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

Yangzijiang Shipbuilding / Equity Bottom-Up

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<li>
Singapore’s five most traded Industrial Stocks are all STI stocks and have made up 10% of the day-to-day combined turnover of all stocks listed in Singapore in the 2020 YTD and span transportation, conglomerate and shipbuilding companies. 
	 </li>
	<li>
Since the STI formed its 9 June high, through to 15 September, the most defensive of the five Industrial stocks was Yangzijiang Shipbuilding Holdings which declined 3.4% while the STI declined 9.5%. Yangzijiang was also recipient to S$21 million in net institutional inflow over the period. 
	 </li>
	<li>Yangzijiang reported a 34% YoY decline in 1HFY20 net profit attributable to shareholders (with a 17% YoY decline in 2QFY20). Despite temporary shutdowns in Feb to early March and challenging market conditions, the Group's new order wins of US$517 million for 1HFY20 was more than double that of 1HFY19.  </li>
</ul>
 

Singapore’s five most traded Industrial Stocks are all stocks of the Straits Times Index and have made up 10% of the day-to-day combined turnover of all stocks listed on Singapore Exchange in the 2020 year through to 15 September.  The five companies (sort by the most actively traded) are Singapore Airlines, ComfortDelGro Corporation, Jardine Matheson Holdings, Keppel Corporation And Yangzijiang Shipbuilding Holdings. All five have recently reported earnings, with results and outlooks of the companies detailed below. Singapore Airlines

<ul>
<li>SIA reported a net loss of S$1.1 billion for the fiscal first quarter ended 30 June 2020, compared with a net profit of S$111 million in the year-ago period</li>
	<li>1Q Group revenue declined 79.3% YoY to S$851 million; revenues were dominated by cargo contributions on the back of strong demand for airfreight</li>
	<li>Passenger carriage sank by 99.4% for SIA, 99.8% for SilkAir and 99.9% for Scoot, resulting in a 99.5% decline for the Group</li>
	<li>The recovery trajectory in international air travel is slower than initially expected
	<ul>
<li>Industry experts, including IATA and ICAO, expect that it will take between two to four years for passenger traffic numbers to return to pre-pandemic levels</li>
	</ul>
</li>
	<li>Our current view is that, by the end of FY20/21, the Group’s passenger capacity may reach less than half of its pre-COVID-19 levels</li>
	<li>We are reviewing the potential shape and size of our network over the longer term given COVID-19 and its impact on our passenger traffic and revenue, which will provide better clarity on the fleet size and mix the Group will need
	<ul>
<li>This review – expected to be completed by half-year – is likely to lead to a material impairment of the carrying values of older generation aircraft, particularly the A380 aircraft, which would account for approx $1 billion</li>
	</ul>
</li>
	<li>Global airfreight capacity is anticipated to remain constrained in the near term due to significantly lower bellyhold cargo capacity worldwide, which may help to sustain the current cargo load factors
	<ul>
<li>With progressive reopening of economies and as manufacturing resumes, there is likely to be a gradual pickup in general cargo demand even as urgent movement of medical supplies recede</li>
		<li>We will continue to optimise the usage of our freighters to capture demand opportunities and supplement our cargo capacity through the deployment of cargo-only passenger flights when justified</li>
	</ul>
</li>
	<li>The Group continues to pursue cost management measures and will explore additional means to shore up liquidity as necessary
	<ul>
<li>Fresh liquidity from the recent rights issue will boost our financial position to tackle COVID-19 challenges</li>
	</ul>
</li>
</ul>
 Click <a href="https://links.sgx.com/1.0.0/corporate-announcements/6B16X1096MX5ZAC5/625476_bu-q1fy2021.pdf">here</a> for full business update.

 

ComfortDelGro Corporation

<ul>
<li>Revenue for the first six months ended 30 June 2020 fell 20.8% YoY to S$1.53 billion, battered by the global shutdown brought on by COVID-19</li>
	<li>The Group reported a half-year loss of S$6.0 million, compared to a net profit of $146.3 million in the previous period; without government reliefs totalling S$60.1 million, the Group would have recorded a net loss of S$66.1 million</li>
	<li>The full economic impact of COVID-19 is still unfolding, the scale and duration of which remains uncertain</li>
	<li>Governments have provided significant temporary relief for the near-term but the sustainability of such reliefs is uncertain</li>
	<li>The future global economy post-COVID-19 will be different, arising from socio-economic factors such as work from home arrangements and changes to supply chain management</li>
	<li>With the challenging outlook, revenues are expected to remain depressed and margins under pressure</li>
	<li>The Group is monitoring the situation and adapting to changing circumstances by ensuring its service levels are maintained while refining its internal cost structures and operational efficiencies</li>
	<li>Notwithstanding the current uncertainties, with a strong balance sheet the Group remains committed to its long-term mobility strategy and continues to transform and build its capabilities, while looking for growth opportunities in overseas markets</li>
</ul>
 Click <a href="https://links.sgx.com/1.0.0/corporate-announcements/OPCJPYPDHXO2GNLE/627824_COMFORTDELGRO%20-%20Media%20Release-CDG%20Results%20for%20Q2FY2020.pdf">here</a> for full results release.

 

Jardine Matheson Holdings

<ul>
<li>For the six months ended 30 June 2020, Jardine Matheson reported underlying profit of US$373 million, down 49% YoY</li>
	<li>Revenue was 21% lower at US$15.9 billion, while revenue, including 100% of associates and joint ventures, fell 11% to US$44.9 billion</li>
	<li>The Group’s performance and profitability in 1H2020 were significantly impacted by COVID-19 and the restrictions imposed to contain it</li>
	<li>Greater China was mainly affected in 1Q, while Southeast Asia felt the impact of the pandemic increasingly in 2Q</li>
	<li>The Group’s balance sheet and funding position remain strong – as at 30 June 2020, it had liquidity of US$13.9 billion, consisting of US$7.6 billion in cash reserves and US$6.3 billion in unused, committed debt facilities</li>
	<li>The pandemic continues to create uncertainty and volatility and trading conditions in 2H are expected to continue to be challenging</li>
	<li>While there were some signs of recovery in certain of the Group’s businesses in 2Q, the possibility of further waves of the pandemic make it difficult to predict performance in 2H</li>
	<li>The Group is focused both on driving operational performance across its businesses, and on identifying and taking the potential opportunities which are emerging from the pandemic to drive future growth</li>
</ul>
 Click <a href="https://links.sgx.com/1.0.0/corporate-announcements/NGPW617YW0XH30TZ/625723_JMH.pdf">here</a> for full results release.

 

Keppel Corporation

<ul>
<li>Keppel Corp reported a net loss of S$537 million for the half year ended 30 June 2020, compared to a net profit of S$356 million for 1H 2019, after S$930 million of impairments mainly related to Keppel Offshore &amp; Marine’s (Keppel O&amp;M) stranded assets, receivables, stocks and share of impairment provisions from Floatel</li>
	<li>Excluding impairments, the Group would have registered net profit of S$393 million for 1H 2020, 5% higher YoY</li>
	<li>The Group’s 1H2020 revenue of S$3.2 billion was slightly lower compared to the S$3.3 billion achieved in 1H2019</li>
	<li>Lower contributions from property trading projects in China, power and gas sales, environmental engineering projects and asset management were partially offset by higher revenues from O&amp;M projects and the consolidation of M1 from March 2019</li>
	<li>Against this challenging backdrop, further rightsizing will be required at Keppel O&amp;M to ensure that its fixed overhead costs can be brought down in line with the realities for the industry
	<ul>
<li>To this end, the CEO and management of Keppel O&amp;M have volunteered to take a base salary reduction of between 5% and 10% as a demonstration of collective resolve and to set the tone from the top</li>
		<li>In solidarity with Keppel O&amp;M, the senior executive management of Keppel Corp will also take a base salary reduction of between 5% and 10%, while the directors of Keppel Corp and Keppel O&amp;M will take a 10% reduction in their annual fees</li>
	</ul>
</li>
</ul>
 Click <a href="https://links.sgx.com/1.0.0/corporate-announcements/ZDNE80O3L950DWSO/625697_1.%20KCL%202Q2020%20-%20Financial%20Statements.pdf">here</a> for full results release.

 

Yangzijiang Shipbuilding

<ul>
<li>Total revenue fell 32% YoY to RMB4.8 billion for the second quarter ended 30 June 2020, primarily due to the lower revenue from trading business</li>
	<li>Core shipbuilding revenue of RMB3.0 billion for 2Q was comparable to the year-ago quarter's RMB3.1 billion, with gross margin improving from 18% to 22%</li>
	<li>Net profit attributable to shareholders for 2Q 2020 was RMB774 million, down 17% YoY</li>
	<li>Since April 2020, the Group’s operations have resumed full capacity, and it has fully made up for lost time due to the temporary shutdown in February to early March</li>
	<li>Vessel deliveries were on schedule, including several New Panamax dry bulkers completed and delivered by YAMIC
	<ul>
<li>In July 2020, the Group delivered a 12,600TEU containership, the largest containership ever built in its history</li>
	</ul>
</li>
	<li>COVID-19 has weighed on the price of new vessels and charter rates, and further dampened ship-owners’ sentiment and the outlook for the shipbuilding industry</li>
	<li>Global new shipbuilding orders for 1H2020 has declined to the lowest level since 1996 to 5.7 million CGT
	<ul>
<li>Outstanding order book to fleet ratio also decreased further to 7.8% at the end of June 2020 compared to 9.4% at the beginning of 2020</li>
	</ul>
</li>
	<li>Despite the challenging market conditions, the Group’s new order wins of US$517 million for 1H2020 was more than double that of 1H2019
	<ul>
<li>These new orders for the 15 vessels included two 14,000TEU dual-fuel containerships and two 690FEU LNG-tank carriers</li>
		<li>As at 30 June 2020, the Group had an outstanding order book of US$2.6 billion for 62 vessels, and was ranked No. 2 in China and No. 7 in the world by outstanding orderbook</li>
		<li>These orders will keep the Group’s yard facilities at a healthy utilisation rate till early 2022 and provide a stable revenue stream for at least the next 1.5 years</li>
	</ul>
</li>
</ul>
 Click <a href="https://links.sgx.com/1.0.0/corporate-announcements/7ZM2D0CQWVKWLWP1/626403_Announcement_2Q2020_FINAL.pdf">here</a> for full results release.
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Singapore’s five most traded Industrial Stocks are all STI stocks and have made up 10% of the day-to-day combined turnover of all stocks listed in Singapore in the 2020 YTD and span transportation, conglomerate and shipbuilding companies. 
	 
	
Since the STI formed its 9 June high, through to 15 September, the most defensive of the five Industrial stocks was Yangzijiang Shipbuilding Holdings which declined 3.4% while the STI declined 9.5%. Yangzijiang was also recipient to S$21 million in net institutional inflow over the period. 
	 
	Yangzijiang reported a 34% YoY decline in 1HFY20 net profit attributable to shareholders (with a 17% YoY decline in 2QFY20). Despite temporary shutdowns in Feb to early March and challenging market conditions, the Group's new order wins of US$517 million for 1HFY20 was more than double that of 1HFY19.  

 

Singapore’s five most traded Industrial Stocks are all stocks of the Straits Times Index and have made up 10% of the day-to-day combined turnover of all stocks listed on Singapore Exchange in the 2020 year through to 15 September.  The five companies (sort by the most actively traded) are Singapore Airlines, ComfortDelGro Corporation, Jardine Matheson Holdings, Keppel Corporation And Yangzijiang Shipbuilding Holdings. All five have recently reported earnings, with results and outlooks of the companies detailed below.  Singapore Airlines


SIA reported a net loss of S$1.1 billion for the fiscal first quarter ended 30 June 2020, compared with a net profit of S$111 million in the year-ago period
	1Q Group revenue declined 79.3% YoY to S$851 million; revenues were dominated by cargo contributions on the back of strong demand for airfreight
	Passenger carriage sank by 99.4% for SIA, 99.8% for SilkAir and 99.9% for Scoot, resulting in a 99.5% decline for the Group
	The recovery trajectory in international air travel is slower than initially expected
	
Industry experts, including IATA and ICAO, expect that it will take between two to four years for passenger traffic numbers to return to pre-pandemic levels
	

	Our current view is that, by the end of FY20/21, the Group’s passenger capacity may reach less than half of its pre-COVID-19 levels
	We are reviewing the potential shape and size of our network over the longer term given COVID-19 and its impact on our passenger traffic and revenue, which will provide better clarity on the fleet size and mix the Group will need
	
This review – expected to be completed by half-year – is likely to lead to a material impairment of the carrying values of older generation aircraft, particularly the A380 aircraft, which would account for approx $1 billion
	

	Global airfreight capacity is anticipated to remain constrained in the near term due to significantly lower bellyhold cargo capacity worldwide, which may help to sustain the current cargo load factors
	
With progressive reopening of economies and as manufacturing resumes, there is likely to be a gradual pickup in general cargo demand even as urgent movement of medical supplies recede
		We will continue to optimise the usage of our freighters to capture demand opportunities and supplement our cargo capacity through the deployment of cargo-only passenger flights when justified
	

	The Group continues to pursue cost management measures and will explore additional means to shore up liquidity as necessary
	
Fresh liquidity from the recent rights issue will boost our financial position to tackle COVID-19 challenges
	


 Click here for full business update.

 

ComfortDelGro Corporation


Revenue for the first six months ended 30 June 2020 fell 20.8% YoY to S$1.53 billion, battered by the global shutdown brought on by COVID-19
	The Group reported a half-year loss of S$6.0 million, compared to a net profit of $146.3 million in the previous period; without government reliefs totalling S$60.1 million, the Group would have recorded a net loss of S$66.1 million
	The full economic impact of COVID-19 is still unfolding, the scale and duration of which remains uncertain
	Governments have provided significant temporary relief for the near-term but the sustainability of such reliefs is uncertain
	The future global economy post-COVID-19 will be different, arising from socio-economic factors such as work from home arrangements and changes to supply chain management
	With the challenging outlook, revenues are expected to remain depressed and margins under pressure
	The Group is monitoring the situation and adapting to changing circumstances by ensuring its service levels are maintained while refining its internal cost structures and operational efficiencies
	Notwithstanding the current uncertainties, with a strong balance sheet the Group remains committed to its long-term mobility strategy and continues to transform and build its capabilities, while looking for growth opportunities in overseas markets

 Click here for full results release.

 

Jardine Matheson Holdings


For the six months ended 30 June 2020, Jardine Matheson reported underlying profit of US$373 million, down 49% YoY
	Revenue was 21% lower at US$15.9 billion, while revenue, including 100% of associates and joint ventures, fell 11% to US$44.9 billion
	The Group’s performance and profitability in 1H2020 were significantly impacted by COVID-19 and the restrictions imposed to contain it
	Greater China was mainly affected in 1Q, while Southeast Asia felt the impact of the pandemic increasingly in 2Q
	The Group’s balance sheet and funding position remain strong – as at 30 June 2020, it had liquidity of US$13.9 billion, consisting of US$7.6 billion in cash reserves and US$6.3 billion in unused, committed debt facilities
	The pandemic continues to create uncertainty and volatility and trading conditions in 2H are expected to continue to be challenging
	While there were some signs of recovery in certain of the Group’s businesses in 2Q, the possibility of further waves of the pandemic make it difficult to predict performance in 2H
	The Group is focused both on driving operational performance across its businesses, and on identifying and taking the potential opportunities which are emerging from the pandemic to drive future growth

 Click here for full results release.

 

Keppel Corporation


Keppel Corp reported a net loss of S$537 million for the half year ended 30 June 2020, compared to a net profit of S$356 million for 1H 2019, after S$930 million of impairments mainly related to Keppel Offshore &amp; Marine’s (Keppel O&amp;M) stranded assets, receivables, stocks and share of impairment provisions from Floatel
	Excluding impairments, the Group would have registered net profit of S$393 million for 1H 2020, 5% higher YoY
	The Group’s 1H2020 revenue of S$3.2 billion was slightly lower compared to the S$3.3 billion achieved in 1H2019
	Lower contributions from property trading projects in China, power and gas sales, environmental engineering projects and asset management were partially offset by higher revenues from O&amp;M projects and the consolidation of M1 from March 2019
	Against this challenging backdrop, further rightsizing will be required at Keppel O&amp;M to ensure that its fixed overhead costs can be brought down in line with the realities for the industry
	
To this end, the CEO and management of Keppel O&amp;M have volunteered to take a base salary reduction of between 5% and 10% as a demonstration of collective resolve and to set the tone from the top
		In solidarity with Keppel O&amp;M, the senior executive management of Keppel Corp will also take a base salary reduction of between 5% and 10%, while the directors of Keppel Corp and Keppel O&amp;M will take a 10% reduction in their annual fees
	


 Click here for full results release.

 

Yangzijiang Shipbuilding


Total revenue fell 32% YoY to RMB4.8 billion for the second quarter ended 30 June 2020, primarily due to the lower revenue from trading business
	Core shipbuilding revenue of RMB3.0 billion for 2Q was comparable to the year-ago quarter's RMB3.1 billion, with gross margin improving from 18% to 22%
	Net profit attributable to shareholders for 2Q 2020 was RMB774 million, down 17% YoY
	Since April 2020, the Group’s operations have resumed full capacity, and it has fully made up for lost time due to the temporary shutdown in February to early March
	Vessel deliveries were on schedule, including several New Panamax dry bulkers completed and delivered by YAMIC
	
In July 2020, the Group delivered a 12,600TEU containership, the largest containership ever built in its history
	

	COVID-19 has weighed on the price of new vessels and charter rates, and further dampened ship-owners’ sentiment and the outlook for the shipbuilding industry
	Global new shipbuilding orders for 1H2020 has declined to the lowest level since 1996 to 5.7 million CGT
	
Outstanding order book to fleet ratio also decreased further to 7.8% at the end of June 2020 compared to 9.4% at the beginning of 2020
	

	Despite the challenging market conditions, the Group’s new order wins of US$517 million for 1H2020 was more than double that of 1H2019
	
These new orders for the 15 vessels included two 14,000TEU dual-fuel containerships and two 690FEU LNG-tank carriers
		As at 30 June 2020, the Group had an outstanding order book of US$2.6 billion for 62 vessels, and was ranked No. 2 in China and No. 7 in the world by outstanding orderbook
		These orders will keep the Group’s yard facilities at a healthy utilisation rate till early 2022 and provide a stable revenue stream for at least the next 1.5 years
	


 Click here for full results release.



Yangzijiang Most Defensive of SG’s Most Active Industrials Since 9 June 