In our earlier primer of Temasek Holdings, we looked at some of their publicly listed equity holdings. With investments all over the globe and over a variety of industries, you could consider them as an investment holding conglomerate of sorts!
Today we will look at some of their holdings in Asia and since most of their publicly listed entities are held in Singapore (31% of their 2014 AUM was held in Singapore), we would break them down in that direction!
Many Are Among STI Constituents
The STI Index is the go-to index for a rough gauge of the Singapore market environment. And just among the factsheet above, we can see some familiar names!
But what was the reason for this?
As indicated in Temasek Review 2014, Temasek grew with successful Singapore icons such as the world famous Singapore Airlines and the Development Bank of Singapore (Now DBS Group) as well as having a stake in key telecommunication services such as SingTel. 40 years ago they were just small start-ups but successful compounding over 40 years would result in the powerhouses they are today!
And without further ado, here are some of Singapore’s legendary icons. Starting with the largest at 13% (31 Mar 2014) of Temasek’s portfolio:
Singapore Telecommunications Limited (SGX:Z74)
Singapore Telecommunications or better known as Singtel (Interesting fact: They lowercased the T in their new logo change!) with a market capitalization of over S$60 billion was the largest company within the 30 STI stocks!
For FY2014, Singtel had a net profit of S$3.6 billion; that’s like the revenue line for other companies! To put things into perspective, their direct competitors in Singapore StarHub Ltd (SGX:CC3) and M1 Ltd (SGX:B2F) had revenues of S$2.39 billion and S$1 billion respectively (Latest FY). That’s like woah.
So what does Singtel do?
To cut things short, Singtel strives to be Asia Pacific’s best multimedia solutions group. Singtel has a large operation base in both Singapore and Australia with total contributions of close to 54% of the Group’s EBITDA (A fancy financial term for a type operational cash flow).
Singtel is simply a communications service provider with a range of services including fixed, mobile, data, internet, television and many more. If you require a solution for some communication issues, odds would be that Singtel has some form of solution for you. As at 31 Mar 2014, Temasek had a 52% stake in Singtel.
Singapore Airlines Limited (SGX:C6L)
Singapore Airlines is the flag carrier of Singapore and has the brand name that is the envy of many carriers. I think that Singapore Airlines is an icon where almost everyone has heard of and would have no qualms about flying with them. This is one company where brand equity comes into play. As their famous slogan goes, “A great way to fly”.
Many people would know about their main carrier Singapore Airlines. However did you know that under them are 3 other brands and all of which have a different focus?
Let us show you the difference between the four:
- Singapore Airlines: Full service (Basically means that there’s food lol); Long Haul
- SilkAir: Full service; Short Haul
- Scoot: Low-cost; Long Haul
- Tiger: Low-cost; Short Haul
With this you might be able to save $ on your future trips 🙂
Temasek Holdings had a 56% stake in Singapore Airlines.
SMRT Corporation Ltd (SGX:S53)
For any Singaporean, SMRT is a household name. SMRT is a public transport operator in Singapore and in terms of size, they are 2nd only to ComfortDelGro Corporation Limited (SGX:C52).
Below Are Some of Temasek’s Other Holdings In The Telecommunications, Media & Technology and Transport & Industrial Sectors!
Value In Action
We hope that we have provided you with a more detailed understanding of what Temasek Holdings actually has within their portfolio. We felt that as a portfolio manager, a 16% return over the past 40 years is a record not to be scoffed at and there are things that we can definitely learn from how Temasek arrived at their investment decisions!
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We will only provide you with information relevant to value investing. You can unsubscribe at any time. Your contact details will be safeguarded.The information provided is for general information purposes only and is not intended to be any investment or financial advice.
All views and opinions articulated in the article were expressed in Mun Hong’s personal capacity and do not in any way represent those of his employer and other related entities. Mun Hong does not own any shares in the companies mentioned above.