Singapore Equity Picks
- TWRR since inception, slipped to 138.1%
- 12-mth return of 10.6% outperformed STI’s 2.5%
- 14 Mar 2023 - CapitaLand Ascott Trust: Increase 7,000 shares @ S$0.995 to Dividend
- 14 Mar 2023 - ST Engineering: Add 6,000 shares @ S$3.36 to Growth
- 21 Mar 2023 - Venture Corp: Increase exposure by 400 shares @ $16.57
As of 22 Mar 2023
Key facts
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Current DBS Equity Picks
As of 22 Mar 2023
DIVIDEND:Provides steady income stream
GROWTH:Provides capital growth over 12 month
The return of interest rate woes alongside market volatility weighed on returns over the past month. Our portfolio’s time-weighted rate of return (TWRR) since inception slipped slightly to +138.1% from a record +144.4% seen last month. The 10.6% return over the past year continued to outperform the STI’s +2.5%.
We raised our stake in Nikko STI ETF to capitalise on STI’s near-trough valuation of 10.8x (-2.5SD) 12-mth forward PE, despite having +11.6% FY23F EPS growth. We see base support at 3,194, implying <1% downside from the current level of 3,214.
We added CapitaLand India Trust and increased our position in HPH Trust, given their firm fundamentals and strong FY23F/24F yields. We also received dividends from these stocks in February.
We took profit on SIA Engineering and Raffles Medical following their earnings releases. We also closed our tactical position on UMS Holdings, as it breached our stated support level and reported lower-than-expected FY22 earnings.
We continue to adopt a proactive stance in monitoring our current stockholdings and will act as opportunities arise or when risks appear.
22 Mar 2023 - Singapore Airlines: Reduce exposure by 1,700 shares @ $5.69
Our exposure into SIA shares have returned 10.7% (cum 10cts interim dividend). We lower our exposure to the stock by one-third. Post reduction, we still have 3,300 shares at an amalgamated entry price of $5.228.
21 Mar 2023 - Venture Corp: Increase exposure by 400 shares @ $16.57
Venture Corp is our pick in the technology downstream segment. While the stock is not immune to a macroeconomic slowdown in the near-term, it’s less affected than peers given its exposure to higher end consumer products where demand is less volatile. We capitalize on the stock’s recent sell-off by adding exposure at near technical support at $16.38 to $16.50 as the stock heads closer to its XD date on 8 May with a final dividend of $0.50.
14 Mar 2023 - ST Engineering: Add 6,000 shares @ S$3.36 to Growth
We add ST Engineering (STE) following the recent share price correction. DBS aviation analysts remain upbeat on the aviation sector’s earnings/recovery prospects despite macroeconomic concerns. Improved core operating profits through TransCore and commercial aerospace segment should more than offset the increase in finance costs. STE is our preferred pick in the Singapore aviation sector with (i) earnings expected to grow at a solid 14% CAGR over the next two years, and (ii) undemanding valuation at a forward P/E of 18.6x (around -1.2 S.D. of the average).
14 Mar 2023 - CapitaLand Ascott Trust: Increase 7,000 shares @ S$0.995 to Dividend
We raise our exposure to CapitaLand Ascott Trust (CLAS) following the sharp pullback in 10YUST yields. DBS property analysts see the hospitality sub-sector as the dark horse this year; it is expected to deliver FY22-24F DPU CAGR of 16%, with rental growth to outpace inflationary pressures for FY23F-24F. Forward yields of 6.5% in FY23F and 7.1% in FY24F are above sub-sector average and peers. CLAS remains our top pick in the hospitality space. We have a total of 22,000 shares after today’s inclusion.
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