Top five Singapore blue chip stocks of 2019

This past year was marked by violent protests, trade wars, a burning forest, globally-charged local elections, high-profile initial public offerings, and an impeachment trial; it has been nothing short of a miracle that 2019 turned out to be as lucrative as it did for so many public companies globally.

Here in Singapore, of the 80 locally-listed companies possessing a market capitalisation of US$10 billion and more, a total of 59 firms – or 74% - saw their share price increase in 2019.

Below are the top five performing Singapore-listed large-cap companies – in terms of stock value – for the year 2019, based on data from financial research firm Refinitiv as of 30 December. We take a look at why and how their equities were able to stay profitable.

1. Thai Beverage Public Company Limited (SGX: Y92) +47.1%

If you’re a beer drinker, chances are you would have heard of Chang Beer, a brand that is manufactured and distributed by the Singapore Exchange-listed Thai Beverage Public Company Limited (ThaiBev).

The company is the second top performing Singapore stock overall this year, and the number one large cap trade, with a 47.1% increase in share value year-to-date, as of 30 December 2019.

Share price rose from S$0.61 per share at the start of the year, to its current level of S$0.90 per share. In the process, ThaiBev was able to increase its market capitalisation by well over two billion Singapore dollars, an impressive feat for a company of its size.

On the top line, it recorded a net profit of S$1.17 billion for the whole year, an increase of 46% from 2018. Dividends also grew from 0.71 Thai baht in 2018 to 0.93 Thai baht this year.

In November this year, rumours that the company was planning an initial public offering of its brewery unit next year made the rounds in local media, which it promptly dispelled.

Following those reports, ThaiBev’s trade volume increased 875% on the IG platform.

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Thai Beverage was rumoured to be planning an IPO of its brewery unit in 2020 (Source: Bloomberg)

2. Wilmar International Limited (SGX: F34) +31.9%

Agricultural business group Wilmar International Limited, which produces palm oil and sugar, saw share price rise by over 30% this year, from S$3.13 per share in January, to S$4.13 per share as of 30 December.

The company, which currently has a market cap of S$26.45 billion, managed to break through the four-dollar resistance band in July, its highest level in more than seven years.

Analysts expect that form to carry over into 2020, with RHBInvest’s Juliana Cai giving Wilmar stock a ‘buy rating’, alongside a price target of S$4.75 per share.

A lot of this investor confidence was influenced by the impending flotation of its China subsidiary Yihai Kerry Arawana Holdings on the Shenzhen stock exchange, which Cai noted would also cause Wilmar’s share price to be re-rated. Chinese regulators had in July accepted Wilmar's initial application to list Yihai Kerry, subject to approval later.

3. CapitaLand Limited (SGX: C31) +22.1%

One of IG’s busiest equity offerings in terms of trade volume, CapitaLand Limited opened the year at S$3.07 per share, before hitting a 52-week high point of S$3.75 around Christmas Day, representing a year-to-date gain of 22.1%.

Investors were able to draw much assurance from the real estate group's shift in business approach. On this front, 2019 has been an especially busy year for the company, as it sold off S$5.7 billion worth of assets as part of a ‘asset recycling strategy’.

Earlier this year, the company divested several properties globally, including three malls across China in June, and the Main Airport Centre in Frankfurt a month later.

Then in December, the group sold off Singapore entertainment and leisure hub The Star Vista to Rock Productions for S$296 million.

The sale was estimated to have netted the group a profit of approximately S$32 million.

As a result of those divestments, CapitaLand Limited was able to acquire S$2 billion worth of new assets, as well as release S$2.4 billion of net capital back toward operations.

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CapitaLand Limited saw share price grow by 22.1% in 2019 (Source: Bloomberg)

4. Singapore Telecommunications Limited (SGX: Z74) +16%

Singapore Telecommunications Limited (Singtel) was another steady performer this year, as it accumulated a solid 16% in share price gain from the start of the year.

Singtel stocks were a beneficiary of the global trade uncertainty from earlier in the year, as noted by DBS analyst Sachin Mittal. He said shares were ‘driven by the market’s search for yield and defensive stocks in the wake of global economic and trade woes’.

Share price however did take a big tumble in October, after it was reported that the blue-chip firm was planning to cut its dividend rate for the first time in 20 years to between 13 to 15 cents a share.

Prices then recovered slightly, before another small drop in mid-November, during which the company reported a net loss of S$668 million for Q2 of the 2020 fiscal year, attributing it to a ‘weak global economic environment’.

Since then, prices have managed to inch back up close to this year’s peak price of S$3.40 per share, thanks to a recent partnership with internet company Grab. Both companies have combined forces to apply for a digital banking licence (with Singtel taking a 40% stake), the first of its kind in Singapore.

5. DBS Group Holdings Limited (SGX: D05) +10.4%

With a market capitalisation of S$66 billion as of 30 December, DBS Group Holdings Limited remains Singapore’s most valuable company by far.

Consistently among the top three most traded stocks on IG, DBS Group saw its share price grow 10.4% in 2019, with a 52-week peak of S$28.64 in April.

A lot of this growth can be attributed to what has so far been a profitable 2019, with nine-month earnings up 13% to S$4.88 billion for the first three quarters of the financial year, as compared to 2018.

The company also continues to be one of the top financial institutions in the world, having being named the world’s best bank by Euromoney magazine in July this year.

As a result of that honour, DBS Group became the first bank in the world to concurrently hold three global best bank awards, another remarkable feat in itself.

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