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

Rex International Holding / Equity Bottom-Up

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Rex International Holding has generated an 18% YTD gain and maintains offshore oil and gas exploration and production in assets located in Oman and Norway, in addition to owning Rex Virtual Drilling. Since listing the Group has achieved four offshore discoveries that spans one in Oman and three in Norway. 
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Fortress Minerals has generated a 123% YTD price gain, with dividends boosting the total return 127%. The high-grade iron ore concentrate producer based in Malaysia, reported 181% YoY growth for its net profit after tax in FY21 (ended 28 Feb) attributed to continued increases of local crude steel production in 2021. 
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	<li>Southern Alliance Mining has generated a 211% YTD price gain. The Group reported 47% YoY net profit growth for its 1HFY21 (ended 31 Jan), and noted that Iron ore prices were expected to remain high, supported by the rising demand for steel from China and supply disruptions from Brazil.</li>
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The three most traded Energy and Iron Ore plays, listed on Catalist, are Rex International Holding, Fortress Minerals and Southern Alliance Mining. The three stocks have seen a combined average daily turnover of S$4.8 million a day in the 20202 year to 17 May. Moreover, the combined market capitalisation of the three stocks is close to S$1.2 billion. In the 2020 year to 17 May, Rex International Holding, Fortress Minerals and Southern Alliance Mining generated respective price gains of 17.8%, 123.3% and 211.1%.

 

Recent gains in commodity prices have been attributed to a number of economic factors, including structural re-pricing on last year’s decline in the US Dollar, increasing complex geopolitical tensions and a wave of nationalistic stockpiling, not to mention the prevalence of stimulus measures, while at the same time much of the world expecting a significant growth recovery. Given a large portion of commodities involve industrial processes upstream from consumer-facing businesses, their demand has been less impacted by the global social and economic lockdowns to contain COVID-19.  

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Since June 2020, the price of Brent Crude Oil has rallied from US$41/bbl to US$71 on 8 March, with futures markets continuing to be in backwardation. The IMF recently attributed the downward sloping futures curve to a temporary tight demand-supply balance expected this year—in line with International Energy Agency projections of a steady decline in oil inventories, with oil demand (supply) projected at 96.4 million barrels a day in 2021. Click <a href="https://www.imf.org/-/media/Files/Research/CommodityPrices/WEOSpecialFeature/CSFApril2021.ashx?force_isolation=true">here</a> for full report.</li>
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Iron ore prices have risen significantly since June 2020, rising to above US$230/t on 12 May, more than double its price in June 2020. China’s iron ore imports have also been upward trend since 2020. As noted by one of Singapore’s Catalist-listed Iron Ore plays, although the Chinese government is targeting to achieve 45% self-sufficiency by 2025, it will continue to rely on imports due to the scarcity of resources and high production costs because of very low grades of the iron ores. </li>
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 Southern Alliance Mining 
Southern Alliance Mining’s hsare price has gained 211.1% in the 2021 year to 17 May, closing the session at a share price of S$1.12. The Group is an established producer of high-grade iron ore products in Malaysia, and is listed on the Catalist of Singapore Exchange on 26 June, 2020. Headquartered in Pahang, Malaysia, the Group is principally involved in the exploration, mining and processing of iron ore for subsequent sale.

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On 13 March, the Group reported its revenue increased 7.8% year-on-year to RM152.1 million for 1HFY21 (ended 31 Jan), despite lower sales volume in all class of products sold. The revenue increase was mainly driven by an increase in the average realised selling price (“ARSP”)  of iron ore concentrate with iron ore concentrate sales volume decreasing by 6.8% or 21,900 dried metric ton (“DMT”), whereas ARSP increased by 44.3% to reach RM492.82 per DMT.</li>
	<li>The increase in revenue due to higher ARSP, partially offset by lower sales volume causing a decrease in cost of sales, elevated the group’s gross profit by 29.9% to reach RM72.3 million in 1HFY21 (ended 31 Jan). Consequently, the gross profit margin expanded by 8.1 percentage points to 47.6% for 1HFY21.
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Despite COVID-19 continuing to have a substantial impact on various economies in the world, the Group noted iron ore demand has accelerated on the back of tight supplies, rising steel production in China and an infrastructure-led economic recovery.</li>
	<li>The Group will continue with its planned drilling programs, focusing on exploration activities at Chaah and Ma’okil mines in 2HFY21. Click <a href="https://links.sgx.com/1.0.0/corporate-announcements/MLTKO0J3K78TWRWO/9a08acfebf49a7a8221fdf4bc43b35871c499cb95c944e45893450742c36ea82">here</a> for more.</li>
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Fortress Minerals 
Fortress Minerals, a high-grade iron ore concentrate producer based in Malaysia, has seen its share price rally 123.3% in the 2021 year to 17 May, to 67 cents. The Group is principally in the business of exploration, mining, production and sale of iron ore concentrates. The Group presently produces magnetite high grade iron ore concentrates mined from the East, Valley and West Deposits in its Bukit Besi Mine in Malaysia, and sells its iron ore concentrates primarily to steel mills in Malaysia and trading companies in China.

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<li>For its FY21, the Group reported its revenue increased 84.1% year-on-year to US$47.7 million as the Group continued to grow production output with record volume sold of 452,756 DMT and higher average realised selling price of iron ore concentrate to US$105.43/DMT.</li>
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The Group’s net profit after income tax increased 180.8% yoy to US$18.2 million, exceeding FY20 by US$11.7 million. The Group is principally in the business of exploration, mining, production and sale of iron ore concentrates. Click <a href="https://links.sgx.com/1.0.0/corporate-announcements/F61QAQHYCHC0SJAW/a7ad5c025d3f2e43a465ab17224386204222b8045a475be6b9bccf6f6720be72">here</a> for more.</li>
	<li>The Group presently produces magnetite iron ore concentrates with TFe grade of 65.0% and above, mined from the East, Valley and West Deposits in its Bukit Besi Mine, and sells its iron ore concentrates primarily to steel mills and trading companies in Malaysia.</li>
	<li>Click <a href="https://www.sgx.com/research-education/market-dialogues/20210115-fortress-minerals-rides-iron-ore-uptrend">here</a> for the kopi-C report  <a href="https://www.sgx.com/research-education/market-dialogues/20210115-fortress-minerals-rides-iron-ore-uptrend">Fortress Minerals Rides Iron Ore Uptrend</a></li>
	<li>Click <a href="https://api2.sgx.com/sites/default/files/market-dialogues/migration/10%20in%2010%20with%20Fortress%20Minerals%20-%20Malaysia%E2%80%99s%20Leading%20High-Grade%20Iron%20Ore%20Play%20%288Dec2020%29_0.pdf">here</a> for <a href="https://api2.sgx.com/sites/default/files/market-dialogues/migration/10%20in%2010%20with%20Fortress%20Minerals%20-%20Malaysia%E2%80%99s%20Leading%20High-Grade%20Iron%20Ore%20Play%20%288Dec2020%29_0.pdf">10 in 10 with Fortress Minerals - Malaysia's Leading High-Grade Iron Ore Play</a></li>
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Rex International Holding 
Rex International Holding (“Rex”) has generated a 17.8% price gain in the 2021 year through to 17 May, closing the 17 May session at 17.2 cents per share. Since Rex International was listed on Catalist in July 2013, the Group has achieved four offshore discoveries that spans one in Oman and three in Norway. The Group also offers Rex Virtual Drilling screening services to other oil exploration companies as an additional tool to increase the success rate of finding oil. The share price of Rex was subject to significant volatility in its first two years of listing, and following the IPO price of 50 cents per share, traded at a low of 4 cents per share in August 2018. 
 

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For its FY20 (ended 31 Dec), the Group recorded revenue of US$46.66 million, compared to US$0.14 million revenue generated by the Group for FY19, mainly due to oil sales in Oman starting from April 2020. Rex recorded total loss after tax of US$15.90 million in FY20, as compared to total profit after tax of US$22.23 million in FY19, due to high start-up production costs, low initial realised oil prices during the six-month period ended 30 June 2020 and depletion of oil and gas properties.</li>
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In a monthly update on 4 May, Rex announced its 86.4% subsidiary, Masirah Oil Limited, achieved gross oil production in April 2021 from the Yumna Field in offshore Block 50 Oman, amounting to 12,210 stock tank barrels per day (stb/d).</li>
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In January, the 90% owned subsidiary Lime Petroleum AS was awarded participating interests in four new offshore licences, including one with discovery for development, in the 2020 Awards in Predefined Areas round in Norway. These new awards brought to total, interests in 13 licences in Lime Petroleum AS portfolio, including three discoveries – Shrek, Apollonia and Falk/Linerle – with potential for development. For the FY20 Annual Report click <a href="https://links.sgx.com/1.0.0/corporate-announcements/FDBRJOVNS6VGK2D9/d26d09efb2aa36de551182f73de18ca13a6a684dd5aff87eacf4c15c84258392">here</a>.</li>
	<li>Click <a href="https://api2.sgx.com/sites/default/files/market-dialogues/migration/10%20in%2010%20with%20Rex%20International%20-%20Oiled%20Up%20%286Apr2021%29.pdf">here</a> for <a href="https://api2.sgx.com/sites/default/files/market-dialogues/migration/10%20in%2010%20with%20Rex%20International%20-%20Oiled%20Up%20%286Apr2021%29.pdf">10 in 10 with Rex International - Oiled Up</a>.</li>
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Rex International Holding has generated an 18% YTD gain and maintains offshore oil and gas exploration and production in assets located in Oman and Norway, in addition to owning Rex Virtual Drilling. Since listing the Group has achieved four offshore discoveries that spans one in Oman and three in Norway. 
	 
	
Fortress Minerals has generated a 123% YTD price gain, with dividends boosting the total return 127%. The high-grade iron ore concentrate producer based in Malaysia, reported 181% YoY growth for its net profit after tax in FY21 (ended 28 Feb) attributed to continued increases of local crude steel production in 2021.  
	 
	Southern Alliance Mining has generated a 211% YTD price gain. The Group reported 47% YoY net profit growth for its 1HFY21 (ended 31 Jan), and noted that Iron ore prices were expected to remain high, supported by the rising demand for steel from China and supply disruptions from Brazil.

 

The three most traded Energy and Iron Ore plays, listed on Catalist, are Rex International Holding, Fortress Minerals and Southern Alliance Mining. The three stocks have seen a combined average daily turnover of S$4.8 million a day in the 20202 year to 17 May. Moreover, the combined market capitalisation of the three stocks is close to S$1.2 billion. In the 2020 year to 17 May, Rex International Holding, Fortress Minerals and Southern Alliance Mining generated respective price gains of 17.8%, 123.3% and 211.1%.

 

Recent gains in commodity prices have been attributed to a number of economic factors, including structural re-pricing on last year’s decline in the US Dollar, increasing complex geopolitical tensions and a wave of nationalistic stockpiling, not to mention the prevalence of stimulus measures, while at the same time much of the world expecting a significant growth recovery. Given a large portion of commodities involve industrial processes upstream from consumer-facing businesses, their demand has been less impacted by the global social and economic lockdowns to contain COVID-19.  



Since June 2020, the price of Brent Crude Oil has rallied from US$41/bbl to US$71 on 8 March, with futures markets continuing to be in backwardation. The IMF recently attributed the downward sloping futures curve to a temporary tight demand-supply balance expected this year—in line with International Energy Agency projections of a steady decline in oil inventories, with oil demand (supply) projected at 96.4 million barrels a day in 2021. Click here for full report.
	
Iron ore prices have risen significantly since June 2020, rising to above US$230/t on 12 May, more than double its price in June 2020. China’s iron ore imports have also been upward trend since 2020. As noted by one of Singapore’s Catalist-listed Iron Ore plays, although the Chinese government is targeting to achieve 45% self-sufficiency by 2025, it will continue to rely on imports due to the scarcity of resources and high production costs because of very low grades of the iron ores. 

 Southern Alliance Mining   
Southern Alliance Mining’s hsare price has gained 211.1% in the 2021 year to 17 May, closing the session at a share price of S$1.12. The Group is an established producer of high-grade iron ore products in Malaysia, and is listed on the Catalist of Singapore Exchange on 26 June, 2020. Headquartered in Pahang, Malaysia, the Group is principally involved in the exploration, mining and processing of iron ore for subsequent sale.



On 13 March, the Group reported its revenue increased 7.8% year-on-year to RM152.1 million for 1HFY21 (ended 31 Jan), despite lower sales volume in all class of products sold. The revenue increase was mainly driven by an increase in the average realised selling price (“ARSP”)  of iron ore concentrate with iron ore concentrate sales volume decreasing by 6.8% or 21,900 dried metric ton (“DMT”), whereas ARSP increased by 44.3% to reach RM492.82 per DMT.
	The increase in revenue due to higher ARSP, partially offset by lower sales volume causing a decrease in cost of sales, elevated the group’s gross profit by 29.9% to reach RM72.3 million in 1HFY21 (ended 31 Jan). Consequently, the gross profit margin expanded by 8.1 percentage points to 47.6% for 1HFY21.

	
Despite COVID-19 continuing to have a substantial impact on various economies in the world, the Group noted iron ore demand has accelerated on the back of tight supplies, rising steel production in China and an infrastructure-led economic recovery.
	The Group will continue with its planned drilling programs, focusing on exploration activities at Chaah and Ma’okil mines in 2HFY21. Click here for more.

 

Fortress Minerals   
Fortress Minerals, a high-grade iron ore concentrate producer based in Malaysia, has seen its share price rally 123.3% in the 2021 year to 17 May, to 67 cents. The Group is principally in the business of exploration, mining, production and sale of iron ore concentrates. The Group presently produces magnetite high grade iron ore concentrates mined from the East, Valley and West Deposits in its Bukit Besi Mine in Malaysia, and sells its iron ore concentrates primarily to steel mills in Malaysia and trading companies in China.


For its FY21, the Group reported its revenue increased 84.1% year-on-year to US$47.7 million as the Group continued to grow production output with record volume sold of 452,756 DMT and higher average realised selling price of iron ore concentrate to US$105.43/DMT.
	
The Group’s net profit after income tax increased 180.8% yoy to US$18.2 million, exceeding FY20 by US$11.7 million. The Group is principally in the business of exploration, mining, production and sale of iron ore concentrates. Click here for more.
	The Group presently produces magnetite iron ore concentrates with TFe grade of 65.0% and above, mined from the East, Valley and West Deposits in its Bukit Besi Mine, and sells its iron ore concentrates primarily to steel mills and trading companies in Malaysia.
	Click here for the kopi-C report  Fortress Minerals Rides Iron Ore Uptrend
	Click here for 10 in 10 with Fortress Minerals - Malaysia's Leading High-Grade Iron Ore Play

 

Rex International Holding   
Rex International Holding (“Rex”) has generated a 17.8% price gain in the 2021 year through to 17 May, closing the 17 May session at 17.2 cents per share. Since Rex International was listed on Catalist in July 2013, the Group has achieved four offshore discoveries that spans one in Oman and three in Norway. The Group also offers Rex Virtual Drilling screening services to other oil exploration companies as an additional tool to increase the success rate of finding oil. The share price of Rex was subject to significant volatility in its first two years of listing, and following the IPO price of 50 cents per share, traded at a low of 4 cents per share in August 2018. 
 



For its FY20 (ended 31 Dec), the Group recorded revenue of US$46.66 million, compared to US$0.14 million revenue generated by the Group for FY19, mainly due to oil sales in Oman starting from April 2020. Rex recorded total loss after tax of US$15.90 million in FY20, as compared to total profit after tax of US$22.23 million in FY19, due to high start-up production costs, low initial realised oil prices during the six-month period ended 30 June 2020 and depletion of oil and gas properties.
	
In a monthly update on 4 May, Rex announced its 86.4% subsidiary, Masirah Oil Limited, achieved gross oil production in April 2021 from the Yumna Field in offshore Block 50 Oman, amounting to 12,210 stock tank barrels per day (stb/d).
	
In January, the 90% owned subsidiary Lime Petroleum AS was awarded participating interests in four new offshore licences, including one with discovery for development, in the 2020 Awards in Predefined Areas round in Norway. These new awards brought to total, interests in 13 licences in Lime Petroleum AS portfolio, including three discoveries – Shrek, Apollonia and Falk/Linerle – with potential for development. For the FY20 Annual Report click here.
	Click here for 10 in 10 with Rex International - Oiled Up.




Top Traded Catalist Energy & Iron Ore Plays Ride Commodity Trends