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.

Asia’s leading multi-asset exchange

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

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Equity Bottom-Up

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In Dec 2019, Technology was among the top net buy sectors on SGX, garnering net institutional inflows of S$30.4 million – its fourth consecutive month of net inflow. It was also the second-best performing sector, generating a total return of 5.3% in Dec. 
	 </li>
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SGX lists at least 16 IT plays with market cap of more than S$100 million. Over 2019, these 15 tech companies and one business trust averaged a total return of 42.3%, bringing their 1Y total return to 33.2%. 
	 </li>
	<li>Over calendar year 2019, the five best performers among the 16 were: AEM (+154.3%), Frencken (+127.7%), Hi-P (+101.2%), UMS (+89.9%) and CSE Global (+53.3%). They averaged a total return of 105.3% in the past year.</li>
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 The Technology (Hardware/Software) sector was among the top net buy sectors on SGX in Dec 2019, garnering net institutional inflows of S$30.4 million. This was the fourth-highest inflow after Financial Services, Real Estate (ex-REITs) and Telecommunications. It was also the sector’s fourth consecutive month of net inflows.
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<figure>
 <img src='https://api2.sgx.com/sites/default/files/2020-01/Insti%20Inflows%20for%20Tech%20Stocks.PNG' alt='Institutional Inflows for Technology Sector ' />
 </figure>
 <div class='content-caption'>Institutional Inflows for Technology Sector </div>
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<html><body>In December 2019, Technology was also the second-best performing sector with a total return of 5.3%, after the Energy/Oil &amp; Gas sector’s 10.5% return. For the 12-month 2019 period, the Tech sector was the best performer, generating a total return of 39.4%.</body></html>

<figure>
 <img src='https://api2.sgx.com/sites/default/files/2020-01/Dec%20Total%20Returns.PNG' alt='Dec Total Returns' />
 </figure>
 <div class='content-caption'>Dec Total Return</div>
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SGX lists at least 16 Information Technology plays with market capitalisation of more than S$100 million each. These 15 companies and one business trust – with a combined market cap of about S$15 billion – run operations that span electronics contract manufacturing, precision engineering, plastic injection moulding, semiconductors, printed circuit boards, fibre broadband infrastructure, as well as software services and solutions.

Over 2019, these 16 tech plays with market cap above S$100 million averaged a total return of 42.3%, bringing their one-year total return to 33.2%.

The five best performers among them were: AEM Holdings (+154.3%), Frencken Group (+127.7%), Hi-P International (+101.2%), UMS Holdings (+89.9%) and CSE Global (+53.3%). They averaged a total return of 105.3% over the 2019 calendar year, bringing their 1Y total return to 88.7%.

The table below details the 16 technology plays with market cap above S$100 million on SGX, sorted by 2019 total return.

<table class="table table-striped"><tbody>
<tr>
<td>
			Name
			</td>
			<td>
			SGX Code
			</td>
			<td>
			Market Cap (S$)
			</td>
			<td>
			Total Return 2019 (%)
			</td>
			<td>
			Total Return 1Y (%)
			</td>
		</tr>
<tr>
<td>
			AEM HLDGS
			</td>
			<td>
			AWX
			</td>
			<td>
			553,644,352
			</td>
			<td>
			154.3
			</td>
			<td>
			131.4
			</td>
		</tr>
<tr>
<td>
			FRENCKEN GROUP
			</td>
			<td>
			E28
			</td>
			<td>
			386,542,880
			</td>
			<td>
			127.7
			</td>
			<td>
			124.0
			</td>
		</tr>
<tr>
<td>
			HI-P INTL LTD
			</td>
			<td>
			H17
			</td>
			<td>
			1,151,814,528
			</td>
			<td>
			101.2
			</td>
			<td>
			84.9
			</td>
		</tr>
<tr>
<td>
			UMS HLDGS
			</td>
			<td>
			558
			</td>
			<td>
			525,701,344
			</td>
			<td>
			89.9
			</td>
			<td>
			68.8
			</td>
		</tr>
<tr>
<td>
			CSE GLOBAL LTD
			</td>
			<td>
			544
			</td>
			<td>
			276,832,928
			</td>
			<td>
			53.3
			</td>
			<td>
			34.3
			</td>
		</tr>
<tr>
<td>
			ELEC &amp; ELTEK
			</td>
			<td>
			E16
			</td>
			<td>
			429,426,176
			</td>
			<td>
			33.5
			</td>
			<td>
			27.0
			</td>
		</tr>
<tr>
<td>
			VALUETRONICS LTD
			</td>
			<td>
			BN2
			</td>
			<td>
			334,950,656
			</td>
			<td>
			32.6
			</td>
			<td>
			20.8
			</td>
		</tr>
<tr>
<td>
			NETLINK NBN TRUST
			</td>
			<td>
			CJLU
			</td>
			<td>
			3,858,001,408
			</td>
			<td>
			30.5
			</td>
			<td>
			35.9
			</td>
		</tr>
<tr>
<td>
			VENTURE CORP
			</td>
			<td>
			V03
			</td>
			<td>
			4,732,081,664
			</td>
			<td>
			21.3
			</td>
			<td>
			12.9
			</td>
		</tr>
<tr>
<td>
			MICRO-MECHANICS
			</td>
			<td>
			5DD
			</td>
			<td>
			262,770,256
			</td>
			<td>
			16.6
			</td>
			<td>
			18.4
			</td>
		</tr>
<tr>
<td>
			CHUAN HUP HLDGS
			</td>
			<td>
			C33
			</td>
			<td>
			213,502,752
			</td>
			<td>
			14.9
			</td>
			<td>
			-1.3
			</td>
		</tr>
<tr>
<td>
			INNOTEK LTD
			</td>
			<td>
			M14
			</td>
			<td>
			105,250,496
			</td>
			<td>
			12.7
			</td>
			<td>
			15.3
			</td>
		</tr>
<tr>
<td>
			GP INDUSTRIES
			</td>
			<td>
			G20
			</td>
			<td>
			290,428,000
			</td>
			<td>
			3.5
			</td>
			<td>
			8.8
			</td>
		</tr>
<tr>
<td>
			SILVERLAKE AXIS
			</td>
			<td>
			5CP
			</td>
			<td>
			1,023,486,656
			</td>
			<td>
			2.6
			</td>
			<td>
			1.3
			</td>
		</tr>
<tr>
<td>
			SUNNINGDALE TECH
			</td>
			<td>
			BHQ
			</td>
			<td>
			247,605,312
			</td>
			<td>
			-1.9
			</td>
			<td>
			-8.1
			</td>
		</tr>
<tr>
<td>
			CREATIVE TECH
			</td>
			<td>
			C76
			</td>
			<td>
			228,940,656
			</td>
			<td>
			-16.4
			</td>
			<td>
			-43.3
			</td>
		</tr>
<tr>
<td>
			Average
			</td>
			<td>
			 
			</td>
			<td>
			 
			</td>
			<td>
			42.3
			</td>
			<td>
			33.2
			</td>
		</tr>
</tbody></table>
 Source: Bloomberg &amp; StockFacts (data as of 23 Jan 2020)

Nascent Signs of Recovery 
Singapore's <a href="https://www.edb.gov.sg/content/edb/en/news-and-events/news/monthly-manufacturing-performance.html">industrial production</a> declined 0.7% year-on-year in December, improving from November's revised figure of an 8.9% fall. Electronics output increased a modest 0.2% in December, led by a 42.6% gain in data storage, while the semiconductors segment saw 1% growth, recovering from November's 25.6% plunge, suggesting that the sector may be starting to bottom out. Output from the precision engineering segment also rose 7% last month, led by a 19.1% expansion in precision modules and components.

However, December <a href="https://www.enterprisesg.gov.sg/-/media/esg/files/media-centre/media-releases/2020/january/monthly-trade-report---dec-2019.pdf">exports</a> from the electronics sector remained mired in a downturn, plunging 21.3% YoY, compared with a 23.3% slide in November. The government said in November it expected Singapore’s exports to pick up this year, with non-oil domestic exports forecast to grow in the range of 0% to 2% on the back of a gradual recovery in the electronics sector.

Most economists expect new demand for 5G components, as well as broader usage of new technologies such as Internet of Things (IoT) and artificial intelligence (AI), could offer a boost to electronics manufacturers in the coming quarters.
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In Dec 2019, Technology was among the top net buy sectors on SGX, garnering net institutional inflows of S$30.4 million – its fourth consecutive month of net inflow. It was also the second-best performing sector, generating a total return of 5.3% in Dec. 
	 
	
SGX lists at least 16 IT plays with market cap of more than S$100 million. Over 2019, these 15 tech companies and one business trust averaged a total return of 42.3%, bringing their 1Y total return to 33.2%.  
	 
	Over calendar year 2019, the five best performers among the 16 were: AEM (+154.3%), Frencken (+127.7%), Hi-P (+101.2%), UMS (+89.9%) and CSE Global (+53.3%). They averaged a total return of 105.3% in the past year.

 The Technology (Hardware/Software) sector was among the top net buy sectors on SGX in Dec 2019, garnering net institutional inflows of S$30.4 million. This was the fourth-highest inflow after Financial Services, Real Estate (ex-REITs) and Telecommunications. It was also the sector’s fourth consecutive month of net inflows.



      
    
    Institutional Inflows for Technology Sector 

In December 2019, Technology was also the second-best performing sector with a total return of 5.3%, after the Energy/Oil &amp; Gas sector’s 10.5% return. For the 12-month 2019 period, the Tech sector was the best performer, generating a total return of 39.4%.


      
    
    Dec Total Return


SGX lists at least 16 Information Technology plays with market capitalisation of more than S$100 million each. These 15 companies and one business trust – with a combined market cap of about S$15 billion – run operations that span electronics contract manufacturing, precision engineering, plastic injection moulding, semiconductors, printed circuit boards, fibre broadband infrastructure, as well as software services and solutions.

Over 2019, these 16 tech plays with market cap above S$100 million averaged a total return of 42.3%, bringing their one-year total return to 33.2%.

The five best performers among them were: AEM Holdings (+154.3%), Frencken Group (+127.7%), Hi-P International (+101.2%), UMS Holdings (+89.9%) and CSE Global (+53.3%). They averaged a total return of 105.3% over the 2019 calendar year, bringing their 1Y total return to 88.7%.

The table below details the 16 technology plays with market cap above S$100 million on SGX, sorted by 2019 total return.




			Name
			
			
			SGX Code
			
			
			Market Cap (S$)
			
			
			Total Return 2019 (%)
			
			
			Total Return 1Y (%)
			
		


			AEM HLDGS
			
			
			AWX
			
			
			553,644,352
			
			
			154.3
			
			
			131.4
			
		


			FRENCKEN GROUP
			
			
			E28
			
			
			386,542,880
			
			
			127.7
			
			
			124.0
			
		


			HI-P INTL LTD
			
			
			H17
			
			
			1,151,814,528
			
			
			101.2
			
			
			84.9
			
		


			UMS HLDGS
			
			
			558
			
			
			525,701,344
			
			
			89.9
			
			
			68.8
			
		


			CSE GLOBAL LTD
			
			
			544
			
			
			276,832,928
			
			
			53.3
			
			
			34.3
			
		


			ELEC &amp; ELTEK
			
			
			E16
			
			
			429,426,176
			
			
			33.5
			
			
			27.0
			
		


			VALUETRONICS LTD
			
			
			BN2
			
			
			334,950,656
			
			
			32.6
			
			
			20.8
			
		


			NETLINK NBN TRUST
			
			
			CJLU
			
			
			3,858,001,408
			
			
			30.5
			
			
			35.9
			
		


			VENTURE CORP
			
			
			V03
			
			
			4,732,081,664
			
			
			21.3
			
			
			12.9
			
		


			MICRO-MECHANICS
			
			
			5DD
			
			
			262,770,256
			
			
			16.6
			
			
			18.4
			
		


			CHUAN HUP HLDGS
			
			
			C33
			
			
			213,502,752
			
			
			14.9
			
			
			-1.3
			
		


			INNOTEK LTD
			
			
			M14
			
			
			105,250,496
			
			
			12.7
			
			
			15.3
			
		


			GP INDUSTRIES
			
			
			G20
			
			
			290,428,000
			
			
			3.5
			
			
			8.8
			
		


			SILVERLAKE AXIS
			
			
			5CP
			
			
			1,023,486,656
			
			
			2.6
			
			
			1.3
			
		


			SUNNINGDALE TECH
			
			
			BHQ
			
			
			247,605,312
			
			
			-1.9
			
			
			-8.1
			
		


			CREATIVE TECH
			
			
			C76
			
			
			228,940,656
			
			
			-16.4
			
			
			-43.3
			
		


			Average
			
			
			 
			
			
			 
			
			
			42.3
			
			
			33.2
			
		

 Source: Bloomberg &amp; StockFacts (data as of 23 Jan 2020)

Nascent Signs of Recovery 
Singapore's industrial production declined 0.7% year-on-year in December, improving from November's revised figure of an 8.9% fall. Electronics output increased a modest 0.2% in December, led by a 42.6% gain in data storage, while the semiconductors segment saw 1% growth, recovering from November's 25.6% plunge, suggesting that the sector may be starting to bottom out. Output from the precision engineering segment also rose 7% last month, led by a 19.1% expansion in precision modules and components.

However, December exports from the electronics sector remained mired in a downturn, plunging 21.3% YoY, compared with a 23.3% slide in November. The government said in November it expected Singapore’s exports to pick up this year, with non-oil domestic exports forecast to grow in the range of 0% to 2% on the back of a gradual recovery in the electronics sector.

Most economists expect new demand for 5G components, as well as broader usage of new technologies such as Internet of Things (IoT) and artificial intelligence (AI), could offer a boost to electronics manufacturers in the coming quarters.



Five Best-Performing IT Stocks Returned 105% in 2019