equity capital market is set for rebound with at least three issuers looking to raise up to $500 million from IPOs. Leong Hup is set to the be the first as it has started the search for cornerstone investors.
<div class="content-highlight">
Helped by the current imbalance between available Malaysian IPOs and the dry powder among investors, Leong Hup is seeking a premium rating. However, our analysis suggests the ability of Leong Hup to command a premium rating faces challenges.
</div>

Leong Hup International (LEHUP MK) is one of the largest producers of poultry, eggs and livestock feeds in Southeast Asia. After an unusually quite 2018, Malaysia’s equity capital market is set for rebound with at least three issuers looking to raise up to $500 million from IPOs. Leong Hup is set to the be the first as it has started the search for cornerstone investors.

Helped by the current imbalance between available Malaysian IPOs and the dry powder among investors, Leong Hup is seeking a premium rating. However, our analysis suggests the ability of Leong Hup to command a premium rating faces challenges.


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Five Best-Performing Small-Cap Consumer Stocks Avg 26% YTD Return

Singapore

Japfa Ltd. operates in the agricultural industry. The Company breeds and processes chicken, pork and beef. Japfa also operates dairy farms.

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Japfa Ltd (JAP SP)

Real Estate, Manufacturing and F&B Shares on the Move in 1H19

Real Estate, Manufacturing and Food & Beverage stocks made up close to half of Singapore’s top 200 stocks by turnover in the first 5 months...

Singapore Exchange Ltd (SGX)

Leong Hup IPO: A Finger Licking Good Price

Leong Hup International (LEHUP MK) is one of the largest producers of poultry, eggs and livestock feeds in Southeast Asia. It has launched a...

Arun George

Singapore’s Largest Consumer Staples Stocks Returned 34% in YTD

In 1Q2019, Consumer Staples was the second-best performing sector with +13.9% total return, reversing the -2.9% total return in calendar year...

Singapore Exchange Ltd (SGX)

Leong Hup IPO Preview: A Game of Chicken

Leong Hup International (LEHUP MK) is one of the largest producers of poultry, eggs and livestock feeds in Southeast Asia. After an unusually quite...

Arun George

Five Best-Performing Small-Cap Consumer Stocks Avg 26% YTD Return

Singapore Exchange Ltd (SGX)

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