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.

Equity Bottom-Up

Capitaland Integrated Commercial Trust / Equity Bottom-Up

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For the 5 trading sessions that spanned May 20 to 26, the Straits Times Index (STI) gained 0.6 per cent, with the FTSE China A50 Index declining 1.1 per cent, the Hang Seng Index dipping 0.5 per cent and the FTSE Bursa Malaysia KLCI sliding 0.8 per cent. 

Overall, institutions were net sellers of Singapore stocks over the 5 sessions with S$109 million of net outflow, following the S$3.4 million of net inflow for the preceding 5 sessions. DBS Group Holdings, OCBC, Ascendas Reit, CapitaLand Integrated Commercial Trust and Suntec Reit led the net institutional outflows for the 5 sessions through to May 26. Share buybacks

There were 20 primary-listed stocks conducting share buybacks over the 5 sessions ended May 26, with a total consideration of S$51,483,484, down from the S$67,410,124 million for the preceding 5 sessions. 
Keppel Corporation led the consideration tally with 3,644,000 shares bought at an average price of S$6.80 per share. This brought the total amount of shares purchased on its current mandate to 0.86 per cent of its issued shares (excluding treasury shares).

The preceding mandate saw Keppel buy back 1.52 per cent of its issued shares.

On May 24, the company announced that Keppel Offshore &amp; Marine had, through its wholly owned subsidiaries, signed contracts for the bareboat charter of another 2 KFELS B Class rigs to be deployed in the Middle East. 
The rigs will be chartered to an established drilling company in the Middle East for deployment in Q4 2022 for a period of 3 years, with options for a year’s extension.

Total revenue from the charters, including the options and modification works by Keppel O&amp;M to prepare the rigs for on-site operations, is expected to be up to S$120 million.

Hong Fok Corporation : H30 0% led the buyback consideration tally for the non-STI stocks over the 5 sessions, purchasing 1,328,000 shares at an average price of 90.1 cents per share.

This brought the total amount of shares purchased on the current mandate to 0.82 per cent of its issued shares (excluding treasury shares).

At the Apr 27 AGM, the chairman of Hong Fok reported that the group had made a good recovery from the effects of the Covid-19 pandemic with an increase in revenue mainly from the sale of more residential units in Concourse Skyline, the sale of the last unit at Jewel of Balmoral, higher property management income and dividend income. Director and substantial shareholder transactions

The 5 trading sessions saw fewer than 70 changes to director interests and substantial shareholdings filed for just over 30 primary-listed stocks.

This included 7 company director acquisitions with 3 disposals filed, while substantial shareholders filed 3 acquisitions and 4 disposals.

Centurion Corporation

Between May 20 and 25, Centurion Corporation executive director and joint chairman David Loh Kim Kang acquired 1,831,300 shares of the purpose-built accommodation developer and manager for a consideration of S$640,955.

At 35.0 cents per share, this took his total interest in from 55.18 per cent to 55.40 per cent.

Loh’s preceding acquisition was in October 2020 with 200,000 shares acquired at 33.5 cents per share. He is responsible for the formulation of corporate and business strategies of the company and leads the execution of strategic growth plans of the group.

He has over 20 years of experience in the investment and brokerage industry and has been a principal and director of Centurion Global Ltd, a controlling shareholder of the company from April 2008 to the present.

On May 10, Centurion provided a business update, highlighting a 47 per cent year-on-year increase in Q1 2022 revenue.

This was attributed to higher contributions mainly from new purpose-built worker accommodation (PBWA) capacity and revenue streams, improved performance in Singapore PBWA accommodation assets, and recovery of occupancies in the UK and Australia purpose-built student accommodation portfolio.

These higher contributions were partly offset by the cessation of operations of dwell Selegie and the conclusion of management contracst for 2 factory-converted workers dormitories in Singapore.

Looking ahead, the company noted that as economies recover from Covid-19, and international travel resuming, populations of migrant workers and international students continue to expand across the geographies where Centurion operates. ABR Holdings

Between May 23 and 24, ABR Holdings managing director Ang Yee Lim acquired 301,700 shares of the company for a consideration of S$142,721 at an average price of 47.3 cents per share.

This took Ang’s interest in the restaurant operator from 51.71 per cent to 51.86 per cent. His preceding acquisition was on Dec 21 with 120,000 shares acquired at 46.0 cents per share.

ABR Holdings traces its roots to 1979 with the establishment of the 200-seater Swensen’s at Thomson Plaza, the first full-service ice-cream restaurant in Singapore.

Today, ABR operates more than 25 restaurant outlets and the Swensen’s brand has become synonymous with family friendly dining.

Ang was appointed to the board as an executive director in May 2004, and subsequently appointed managing director in July 2004.

He has over 20 years of experience in the food and beverage business and more than 30 years of experience in property development and investment in Singapore, Malaysia, Indonesia and Thailand. AnnAik

Between May 24 and 25, Low Kheng, spouse of AnnAik executive chairman cum CEO, Ow Chin Seng, purchased 1,794,900 shares of the company for a consideration of $155,292.

At an average price of 8.7 cents per share, this increased Ow’s total interest in the manufacturer and distributor of stainless-steel products from 38.34 per cent to 38.96 per cent.

Ow is primarily responsible for the business and strategic development of the group. With over 40 years of experience in the hardware and steel industry, he has been instrumental in the strategic direction and development of the group.

With last year’s hike in steel prices, strong demand of steel products and contribution of the environmental division, AnnAik achieved an attributable profit in 2021 of S$3.09 million, compared to S$177,000 in 2020. Dyna-Mac Holdings

On May 26, Dyna-Mac Holdings independent non-executive director Henry Tan Song Kok acquired 500,000 shares of the company at 15.7 cents per share.

With a consideration of S$78,600 this took his direct interest in the global multi-disciplinary contractor to 0.05 per cent.

Tan is also an independent director, on the boards of Asia Vets Holdings, BH Global Corporation, Penguin International and Trans-China Automotive Holdings. LHT Holdings

On May 24, LHT Holdings managing director, Yap Mui Kee, acquired 49,500 shares of the company for a consideration of S$34,719.

At an average price of 70.1 cents per share, this took her direct interest in the manufacturer of high-quality wooden pallets, boxes, and crates from 14.89 per cent to 14.99 per cent.

Preceding acquisitions saw Yap buy 52,100 shares at 71.0 cents per share on Mar 25, 17,700 shares at 70.0 cents per share on Mar 18 and 24,600 shares of at 69.1 cents per share on Mar 7.

Yap has over 35 years of experience in sales and marketing and plays a key role in exploring opportunities in new markets.

Part of her responsibility is also to monitor market developments and streamline the company’s product development efforts according to market demands.

Yap spearheads the group’s RFID (Radio Frequency Identification) ECR Pallet Tracking System and is actively involved in its ECR (Efficient Consumer Response) pallet rental business in Singapore and Malaysia. Oxley Holdings

On May 25, Oxley Holdings executive director and deputy CEO Eric Low See Ching acquired 50,000 shares of the company at an average price of 17.7 cents per share, at a consideration of S$8,850.

Low maintains a 28.13 per cent direct interest in Oxley Holdings and is responsible for the operation of the group, including sales and marketing, project development, business development and financial management.

Low also assists the CEO in charting and executing the strategic plans for the group. Inside Insights is a weekly column on The Business Times,<a href="https://www.businesstimes.com.sg/companies-markets/centurions-david-loh-raises-stake-keppel-leads-buyback-tally"> read </a>the original version.
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    Share buyback


For the 5 trading sessions that spanned May 20 to 26, the Straits Times Index (STI) gained 0.6 per cent, with the FTSE China A50 Index declining 1.1 per cent, the Hang Seng Index dipping 0.5 per cent and the FTSE Bursa Malaysia KLCI sliding 0.8 per cent. 

Overall, institutions were net sellers of Singapore stocks over the 5 sessions with S$109 million of net outflow, following the S$3.4 million of net inflow for the preceding 5 sessions. DBS Group Holdings, OCBC, Ascendas Reit, CapitaLand Integrated Commercial Trust and Suntec Reit led the net institutional outflows for the 5 sessions through to May 26.  Share buybacks

There were 20 primary-listed stocks conducting share buybacks over the 5 sessions ended May 26, with a total consideration of S$51,483,484, down from the S$67,410,124 million for the preceding 5 sessions.  
Keppel Corporation led the consideration tally with 3,644,000 shares bought at an average price of S$6.80 per share. This brought the total amount of shares purchased on its current mandate to 0.86 per cent of its issued shares (excluding treasury shares).

The preceding mandate saw Keppel buy back 1.52 per cent of its issued shares.

On May 24, the company announced that Keppel Offshore &amp; Marine had, through its wholly owned subsidiaries, signed contracts for the bareboat charter of another 2 KFELS B Class rigs to be deployed in the Middle East.  
The rigs will be chartered to an established drilling company in the Middle East for deployment in Q4 2022 for a period of 3 years, with options for a year’s extension.

Total revenue from the charters, including the options and modification works by Keppel O&amp;M to prepare the rigs for on-site operations, is expected to be up to S$120 million.

Hong Fok Corporation : H30 0% led the buyback consideration tally for the non-STI stocks over the 5 sessions, purchasing 1,328,000 shares at an average price of 90.1 cents per share.

This brought the total amount of shares purchased on the current mandate to 0.82 per cent of its issued shares (excluding treasury shares).

At the Apr 27 AGM, the chairman of Hong Fok reported that the group had made a good recovery from the effects of the Covid-19 pandemic with an increase in revenue mainly from the sale of more residential units in Concourse Skyline, the sale of the last unit at Jewel of Balmoral, higher property management income and dividend income.  Director and substantial shareholder transactions

The 5 trading sessions saw fewer than 70 changes to director interests and substantial shareholdings filed for just over 30 primary-listed stocks.

This included 7 company director acquisitions with 3 disposals filed, while substantial shareholders filed 3 acquisitions and 4 disposals.

Centurion Corporation

Between May 20 and 25, Centurion Corporation executive director and joint chairman David Loh Kim Kang acquired 1,831,300 shares of the purpose-built accommodation developer and manager for a consideration of S$640,955.

At 35.0 cents per share, this took his total interest in from 55.18 per cent to 55.40 per cent.

Loh’s preceding acquisition was in October 2020 with 200,000 shares acquired at 33.5 cents per share. He is responsible for the formulation of corporate and business strategies of the company and leads the execution of strategic growth plans of the group.

He has over 20 years of experience in the investment and brokerage industry and has been a principal and director of Centurion Global Ltd, a controlling shareholder of the company from April 2008 to the present.

On May 10, Centurion provided a business update, highlighting a 47 per cent year-on-year increase in Q1 2022 revenue.

This was attributed to higher contributions mainly from new purpose-built worker accommodation (PBWA) capacity and revenue streams, improved performance in Singapore PBWA accommodation assets, and recovery of occupancies in the UK and Australia purpose-built student accommodation portfolio.

These higher contributions were partly offset by the cessation of operations of dwell Selegie and the conclusion of management contracst for 2 factory-converted workers dormitories in Singapore.

Looking ahead, the company noted that as economies recover from Covid-19, and international travel resuming, populations of migrant workers and international students continue to expand across the geographies where Centurion operates.  ABR Holdings

Between May 23 and 24, ABR Holdings managing director Ang Yee Lim acquired 301,700 shares of the company for a consideration of S$142,721 at an average price of 47.3 cents per share.

This took Ang’s interest in the restaurant operator from 51.71 per cent to 51.86 per cent. His preceding acquisition was on Dec 21 with 120,000 shares acquired at 46.0 cents per share.

ABR Holdings traces its roots to 1979 with the establishment of the 200-seater Swensen’s at Thomson Plaza, the first full-service ice-cream restaurant in Singapore.

Today, ABR operates more than 25 restaurant outlets and the Swensen’s brand has become synonymous with family friendly dining.

Ang was appointed to the board as an executive director in May 2004, and subsequently appointed managing director in July 2004.

He has over 20 years of experience in the food and beverage business and more than 30 years of experience in property development and investment in Singapore, Malaysia, Indonesia and Thailand.  AnnAik

Between May 24 and 25, Low Kheng, spouse of AnnAik executive chairman cum CEO, Ow Chin Seng, purchased 1,794,900 shares of the company for a consideration of $155,292.

At an average price of 8.7 cents per share, this increased Ow’s total interest in the manufacturer and distributor of stainless-steel products from 38.34 per cent to 38.96 per cent.

Ow is primarily responsible for the business and strategic development of the group. With over 40 years of experience in the hardware and steel industry, he has been instrumental in the strategic direction and development of the group.

With last year’s hike in steel prices, strong demand of steel products and contribution of the environmental division, AnnAik achieved an attributable profit in 2021 of S$3.09 million, compared to S$177,000 in 2020.  Dyna-Mac Holdings

On May 26, Dyna-Mac Holdings independent non-executive director Henry Tan Song Kok acquired 500,000 shares of the company at 15.7 cents per share.

With a consideration of S$78,600 this took his direct interest in the global multi-disciplinary contractor to 0.05 per cent.

Tan is also an independent director, on the boards of Asia Vets Holdings, BH Global Corporation, Penguin International and Trans-China Automotive Holdings.  LHT Holdings

On May 24, LHT Holdings managing director, Yap Mui Kee, acquired 49,500 shares of the company for a consideration of S$34,719.

At an average price of 70.1 cents per share, this took her direct interest in the manufacturer of high-quality wooden pallets, boxes, and crates from 14.89 per cent to 14.99 per cent.

Preceding acquisitions saw Yap buy 52,100 shares at 71.0 cents per share on Mar 25, 17,700 shares at 70.0 cents per share on Mar 18 and 24,600 shares of at 69.1 cents per share on Mar 7.

Yap has over 35 years of experience in sales and marketing and plays a key role in exploring opportunities in new markets.

Part of her responsibility is also to monitor market developments and streamline the company’s product development efforts according to market demands.

Yap spearheads the group’s RFID (Radio Frequency Identification) ECR Pallet Tracking System and is actively involved in its ECR (Efficient Consumer Response) pallet rental business in Singapore and Malaysia.  Oxley Holdings

On May 25, Oxley Holdings executive director and deputy CEO Eric Low See Ching acquired 50,000 shares of the company at an average price of 17.7 cents per share, at a consideration of S$8,850.

Low maintains a 28.13 per cent direct interest in Oxley Holdings and is responsible for the operation of the group, including sales and marketing, project development, business development and financial management.

Low also assists the CEO in charting and executing the strategic plans for the group.  Inside Insights is a weekly column on The Business Times, read the original version.



Centurion’s David Loh raises stake; Keppel leads buyback tally

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 <div class='content-caption'>S-Reits with significant Singapore-based retail assets</div>
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<html><body>Singapore focused office S-Reits remain poised to benefit as more employees return to the office. The Urban Redevelopment Authority (URA) office rental index in the Central Region grew 1.6 per cent and for a second consecutive quarter in Q1 2022 driven by limited supply. 
CBRE Research also expects Core Central Business District (CBD) rents to increase by 6.9 per cent year on year for the whole of 2022. 
SGX lists 6 S-Reits with exposure to Singapore-based office assets. Keppel REIT is a pure-play office S-REIT while CapitaLand Integrated Commercial Trust (CICT), Mapletree Commercial Trust (MCT), Suntec REIT, OUE Commercial REIT and Lendlease Global Commercial REIT are diversified S-REITs with exposure to Singapore office properties. 
Keppel Reit reported a 4.3 per cent year-on-year growth in distributable income for Q1 2022 mainly from its acquisition of Keppel Bay Tower last year. 
Most of its new leases for Q1 2022 were in Singapore (Ocean Financial Centre, Marina Bay Financial Centre, and One Raffles Quay), with average signing rent for Singapore office leases at S$11.15 psf pm, higher than Singapore’s average core CBD Grade A office rents (S$10.95 psf pm). 
CICT reported improved portfolio occupancy of 92.3 per cent in its Singapore portfolio and has seen a 9.3 per cent increase in rent reversion in Q1 2022. 
CICT most recently completed its acquisition of a 70 per cent interest in CapitaSky (formerly known as 79 Robinson Road) which has a committed occupancy of 92.9 per cent and net property income yield of 4 per cent. 
MCT reported that its FY21/22 gross revenue from office/business park assets grew 1.9 per cent year on year driven by higher contributions from Mapletree Business City, mTower and MLHF. All its office/business park assets reported strong occupancy rates, with mTower observing significant growth from 75 per cent to 84.7 per cent. 
Mapletree Anson closed its transitional vacancy as it reported full commitment. MCT expects positive leasing momentum for office/business park to continue through to the new financial year. 
Suntec Reit saw its office committed occupancy strengthen to 97.5 per cent and recorded a 3.2 per cent increase in rent reversion for FY21. 
The Reit noted income contribution from its Singapore office portfolio is expected to grow, driven by cumulative positive rent reversions achieved in the past 11 quarters and full impact of revenue from leases committed in 2021. 
OUE Commercial Reit noted that average passing rents of its Singapore office properties were higher year on year, with OUE Bayfront hitting a high of S$12.49 psf. 
Its office properties were observed to record higher valuations ranging from 0.2 to 7.5 per cent year on year, compared to its other segments. 
Lendlease Global Commercial Reit completed its 100 per cent direct interest in Jem. Its Jem office component is fully leased to the Ministry of National Development on a 30-year master lease with a rent review every five years. REIT Watch is a weekly column on The Business Times,<a href="https://www.businesstimes.com.sg/companies-markets/tenant-sales-back-at-pre-covid-levels-for-retail-s-reits"> </a><a href="https://www.businesstimes.com.sg/companies-markets/singapore-based-office-s-reits-report-improved-metrics-and-higher-rents">read </a>the original version.</body></html>


      
    
    S-Reits with significant Singapore-based retail assets

Singapore focused office S-Reits remain poised to benefit as more employees return to the office. The Urban Redevelopment Authority (URA) office rental index in the Central Region grew 1.6 per cent and for a second consecutive quarter in Q1 2022 driven by limited supply.  
CBRE Research also expects Core Central Business District (CBD) rents to increase by 6.9 per cent year on year for the whole of 2022.  
SGX lists 6 S-Reits with exposure to Singapore-based office assets. Keppel REIT is a pure-play office S-REIT while CapitaLand Integrated Commercial Trust (CICT), Mapletree Commercial Trust (MCT), Suntec REIT, OUE Commercial REIT and Lendlease Global Commercial REIT are diversified S-REITs with exposure to Singapore office properties.  
Keppel Reit reported a 4.3 per cent year-on-year growth in distributable income for Q1 2022 mainly from its acquisition of Keppel Bay Tower last year.  
Most of its new leases for Q1 2022 were in Singapore (Ocean Financial Centre, Marina Bay Financial Centre, and One Raffles Quay), with average signing rent for Singapore office leases at S$11.15 psf pm, higher than Singapore’s average core CBD Grade A office rents (S$10.95 psf pm).  
CICT reported improved portfolio occupancy of 92.3 per cent in its Singapore portfolio and has seen a 9.3 per cent increase in rent reversion in Q1 2022.  
CICT most recently completed its acquisition of a 70 per cent interest in CapitaSky (formerly known as 79 Robinson Road) which has a committed occupancy of 92.9 per cent and net property income yield of 4 per cent.  
MCT reported that its FY21/22 gross revenue from office/business park assets grew 1.9 per cent year on year driven by higher contributions from Mapletree Business City, mTower and MLHF. All its office/business park assets reported strong occupancy rates, with mTower observing significant growth from 75 per cent to 84.7 per cent.  
Mapletree Anson closed its transitional vacancy as it reported full commitment. MCT expects positive leasing momentum for office/business park to continue through to the new financial year.  
Suntec Reit saw its office committed occupancy strengthen to 97.5 per cent and recorded a 3.2 per cent increase in rent reversion for FY21.  
The Reit noted income contribution from its Singapore office portfolio is expected to grow, driven by cumulative positive rent reversions achieved in the past 11 quarters and full impact of revenue from leases committed in 2021.  
OUE Commercial Reit noted that average passing rents of its Singapore office properties were higher year on year, with OUE Bayfront hitting a high of S$12.49 psf.  
Its office properties were observed to record higher valuations ranging from 0.2 to 7.5 per cent year on year, compared to its other segments.  
Lendlease Global Commercial Reit completed its 100 per cent direct interest in Jem. Its Jem office component is fully leased to the Ministry of National Development on a 30-year master lease with a rent review every five years.  REIT Watch is a weekly column on The Business Times, read the original version.


REIT Watch - Singapore-based Office S-REITs report improved metrics and higher rents 

Mapletree Pan Asia Commercial Trust / Equity Bottom-Up

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<html><body>Singapore's retail sales increased 8.7 per cent in March 2022 on a year-on-year basis, a reversal from the 3.5 per cent decrease in February 2022, according to the Singapore Department of Statistics (SingStat). 
Within the retail trade sector, most industries recorded year-on-year sales growth in March 2022. 
Listed on the SGX are 7 S-Reits which have significant exposure to Singapore-based retail assets. 
All seven S-Reits have announced their financial results or business updates this reporting season and they are: CapitaLand Integrated Commercial Trust, Frasers Centrepoint Trust, Lendlease Global Commercial Reit, Mapletree Commercial Trust, SPH Reit, Starhill Global Reit and Suntec Reit. 
CapitaLand Integrated Commercial Trust’s (CICT) net property income (NPI) from its retail assets grew 0.6 per cent year on year to S$101.8 million in Q1 2022. 
Its retail occupancy maintained at 96.6 per cent as at Mar 31, 2022 while tenant retention rate is 91 per cent in Q1 2022. 
Frasers Centrepoint Trust (FCT) reported that its retail portfolio occupancy improved from 97.2 per cent last quarter to 97.8 per cent. 
It noted that shopper traffic has improved to around 65 per cent of pre-Covid levels during the January to March 2022 period while tenants’ sales have maintained at above pre-Covid levels since Oct 2021. 
Lendlease Global Commercial Reit (LReit) noted that its retail portfolio saw strong occupancy rate, maintaining above 99 per cent, with a healthy tenant retention rate of 71.1 per cent 
The Reit completed its capital fundraising exercise to acquire 100 per cent of Jem mall in April 2022. LReit is also confident that 313@somerset will benefit from the re-opening trajectory in Singapore. 
Mapletree Commercial Trust (MCT) saw healthy performance at VivoCity mall, which had a 99.2 per cent committed occupancy as at Mar 31, 2022. 
It noted that, in tandem with easing Covid-19 measures, tenant sales kept a steady recovery momentum with fourth quarter FY21/22 tenant sales rebounding by 10.3 per cent on a year-on-year basis, reaching pre-Covid levels. 
SPH Reit’s Singapore retail assets maintained an occupancy rate of 99.1 per cent as at Feb 28, 2022 and noted that overall tenant sales for the Singapore assets increased 2 per cent year on year for H1 FY2022. 
Starhill Global Reit’s Singapore retail occupancy rates remained at 98.9 per cent as at Mar 31, 2022. Shopper traffic and tenant sales at Wisma Atria increased 11.7 per cent and 18.2 per cent year on year respectively during the quarter. 
Suntec Reit reported 13.9 per cent year-on-year growth in Q1 2022 gross revenue, partly contributed by higher income from Suntec City Office and Suntec City Mall. 
The Reit believes that the easing of Covid-19 pandemic restrictions and the reopening of the economy will boost the recovery of footfall as well as tenant sales and that mall occupancy will likely remain stable at above 95 per cent. REIT Watch is a weekly column on The Business Times,<a href="https://www.businesstimes.com.sg/companies-markets/tenant-sales-back-at-pre-covid-levels-for-retail-s-reits"> read </a>the original version.</body></html>


      
    
    SREIT

Singapore's retail sales increased 8.7 per cent in March 2022 on a year-on-year basis, a reversal from the 3.5 per cent decrease in February 2022, according to the Singapore Department of Statistics (SingStat).  
Within the retail trade sector, most industries recorded year-on-year sales growth in March 2022.  
Listed on the SGX are 7 S-Reits which have significant exposure to Singapore-based retail assets.  
All seven S-Reits have announced their financial results or business updates this reporting season and they are: CapitaLand Integrated Commercial Trust, Frasers Centrepoint Trust, Lendlease Global Commercial Reit, Mapletree Commercial Trust, SPH Reit, Starhill Global Reit and Suntec Reit.  
CapitaLand Integrated Commercial Trust’s (CICT) net property income (NPI) from its retail assets grew 0.6 per cent year on year to S$101.8 million in Q1 2022.  
Its retail occupancy maintained at 96.6 per cent as at Mar 31, 2022 while tenant retention rate is 91 per cent in Q1 2022.  
Frasers Centrepoint Trust (FCT) reported that its retail portfolio occupancy improved from 97.2 per cent last quarter to 97.8 per cent.  
It noted that shopper traffic has improved to around 65 per cent of pre-Covid levels during the January to March 2022 period while tenants’ sales have maintained at above pre-Covid levels since Oct 2021.  
Lendlease Global Commercial Reit (LReit) noted that its retail portfolio saw strong occupancy rate, maintaining above 99 per cent, with a healthy tenant retention rate of 71.1 per cent  
The Reit completed its capital fundraising exercise to acquire 100 per cent of Jem mall in April 2022. LReit is also confident that 313@somerset will benefit from the re-opening trajectory in Singapore.  
Mapletree Commercial Trust (MCT) saw healthy performance at VivoCity mall, which had a 99.2 per cent committed occupancy as at Mar 31, 2022.  
It noted that, in tandem with easing Covid-19 measures, tenant sales kept a steady recovery momentum with fourth quarter FY21/22 tenant sales rebounding by 10.3 per cent on a year-on-year basis, reaching pre-Covid levels.  
SPH Reit’s Singapore retail assets maintained an occupancy rate of 99.1 per cent as at Feb 28, 2022 and noted that overall tenant sales for the Singapore assets increased 2 per cent year on year for H1 FY2022.  
Starhill Global Reit’s Singapore retail occupancy rates remained at 98.9 per cent as at Mar 31, 2022. Shopper traffic and tenant sales at Wisma Atria increased 11.7 per cent and 18.2 per cent year on year respectively during the quarter.  
Suntec Reit reported 13.9 per cent year-on-year growth in Q1 2022 gross revenue, partly contributed by higher income from Suntec City Office and Suntec City Mall.  
The Reit believes that the easing of Covid-19 pandemic restrictions and the reopening of the economy will boost the recovery of footfall as well as tenant sales and that mall occupancy will likely remain stable at above 95 per cent.  REIT Watch is a weekly column on The Business Times, read the original version.


REIT Watch - Tenant sales back at pre-Covid levels for Retail S-Reits

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<html><body>#whatstrending Ever wondered what is currently driving the local and regional markets? This new report series address some of the most trending questions/topics on the markets for investors. Designed to be educational, expect to get factual information on what is driving sectors and stocks listed on SGX Q: Singapore has announced further easing of border restrictions and stepped down DORSCON level from orange to yellow. How has this impacted the local equities market? 
Following the reopening of Singapore’s borders to all fully vaccinated travellers from 1 April 2022, Civil Aviation Authority of Singapore (CAAS) reported that air passenger traffic in Singapore reached 400,000 or 31% of pre-COVID levels in the week ending 17 April 2022, up from 18% a month ago. Transport Minister S Iswaran on 4 May stated Changi Airport passenger volumes has more than doubled to reach close to 40% of pre-COVID levels in end-April, up from 18% in March and on track to at least 50% of pre-COVID levels by this year. 
SIA also reported significant increase in passenger demand in its March operating results. The Group carried 893k passengers in March, a 792.1% YoY increase. Its group passenger capacity reached 51% of pre-COVID levels, and expects passenger capacity to reach 61% of pre-COVID levels by May 2022. 
We observed outperformance in the year-to-date for a number of reopening proxies including SATS, SIA, ComfortDelGro, Genting Singapore and SIA Engineering. These five stocks average total returns of 10.6%, outperforming STI’s +7.1% total returns YTD (as of 6 May ’22). On a funds flow perspective, these stocks saw a combined net institutional inflows of S$84.8 million in the YTD. 
The easing of measures also had an impact on the F&amp;B industry in Singapore. The top five actively traded SGX F&amp;B stocks with Singapore exposure are: Jumbo, Japan Foods, Pavillion, RE&amp;S and Kimly. Investors’ focus would be on Singapore’s F&amp;B service sales data for April. 
In the REITs Sector, SGX lists four stapled trusts and one REIT with significant exposure to Singapore hotels who may potentially benefit from reopening borders  - Ascott, CDL HT, Far East HT, Frasers HT, and OUE CREIT. These five trusts generated average total returns of 16.9% YTD (as of 6 May ’22). S-REITs with exposure to Singapore office assets as employees head back to office - Keppel REIT, CICT, Suntec REIT, MCT, and OUE CREIT.</body></html>

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 <img src='https://api2.sgx.com/sites/default/files/2022-05/Capture%201_0.PNG' alt='Mar 22 Changi Airport' />
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 <div class='content-caption'>Mar 22 Changi Airport</div>
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Q: Rate hikes to combat inflation continues to be a focus on investors globally. How is this impacting the markets? Which are the sectors which may see direct impact? 
The 16 March FOMC rate hike was in-line with market’s expectations. At the recent May FOMC, the Fed raised rates by 50bps, with a 75bps hike at the next meeting ruled out for now. Quantitative tightening will begin, with the Fed allowing up to US$47.5 billion/month in combined US treasuries and mortgage-backed securities to run off the balance sheet, increasing to US$95 billion after 3 months 
Rates sensitive sectors such as Financials and REITs typically come into investors’ minds during rate hike/cut cycles.

<ul>
<li>Notably, Singapore Banks – DBS (D05), OCBC (O39), and UOB (U11) has seen an average 7.2% gains since the start of heightened volatility in the markets (8 March), outperforming global banks and the STI. In the same period, the FTSE ST All-Share Index also saw total returns of +5.7%. 
	 </li>
	<li>REITs depend on borrowings/debt to help finance their asset purchases. Higher rates may impact their borrowing costs and dividend distributions. As a reminder, most of the S-REITs have gearing ratios (i.e. total debt/percentage of total assets) of c. 37%, below the regulatory limit of 50%. Further, S-REITs have, on average, also pegged more than 70% of their debt at fixed rates. Notably in this current rate hike environment, the sector (FTSE ST REIT Index) saw total returns of +6.4% from the year-low seen in late January.</li>
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 <img src='https://api2.sgx.com/sites/default/files/2022-05/Capture%202.PNG' alt='SREIT historical ' />
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 <div class='content-caption'>SREIT historical </div>


#whatstrending  Ever wondered what is currently driving the local and regional markets? This new report series address some of the most trending questions/topics on the markets for investors. Designed to be educational, expect to get factual information on what is driving sectors and stocks listed on SGX  Q: Singapore has announced further easing of border restrictions and stepped down DORSCON level from orange to yellow. How has this impacted the local equities market?  
Following the reopening of Singapore’s borders to all fully vaccinated travellers from 1 April 2022, Civil Aviation Authority of Singapore (CAAS) reported that air passenger traffic in Singapore reached 400,000 or 31% of pre-COVID levels in the week ending 17 April 2022, up from 18% a month ago. Transport Minister S Iswaran on 4 May stated Changi Airport passenger volumes has more than doubled to reach close to 40% of pre-COVID levels in end-April, up from 18% in March and on track to at least 50% of pre-COVID levels by this year.  
SIA also reported significant increase in passenger demand in its March operating results. The Group carried 893k passengers in March, a 792.1% YoY increase. Its group passenger capacity reached 51% of pre-COVID levels, and expects passenger capacity to reach 61% of pre-COVID levels by May 2022.  
We observed outperformance in the year-to-date for a number of reopening proxies including SATS, SIA, ComfortDelGro, Genting Singapore and SIA Engineering. These five stocks average total returns of 10.6%, outperforming STI’s +7.1% total returns YTD (as of 6 May ’22). On a funds flow perspective, these stocks saw a combined net institutional inflows of S$84.8 million in the YTD.  
The easing of measures also had an impact on the F&amp;B industry in Singapore. The top five actively traded SGX F&amp;B stocks with Singapore exposure are: Jumbo, Japan Foods, Pavillion, RE&amp;S and Kimly. Investors’ focus would be on Singapore’s F&amp;B service sales data for April.  
In the REITs Sector, SGX lists four stapled trusts and one REIT with significant exposure to Singapore hotels who may potentially benefit from reopening borders  - Ascott, CDL HT, Far East HT, Frasers HT, and OUE CREIT. These five trusts generated average total returns of 16.9% YTD (as of 6 May ’22). S-REITs with exposure to Singapore office assets as employees head back to office - Keppel REIT, CICT, Suntec REIT, MCT, and OUE CREIT.


      
    
    Mar 22 Changi Airport


Q: Rate hikes to combat inflation continues to be a focus on investors globally. How is this impacting the markets? Which are the sectors which may see direct impact?  
The 16 March FOMC rate hike was in-line with market’s expectations. At the recent May FOMC, the Fed raised rates by 50bps, with a 75bps hike at the next meeting ruled out for now. Quantitative tightening will begin, with the Fed allowing up to US$47.5 billion/month in combined US treasuries and mortgage-backed securities to run off the balance sheet, increasing to US$95 billion after 3 months  
Rates sensitive sectors such as Financials and REITs typically come into investors’ minds during rate hike/cut cycles.


Notably, Singapore Banks – DBS (D05), OCBC (O39), and UOB (U11) has seen an average 7.2% gains since the start of heightened volatility in the markets (8 March), outperforming global banks and the STI. In the same period, the FTSE ST All-Share Index also saw total returns of +5.7%. 
	 
	REITs depend on borrowings/debt to help finance their asset purchases. Higher rates may impact their borrowing costs and dividend distributions. As a reminder, most of the S-REITs have gearing ratios (i.e. total debt/percentage of total assets) of c. 37%, below the regulatory limit of 50%. Further, S-REITs have, on average, also pegged more than 70% of their debt at fixed rates. Notably in this current rate hike environment, the sector (FTSE ST REIT Index) saw total returns of +6.4% from the year-low seen in late January.




      
    
    SREIT historical 

Navigating global reopening and rate hikes

Research from SooChow CSSD Capital Markets (Asia), SCCM Asia Research

SCCM Asia Research

Research from SooChow CSSD Capital Markets (Asia)

Headquartered in Singapore, SooChow CSSD Capital Markets (Asia) is an investment bank focusing on emerging growth companies across Asia, providing a full suite of investment banking services, including corporate finance, mergers and acquisitions advisory, equity capital markets, institutional equities sales and trading and equities research.

SooChow CSSD Capital Markets (Asia)

Thematic (Sector/Industry)

<ul><li><a href="https://www.smartkarma.com/entities/suntec-reit" target="_blank" data-smartkarma-citation="entities:151" rel="noopener">Suntec REIT (SUN SP)</a> 1Q22 DPU +16.9% YoY; Reversions improving as retail rebounded</li><li><a href="https://www.smartkarma.com/entities/capitaland-china-trust" target="_blank" data-smartkarma-citation="entities:8859" rel="noopener">CapitaLand China Trust (CLCT SP)</a> 1Q22 Business Updates – New Economy assets cushioned weakness in Retail</li><li><a href="https://www.smartkarma.com/entities/ascendas-india-trust" target="_blank" data-smartkarma-citation="entities:935" rel="noopener">Ascendas India Trust (AIT SP)</a> 1Q22 Business Updates – Slowing reversions though occupancy remains steady at 87%</li></ul>

Suntec REIT (SUN SP) 1Q22 DPU +16.9% YoY; Reversions improving as retail reboundedCapitaLand China Trust (CLCT SP) 1Q22 Business Updates – New Economy assets cushioned weakness in RetailAscendas India Trust (AIT SP) 1Q22 Business Updates – Slowing reversions though occupancy remains steady at 87%

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Singapore

Suntec Real Estate Investment Trust is a commercial real estate investment trust. The Trust invests in income-producing real estate that is primarily used for retail and/or office purposes.

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