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.

Equity Bottom-Up

<ul><li>REIT Watch - Outperformance in S-Reits in STI reserve list Post the June review, the STI reserve list, which consists of the 5 highest ranking non-constituents of the STI, were: Olam International, Suntec Reit, Keppel Reit, Frasers Centrepoint Trust and Mapletree North Asia Commercial Trust (MNACT).</li><li>Four out of the 5 stocks in the STI reserve list were in the S-Reits and Property Trusts sector.</li></ul>

REIT Watch - Outperformance in S-Reits in STI reserve list Post the June review, the STI reserve list, which consists of the 5 highest ranking non-constituents of the STI, were: Olam International, Suntec Reit, Keppel Reit, Frasers Centrepoint Trust and Mapletree North Asia Commercial Trust (MNACT).Four out of the 5 stocks in the STI reserve list were in the S-Reits and Property Trusts sector.

REIT Watch - Outperformance in S-Reits in STI reserve list

<ul><li>Following the broad downtrend that gripped global stocks in 1H22, most benchmarks have posted partial recoveries over the first seven weeks of 2H22.</li><li>However, the uneven global growth outlook has seen China stocks (as gauged by the FTSE China A50 Index) further decline by 10%, following the 6% decline in 1H22.</li><li>Growth, inflation, and the inflationary impact on growth has carried an uneven impact on global economic sectors and by extension sectors and industries in 1H22.</li></ul>

Following the broad downtrend that gripped global stocks in 1H22, most benchmarks have posted partial recoveries over the first seven weeks of 2H22.However, the uneven global growth outlook has seen China stocks (as gauged by the FTSE China A50 Index) further decline by 10%, following the 6% decline in 1H22.Growth, inflation, and the inflationary impact on growth has carried an uneven impact on global economic sectors and by extension sectors and industries in 1H22.

Recent Stockmarket Moves and Challenges Ahead

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>In June-July I warned of a reinvestment trade into S-REITs due to the S$2.0-3.0bn cash-out by investors in Mapletree North Asia Commercial Trust and sellers into the SPHREIT Chain Offer.</li>
<li>Many investors who would need to re-allocate. The trade was to buy major S-REITs. From my last insight, a basket is up 5.3%. MCT has already topped out vs peers.</li>
<li>The question is.... is there still a trade left to run?</li>
</ul>


In June-July I warned of a reinvestment trade into S-REITs due to the S$2.0-3.0bn cash-out by investors in Mapletree North Asia Commercial Trust and sellers into the SPHREIT Chain Offer.
Many investors who would need to re-allocate. The trade was to buy major S-REITs. From my last insight, a basket is up 5.3%. MCT has already topped out vs peers.
The question is.... is there still a trade left to run?


Mapletree Pan Asia Commercial Trust / Equity Bottom-Up

<ul><li>Last week, OCBC and DBS attracted a combined S$142M of net insti inflow, with UOB seeing S$35M of net outflow.</li><li>Combined, Singapore-listed stocks attracted S$182M of net insti inflows last week, curbing net outflow in the 2022 YTD to S$48M.</li><li>A non-STI stock, Raffles Medical Group, saw the fifth highest net institutional inflows last week, while rallying 17% last week and reporting 1H22 group revenue of S$382 million, representing 11.2% YoY growth.</li></ul>

Last week, OCBC and DBS attracted a combined S$142M of net insti inflow, with UOB seeing S$35M of net outflow.Combined, Singapore-listed stocks attracted S$182M of net insti inflows last week, curbing net outflow in the 2022 YTD to S$48M.A non-STI stock, Raffles Medical Group, saw the fifth highest net institutional inflows last week, while rallying 17% last week and reporting 1H22 group revenue of S$382 million, representing 11.2% YoY growth.

Last Week’s Institutional Rotation into Banks & REITs

Research from SooChow CSSD Capital Markets (Asia), SCCM Asia Research

SCCM Asia Research

Research from SooChow CSSD Capital Markets (Asia)

Headquartered in Singapore, SooChow CSSD Capital Markets (Asia) is an investment bank focusing on emerging growth companies across Asia, providing a full suite of investment banking services, including corporate finance, mergers and acquisitions advisory, equity capital markets, institutional equities sales and trading and equities research.

SooChow CSSD Capital Markets (Asia)

Thematic (Sector/Industry)

<ul><li><a href="https://www.smartkarma.com/entities/mapletree-commercial-trust" target="_blank" data-smartkarma-citation="entities:106" rel="noopener">Mapletree Commercial Trust (MCT SP)</a> 1Q23 Business Updates – VivoCity rebounded strongly, Office assets remained steady</li><li><a href="https://www.smartkarma.com/entities/ascendas-india-trust" target="_blank" data-smartkarma-citation="entities:935" rel="noopener">Ascendas India Trust (AIT SP)</a> 1H22 DPU +2.0% YoY; Strong recovery in occupancy as park population rose</li><li><a href="https://www.smartkarma.com/entities/first-real-estate-investment-trust" target="_blank" data-smartkarma-citation="entities:15848" rel="noopener">First REIT (FIRT SP) </a>2Q22 DPU +1.5% YoY; Boosted by recent acquisition of Japan nursing homes</li></ul>

Mapletree Commercial Trust (MCT SP) 1Q23 Business Updates – VivoCity rebounded strongly, Office assets remained steadyAscendas India Trust (AIT SP) 1H22 DPU +2.0% YoY; Strong recovery in occupancy as park population roseFirst REIT (FIRT SP) 2Q22 DPU +1.5% YoY; Boosted by recent acquisition of Japan nursing homes

ASEAN Builder's Scoop (1Aug22) - MCT Strong Metrics from VivoCity

Singapore

Mapletree Industrial Trust is a Singapore-focused real estate investment trust with a large and diversified portfolio of industrial properties. The Trust invests in a diverse portfolio of industrial properties with the primary objective of achieving an attractive level of return from rental income and for long-term capital growth.

Mapletree Logistics Trust is an Asia-focused logistics real estate investment trust. The Company invests in a diversified portfolio of income-producing real estate which is used for logistics purposes.

Frasers Centrepoint Trust is a retail real estate investment trust focused on growing unitholder value through asset management, financial management and strategic investments.  The trust invests in retail properties in Singapore and overseas.

FLT offers investors an opportunity to invest in logistics and industrial real estate assets strategically located within major logistics and industrial markets of Australia, Germany and the Netherlands.

Frasers Logistics & Commercial Trust (FLT SP)

Keppel DC REIT is Asia's first pure-play data centre REIT listed on the Singapore Exchange. Keppel DC REIT's investment strategy is to principally invest, directly or indirectly, in a diversified portfolio of income-producing real estate assets which are used primarily for data centre purposes, as well as real estate related assets.

Suntec Real Estate Investment Trust is a commercial real estate investment trust. The Trust invests in income-producing real estate that is primarily used for retail and/or office purposes.

Keppel REIT operates as a commercial real estate investment trust. The Trust owns and invests in a portfolio of income-producing office buildings and related real estate assets. Keppel REIT offers its services in Asia and Australia.

SPH REIT is a Singapore-based REIT established principally to invest, directly or indirectly, in a portfolio of income-producing real estate which is used primarily for retail purposes in Asia-Pacific, as well as real estate-related assets.

ESR-LOGOS Real Estate Investment Trust (“ESR-LOGOS REIT”) is a leading New Economy and future-ready Asia Pacific S-REIT. Listed on the Singapore Exchange Securities Trading Limited since 25 July 2006, ESR-LOGOS REIT invests in quality income-producing industrial properties in key gateway markets.

As at 28 April 2022, ESR-LOGOS REIT holds interests in a diversified portfolio of logistics properties, high-specifications industrial properties, business parks and general industrial properties with total assets of approximately S$5.5 billion. Its portfolio comprises 84 properties located across the developed markets of Singapore (63 assets) and Australia (21 assets), with a total gross floor area of approximately 2.4 million sqm, as well as investments in three property funds in Australia. ESR-LOGOS REIT is also a constituent of the FTSE EPRA Nareit Global Real Estate Index. 

ESR-LOGOS REIT is managed by ESR-LOGOS Funds Management (S) Limited (the “Manager”) and sponsored by the ESR Group (“ESR”). The Manager is owned by ESR (67.3%), Shanghai Summit Pte. Ltd. (25.0%), and Mitsui & Co., Ltd (7.7%), respectively.

For further information on ESR-LOGOS REIT, please visit www.esr-logosreit.com.sg.

Parkway Life Real Estate Investment Trust (Parkway Life REIT) invests primarily in income producing real estate and real estate related assets in the Asia Pacific region. The trust's real estate is used primarily for healthcare and healthcare-related purposes.

GPT Group is an active owner and manager of a diversified portfolio of Australian retail, office and industrial property assets. The Group's property portfolio include the MLC Centre, Australia Square, Rouse Hill Town Centre and Melbourne Central.

Vicinity Centres retails asset and property management services. The Company offers a retail property investment and services organization involved in the ownership, management, and development of retail properties. The Company operates shopping centers across Australia.

Dexus provides real estate services. The Company manages and invests in a portfolio of diversified properties, including office and industrial buildings, retail shopping centers, and car parks. Dexus serves customers in Australia and New Zealand.

Japan Metropolitan Fund Investment Corporation operates real estate investment trust. The Company provides securitized real estate investment, real estate leasing, shopping centers investment, and other services. Japan Metropolitan Fund Investment provides its services throughout Japan.

Japan Metropolitan Fund Investment Corporation (8953 JP)

Japan Metropolitan Fund Investment Corporation

Ryman Hospitality Properties, Inc. is a real estate investment trust specializing in group-oriented, destination hotel assets in urban and resort markets.

Sabra Health Care REIT, Inc. is a real estate investment trust.  The trust owns nursing homes, rehabilitation centers, assisted living facilities, and independent living centers.

Nippon Building Fund Inc. is a real estate investment trust (REIT) which mainly invests in real estate and securitized real estate products. Properties are mainly Business offices and are located in Tokyo Major 5 wards and Kanto area.

Independence Realty Trust, Inc. is an externally managed and advised apartment REIT focused on acquiring and owning well-located garden-style and mid-rise apartment properties throughout the United States.

Kite Realty Group Trust is a full-service, vertically integrated real estate company focused primarily on the development, construction, acquisition, ownership and operation of neighborhood and community shopping centers.  The company own properties in Indiana, Florida, Texas, Washington, Oregon, New Jersey, Illinois and Georgia.

Charter Hall Group invests in and develops real estate.  The Company manages real estate investment funds and develops commercial, residential, and industrial properties.

Mapletree Pan Asia Commercial Trust is a Singapore-focused real estate investment trust. The Trust invests on a long-term basis, directly or indirectly, in a diversified portfolio of income-producing real estate used primarily for office and/or retail purposes, whether wholly or partially, as well as real estate-related assets.

Mapletree Pan Asia Commercial Trust (MCT SP)

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Mapletree Pan Asia Commercial Trust (MCT SP)

REIT Watch - Outperformance in S-Reits in STI reserve list

REIT Watch - Outperformance in S-Reits in STI reserve list Post the June review, the STI reserve list, which consists of the 5 highest ranking...

Singapore Exchange Ltd (SGX)

Recent Stockmarket Moves and Challenges Ahead

Following the broad downtrend that gripped global stocks in 1H22, most benchmarks have posted partial recoveries over the first seven weeks of...

Singapore Exchange Ltd (SGX)

Update on the S-REIT Re-Allocation Trade

The S-REIT Re-Allocation Basket is +5.3%(TR) from close after I wrote (25 July) to yesterday. Not enough excess value has traded. Should it run?...

Travis Lundy

Last Week’s Institutional Rotation into Banks & REITs

Last week, OCBC and DBS attracted a combined S$142M of net insti inflow, with UOB seeing S$35M of net outflow. Combined, Singapore-listed stocks...

Singapore Exchange Ltd (SGX)

ASEAN Builder's Scoop (1Aug22) - MCT Strong Metrics from VivoCity

AIT rising park population drove occupancy higher; FIRT boosted by acquisitions; EREIT divests Pandan Log Hub; Suburban malls' rents to outperform...

SCCM Asia Research

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