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

<p><em><strong>Non- SGX Report: These equity research reports are not written by the SGX.</strong>&nbsp;SGX supports the distribution of the research reports by external contributors. Please refer to the Disclaimer in the attached report.</em></p>
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<h2>Halcyon Agri Corporation Limited</h2>
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<h3>Riding on rubber demand</h3>
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<p><strong>Halcyon Agri Corporation Limited is involved in the production, processing and distribution of various natural rubber grades.</strong> Through its wholly-owned subsidiaries HRC and CMC, the Group owns a total of 4 plantations, 38 processing plants, and distribution centers across key geographical areas. Sales to tyre makers makes up around 70% of total revenue.</p>
<p><strong>Rubber consumption is on the rise.</strong> Recovery in global mobility of people and goods, economic development, and rise of sharing economy are putting more cars on the road. About 70% of world rubber consumption goes into the tyre industry of which ~75% are for tyre replacement.</p>
<p><strong>Future supplies are curtailed as low rubber prices in the past few years dissuade planting investment and maintenance.</strong> Other factors such as fungal disease and extreme weather conditions pose immediate threat to current and future rubber yield. Increased consumption and tighter supply will underpin rubber price.</p>
<p><strong>Adoption of HeveaConnect platform among industry players</strong> (i.e rubber producers, tyre makers) to gain ground as they seek for more transparent and sustainability-focused rubber trades. SGX holds a 9.1% stake in HC. HC charges a fee for every mT of rubber traded on the digital platform.</p>
<p><strong>ASP and raw material cost trends in line with rubber prices.</strong> The Group sourced a substantial majority (c.95%) of its feedstock from independent smallholders, therefore cost of raw materials follows rubber prices closely. Extreme weather conditions which affect supplies could further erode purchasers’ margin. In the near term, resurgence of Omicron variant could see rubber prices falling. In the long term, rubber prices could be supported by a tightening supply.</p>
<p><strong>Key risks:</strong> Variant resurgence, volatility in rubber prices and foreign currency risk as purchases from smallholders are paid in their local currencies while sale proceeds are mainly received in USD.</p>
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Non- SGX Report: These equity research reports are not written by the SGX.&nbsp;SGX supports the distribution of the research reports by external contributors. Please refer to the Disclaimer in the attached report.




Halcyon Agri Corporation Limited




Riding on rubber demand




Halcyon Agri Corporation Limited is involved in the production, processing and distribution of various natural rubber grades. Through its wholly-owned subsidiaries HRC and CMC, the Group owns a total of 4 plantations, 38 processing plants, and distribution centers across key geographical areas. Sales to tyre makers makes up around 70% of total revenue.
Rubber consumption is on the rise. Recovery in global mobility of people and goods, economic development, and rise of sharing economy are putting more cars on the road. About 70% of world rubber consumption goes into the tyre industry of which ~75% are for tyre replacement.
Future supplies are curtailed as low rubber prices in the past few years dissuade planting investment and maintenance. Other factors such as fungal disease and extreme weather conditions pose immediate threat to current and future rubber yield. Increased consumption and tighter supply will underpin rubber price.
Adoption of HeveaConnect platform among industry players (i.e rubber producers, tyre makers) to gain ground as they seek for more transparent and sustainability-focused rubber trades. SGX holds a 9.1% stake in HC. HC charges a fee for every mT of rubber traded on the digital platform.
ASP and raw material cost trends in line with rubber prices. The Group sourced a substantial majority (c.95%) of its feedstock from independent smallholders, therefore cost of raw materials follows rubber prices closely. Extreme weather conditions which affect supplies could further erode purchasers’ margin. In the near term, resurgence of Omicron variant could see rubber prices falling. In the long term, rubber prices could be supported by a tightening supply.
Key risks: Variant resurgence, volatility in rubber prices and foreign currency risk as purchases from smallholders are paid in their local currencies while sale proceeds are mainly received in USD.













(Non-SGX Report) Halcyon Agri Corporation Limited - Riding on Rubber Demand