In Singapore, the Straits Times Index (STI) was up about 17 points, or about 0.5%, to end the week at 3229.48 points. This took the STI’s gain to 12.0% for the year at the halftime mark in 2017.
The local market also welcomed Malaysia’s Shopper360’s Initial Public Offering (IPO) on Friday (30 June 2017). The counter ended marginally higher at $0.295, than its IPO price at $0.290. Another IPO, NetLinkNBN Trust, is expected to be listed in July. At an expected market capitalisation of $3.1 to $3.6 billion, it will be the biggest IPO in Singapore since Hutchison Port Holdings Trust.
Globally, markets similarly did not move significantly during the week. In Hong Kong and the US, the Hang Seng Index (HSI) and the S&P 500, ended down 0.4% and 0.5% respectively. The Morgan Stanley Capital International (MSCI) All Country World Index (AWCI), an index made up of 23 developed markets and 23 emerging markets worldwide, was similarly marginally down for the week.
STI Reserve List
The STI reserve list is made up of five stocks that will replace any STI constituents, the top 30 stocks in Singapore, that become ineligible to be within the list.
This list is made up of three real estate investment trusts, Suntec REIT, Mapletree Commercial Trust, Keppel REIT and Sembcorp Marine and Yanlord Land.
Suntec REIT (SGX: T82U)
At a market capitalisation of close to $5.0 billion, Suntec owns high quality properties in Singapore and Australia which maintains a portfolio occupancy rate of over 98%.
In Singapore’s prime business districts, it has a 60.8% interest in Suntec, a one-third interest in One Raffles Quay, a one-third interest in Marina Bay Financial Centre Towers 1, 2 and the Marina Bay Link Mall as well as a 30.0% interest in 9 Penang Road. In Sydney, Australia, it holds a 100% stake in 177 Pacific Highway, an office development as well as a 25.0% interest in Southgate Complex, an integrated development in Melbourne.
In the past week, its share price has increased by close to 1.1% to $1.87. This brings its return in the first six months of 2017 to 13.3%. At its current share price, it also delivers an annualised distribution yield of 5.6%.
Mapletree Commercial Trust (SGX: N2IU)
Mapletree Commercial Trust, or MCT, has a market capitalisation of $4.6 billion, and owns prime properties in Singapore which has a portfolio occupancy rate of 98%. Its stable of high quality properties here include VivoCity, PSA Building, Mapletree Anson, Mapletree Business City 1 and Merrill Lynch HabourFront.
In the past week, its share price has increased by 2.2%, and in the first half of 2017, it has delivered a return of 14.3%. At its current share price, the REIT also yields 5.4% through its quarterly distributions.
Sembcorp Marine Ltd (SGX: S51)
Sembcorp Marine has a market capitalisation of over $3.5 billion. Over the past few years, it has been embattled due to the weak oil and gas market which has seen oil prices plummet. With oil prices seeing slightly improved support in 2017, rising to close to US$50, there could be more interest in companies in this industry.
Sembcorp Marine was actually part of the top 30 stocks in Singapore until the end of 2016, when it was dropped. It has recently been included back into the reserve list to take over any companies that may drop out in the future.
In the past week, its share price has improved by 2.5%, bringing its first half returns to 19.2%. In FY2016, it delivered a dividend of 2.5 Singapore cents. At its current share price, it will offer a yield of 1.5%.
Yanlord Land Group Limited (SGX: Z25)
Yanlord was recently included in the STI reserve list – on 19 June 2017. With a market capitalisation of $3.4 billion, it is based in China and develops high-end residential, commercial and integrated property projects in high-growth cities in China.
The company has an established presence in five major economic regions in China, namely the Yangtze River Delta, Pearl River Delta, Wester China, Bohia Rim and Hainan International Tourist Island. Its operations has increased over 2.5 times in the past five years – bringing its revenue to RMB 25.7 billion and profit for the year to RMB 4.0 billion in FY2016.
In the past week, its share price fell 1.4%. This only made a small dent in its 33.0% return in the first half of 2017. Yanlord also offers a dividend yield of nearly 1%.
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