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

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

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.

<!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd">
<html><body>
<ul>
<li>
The FTSE Value-Stocks ASEAN Index was amongst the strongest FTSE regional indices over the three years ending 2018. Its total return of 42% in USD terms outpaced 37 other regional indices published by FTSE Russell.   
	 </li>
	<li>
The 10 current SGX-listed stocks of the FTSE Value-Stocks ASEAN Index were in-line with the Index, averaging 42% total returns [in USD terms] over the three years, doubling the STI returns over the same period. The 10 stocks have also averaged 4% gains in the 2019 YTD. 
	 </li>
	<li>The Index is based on value investing principles and comprised of the largest capitalised stocks of the FTSE Global All Cap Index that meet value-investing screening criteria, namely Contrarian, Quality &amp; Valuation screenings, which are then ranked by lowest P/E Ratios.</li>
</ul>
Amid the region’s market moves of the past three years, the performances of several Asia Pacific indices have deviated by as much as 40%.

The strongest performers were cyclical Index stocks listed in Asia Pacific’s developed financial centres outside of Japan, ASEAN Value stocks and Asia Pacific ex-Japan Shariah stocks.  The least strongest Index performers over the past three years were the stocks making up an Asia Pacific Initial Public Offerings (“IPOs”) Index and Asia Pacific ex-Japan Small Cap stocks. This is based on the FTSE Asia Monthly Index Performance Report for Asia Pacific published earlier this month.

The FTSE Value-Stocks ASEAN Index consists of 50 quality value stocks amongst liquid and tradable ASEAN companies listed on the Indonesia Stock Exchange, Bursa Malaysia, the Philippine Stock Exchange,  Singapore Exchange (“SGX”) and the Stock Exchange of Thailand. As many as 10 of the 50 constituents are listed in Singapore. 
 

Singapore Constituents of the FTSE Value-Stocks ASEAN Index

The current SGX-listed stocks of the FTSE Value-Stocks ASEAN Index are Bukit Sembawang Estates, City Developments, DBS Group Holdings, Jardine Cycle &amp; Carriage, Mapletree Logistics Trust, Oversea-Chinese Banking Corp, Singapore Telecommunications, United Overseas Bank, UOL Group and Venture Corporation.

<ul>
<li>Of these current 10 stocks, the six stocks that were a part of the Index for all of 2018 were DBS Group Holdings, Jardine Cycle &amp; Carriage, Mapletree Logistics Trust, Oversea-Chinese Banking Corp, Singapore Telecommunications, and United Overseas Bank. These six stocks averaged a 5.0% decline in total return in 2018, in-line with the Straits Times Index (“STI”) decline in total return of 6.5%. 
	 </li>
	<li>
The three SGX-listed stocks that were removed from the Index in October were Ascendas REIT, ComfortDelGro Corporation and Mapletree Industrial Trust. These three stocks averaged a 4.4% total return in 2018, outperforming the Straits Times Index by almost 10.0%.  
	 </li>
</ul>
FTSE Value-Stocks ASEAN Index up 41.7% Over Past 3 years

As detailed on Page 2 of the FTSE Asia Monthly Report (click <a href="https://www.ftse.com/Analytics/factsheets/Home/Search">here</a>), the FTSE Value-Stocks ASEAN Index generated a 41.7% USD total return over the three years ending 2018. The Index ran a close second on the tally board to the 42.0% USD total return for the FTSE Developed Asia Pacific ex-Japan Cyclical Index.

The least performing of the 39 regional indices was the FTSE Renaissance Asia Pacific ex-Japan IPO Index which gained 1.3%. The FTSE Renaissance Global IPO Index Series is designed to track the activity and performance of the global IPO market, and to add structure and transparency to these equities, providing market participants controlled access to the attributes of IPOs (more details can be found <a href="https://www.ftse.com/products/indices/renaissance-ipo">here</a>).

In Singapore, very different performances of the STI were logged for each of the three years. In 2016, the STI was level for the year, with dividends providing the 3.8% total return. In 2017, the STI was one of the strongest markets across the world, with a 22.0% total return, followed by a 6.5% decline in total return for 2018. This meant that the FTSE Value-Stocks ASEAN Index returns were double that of the STI over the three years.  

The current 10 SGX-listed stocks of the FTSE Value-Stocks ASEAN also averaged a 41.4% total return in USD terms over the three years, which was equivalent to a 36.1% total return in SGD terms. The STI generated an 18.6% total return over the three year period ending 2018. The current 10 stocks and their performances are tabled below. 
 

<table class="table table-striped"><tbody>
<tr>
<td>
			Constituent
			</td>
			<td>
			SGX Code
			</td>
			<td>
			Market Cap (In Billions)
			</td>
			<td>
			Total Return (2015-2018) in SGD
			</td>
			<td>
			2019 YTD Total Return in SGD
			</td>
		</tr>
<tr>
<td>
			DBS Group Holdings 
			</td>
			<td>
			D05
			</td>
			<td>
			62.4
			</td>
			<td>
			61.6%
			</td>
			<td>
			3.2%
			</td>
		</tr>
<tr>
<td>
			Singapore Telecommunications 
			</td>
			<td>
			Z74
			</td>
			<td>
			49.6
			</td>
			<td>
			-6.9%
			</td>
			<td>
			3.8%
			</td>
		</tr>
<tr>
<td>
			Oversea-Chinese Banking Corp 
			</td>
			<td>
			O39
			</td>
			<td>
			49.3
			</td>
			<td>
			42.3%
			</td>
			<td>
			3.1%
			</td>
		</tr>
<tr>
<td>
			United Overseas Bank 
			</td>
			<td>
			U11
			</td>
			<td>
			43.0
			</td>
			<td>
			39.7%
			</td>
			<td>
			5.0%
			</td>
		</tr>
<tr>
<td>
			Jardine Cycle &amp; Carriage 
			</td>
			<td>
			C07
			</td>
			<td>
			14.4
			</td>
			<td>
			10.3%
			</td>
			<td>
			3.3%
			</td>
		</tr>
<tr>
<td>
			City Developments 
			</td>
			<td>
			C09
			</td>
			<td>
			7.9
			</td>
			<td>
			11.7%
			</td>
			<td>
			7.1%
			</td>
		</tr>
<tr>
<td>
			UOL Group 
			</td>
			<td>
			U14
			</td>
			<td>
			5.4
			</td>
			<td>
			6.0%
			</td>
			<td>
			4.2%
			</td>
		</tr>
<tr>
<td>
			Mapletree Logistics Trust
			</td>
			<td>
			M44U
			</td>
			<td>
			4.8
			</td>
			<td>
			56.0%
			</td>
			<td>
			5.6%
			</td>
		</tr>
<tr>
<td>
			Venture Corp 
			</td>
			<td>
			V03
			</td>
			<td>
			4.3
			</td>
			<td>
			95.7%
			</td>
			<td>
			6.9%
			</td>
		</tr>
<tr>
<td>
			Bukit Sembawang Estates 
			</td>
			<td>
			B61
			</td>
			<td>
			1.5
			</td>
			<td>
			45.9%
			</td>
			<td>
			0.0%
			</td>
		</tr>
<tr>
<td>
			Average
			</td>
			<td>
			 
			</td>
			<td>
			 
			</td>
			<td>
			36.2%
			</td>
			<td>
			4.2%
			</td>
		</tr>
</tbody></table>
Source: SGX StockFacts, Thomson Reuters &amp; Bloomberg (Data as of 10 January 2019)

With the exception of Venture Corporation, all 10 of the above stocks were recipient of capital inflows from retail investors in 2018, with the net inflows totalling S$2.7 billion. 

 

FTSE Value-Stocks ASEAN Index Methodology 

The FTSE Value-Stocks ASEAN Index is a value-based index designed by Value Partners Index Services Limited (“VP”) and created, calculated and maintained by FTSE International Limited.

Each security must be a current constituent of the FTSE Global All Cap Index. In the Index screening, VP will screen each security in the ASEAN Investable Universe and each will be ranked by three sets of value-investing screening criteria, namely Contrarian, Quality and Valuation screenings. Note the largest capitalised stocks that meet the criteria will be selected.

<ul>
<li>Contrarian screening aims to avoid following the herd. Companies in the investable universe covered by more than 10 analysts in the forecast recommendation with a buy recommendation from over 80% of analysts will be screened out. 
	 </li>
	<li>Quality screening is applied to avoid value traps and based on three fundamental factors: 3-year Average Return on Equity, Operating Profit Margin and Net Gearing. 
	 </li>
	<li>Valuation screening helps to identify relatively under-valued constituents in the ASEAN Investable Universe with rankings based on Dividend Yield and Forecast Price-to-Earnings.</li>
</ul>
From the ASEAN Investable Universe, the companies passing through all these screenings are ranked by PE ratio and the companies with the lowest PE ratio are selected to be the constituents of the Index. The Index is free float weighted and constituent stocks are capped at 5% weightings to avoid over-concentration in any one stock. For more details on the Index methodology, click <a href="http://www.ftse.com/products/downloads/FTSE_Value_Stocks_ASEAN_Index__English_.pdf?78">here</a>. 
</body></html>





The FTSE Value-Stocks ASEAN Index was amongst the strongest FTSE regional indices over the three years ending 2018. Its total return of 42% in USD terms outpaced 37 other regional indices published by FTSE Russell.    
	 
	
The 10 current SGX-listed stocks of the FTSE Value-Stocks ASEAN Index were in-line with the Index, averaging 42% total returns [in USD terms] over the three years, doubling the STI returns over the same period. The 10 stocks have also averaged 4% gains in the 2019 YTD. 
	 
	The Index is based on value investing principles and comprised of the largest capitalised stocks of the FTSE Global All Cap Index that meet value-investing screening criteria, namely Contrarian, Quality &amp; Valuation screenings, which are then ranked by lowest P/E Ratios.

Amid the region’s market moves of the past three years, the performances of several Asia Pacific indices have deviated by as much as 40%.

The strongest performers were cyclical Index stocks listed in Asia Pacific’s developed financial centres outside of Japan, ASEAN Value stocks and Asia Pacific ex-Japan Shariah stocks.  The least strongest Index performers over the past three years were the stocks making up an Asia Pacific Initial Public Offerings (“IPOs”) Index and Asia Pacific ex-Japan Small Cap stocks. This is based on the FTSE Asia Monthly Index Performance Report for Asia Pacific published earlier this month.

The FTSE Value-Stocks ASEAN Index consists of 50 quality value stocks amongst liquid and tradable ASEAN companies listed on the Indonesia Stock Exchange, Bursa Malaysia, the Philippine Stock Exchange,  Singapore Exchange (“SGX”) and the Stock Exchange of Thailand. As many as 10 of the 50 constituents are listed in Singapore. 
 

Singapore Constituents of the FTSE Value-Stocks ASEAN Index

The current SGX-listed stocks of the FTSE Value-Stocks ASEAN Index are Bukit Sembawang Estates, City Developments, DBS Group Holdings, Jardine Cycle &amp; Carriage, Mapletree Logistics Trust, Oversea-Chinese Banking Corp, Singapore Telecommunications, United Overseas Bank, UOL Group and Venture Corporation.


Of these current 10 stocks, the six stocks that were a part of the Index for all of 2018 were DBS Group Holdings, Jardine Cycle &amp; Carriage, Mapletree Logistics Trust, Oversea-Chinese Banking Corp, Singapore Telecommunications, and United Overseas Bank. These six stocks averaged a 5.0% decline in total return in 2018, in-line with the Straits Times Index (“STI”) decline in total return of 6.5%.  
	 
	
The three SGX-listed stocks that were removed from the Index in October were Ascendas REIT, ComfortDelGro Corporation and Mapletree Industrial Trust. These three stocks averaged a 4.4% total return in 2018, outperforming the Straits Times Index by almost 10.0%.  
	 

FTSE Value-Stocks ASEAN Index up 41.7% Over Past 3 years

As detailed on Page 2 of the FTSE Asia Monthly Report (click here), the FTSE Value-Stocks ASEAN Index generated a 41.7% USD total return over the three years ending 2018. The Index ran a close second on the tally board to the 42.0% USD total return for the FTSE Developed Asia Pacific ex-Japan Cyclical Index.

The least performing of the 39 regional indices was the FTSE Renaissance Asia Pacific ex-Japan IPO Index which gained 1.3%. The FTSE Renaissance Global IPO Index Series is designed to track the activity and performance of the global IPO market, and to add structure and transparency to these equities, providing market participants controlled access to the attributes of IPOs (more details can be found here).

In Singapore, very different performances of the STI were logged for each of the three years. In 2016, the STI was level for the year, with dividends providing the 3.8% total return. In 2017, the STI was one of the strongest markets across the world, with a 22.0% total return, followed by a 6.5% decline in total return for 2018. This meant that the FTSE Value-Stocks ASEAN Index returns were double that of the STI over the three years.  

The current 10 SGX-listed stocks of the FTSE Value-Stocks ASEAN also averaged a 41.4% total return in USD terms over the three years, which was equivalent to a 36.1% total return in SGD terms. The STI generated an 18.6% total return over the three year period ending 2018. The current 10 stocks and their performances are tabled below. 
 




			Constituent
			
			
			SGX Code
			
			
			Market Cap (In Billions)
			
			
			Total Return (2015-2018) in SGD
			
			
			2019 YTD Total Return in SGD
			
		


			DBS Group Holdings 
			
			
			D05
			
			
			62.4
			
			
			61.6%
			
			
			3.2%
			
		


			Singapore Telecommunications 
			
			
			Z74
			
			
			49.6
			
			
			-6.9%
			
			
			3.8%
			
		


			Oversea-Chinese Banking Corp 
			
			
			O39
			
			
			49.3
			
			
			42.3%
			
			
			3.1%
			
		


			United Overseas Bank 
			
			
			U11
			
			
			43.0
			
			
			39.7%
			
			
			5.0%
			
		


			Jardine Cycle &amp; Carriage 
			
			
			C07
			
			
			14.4
			
			
			10.3%
			
			
			3.3%
			
		


			City Developments 
			
			
			C09
			
			
			7.9
			
			
			11.7%
			
			
			7.1%
			
		


			UOL Group 
			
			
			U14
			
			
			5.4
			
			
			6.0%
			
			
			4.2%
			
		


			Mapletree Logistics Trust
			
			
			M44U
			
			
			4.8
			
			
			56.0%
			
			
			5.6%
			
		


			Venture Corp 
			
			
			V03
			
			
			4.3
			
			
			95.7%
			
			
			6.9%
			
		


			Bukit Sembawang Estates 
			
			
			B61
			
			
			1.5
			
			
			45.9%
			
			
			0.0%
			
		


			Average
			
			
			 
			
			
			 
			
			
			36.2%
			
			
			4.2%
			
		

Source: SGX StockFacts, Thomson Reuters &amp; Bloomberg (Data as of 10 January 2019)

With the exception of Venture Corporation, all 10 of the above stocks were recipient of capital inflows from retail investors in 2018, with the net inflows totalling S$2.7 billion. 

 

FTSE Value-Stocks ASEAN Index Methodology 

The FTSE Value-Stocks ASEAN Index is a value-based index designed by Value Partners Index Services Limited (“VP”) and created, calculated and maintained by FTSE International Limited.

Each security must be a current constituent of the FTSE Global All Cap Index. In the Index screening, VP will screen each security in the ASEAN Investable Universe and each will be ranked by three sets of value-investing screening criteria, namely Contrarian, Quality and Valuation screenings. Note the largest capitalised stocks that meet the criteria will be selected.


Contrarian screening aims to avoid following the herd. Companies in the investable universe covered by more than 10 analysts in the forecast recommendation with a buy recommendation from over 80% of analysts will be screened out. 
	 
	Quality screening is applied to avoid value traps and based on three fundamental factors: 3-year Average Return on Equity, Operating Profit Margin and Net Gearing. 
	 
	Valuation screening helps to identify relatively under-valued constituents in the ASEAN Investable Universe with rankings based on Dividend Yield and Forecast Price-to-Earnings.

From the ASEAN Investable Universe, the companies passing through all these screenings are ranked by PE ratio and the companies with the lowest PE ratio are selected to be the constituents of the Index. The Index is free float weighted and constituent stocks are capped at 5% weightings to avoid over-concentration in any one stock. For more details on the Index methodology, click here. 



Big ASEAN Value Stocks a Highlight of the Past 3 Years         

<!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd">

Real Estate Managers & Developers Led the STI in 2017 YTD

Singapore

Bukit Sembawang Estates Limited, through its subsidiaries, operates in property development, property mortgage financing, and the holding of properties and investments. The Company provides residential property development throughout Singapore.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Bukit Sembawang Estates (BS SP)

Big ASEAN Value Stocks a Highlight of the Past 3 Years

The FTSE Value-Stocks ASEAN Index was amongst the strongest FTSE regional indices over the three years ending 2018. Its total return of 42% in...

Singapore Exchange Ltd (SGX)

Real Estate Managers & Developers Led the STI in 2017 YTD

Singapore Exchange Ltd (SGX)

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)