You may not have noticed the world economy is slowing down by the pandemic and the Ukraine-Russia war. Investors are scrambling to find a haven for their investments. Hoarding cash is not a good option as inflation depreciates its purchasing value.
“Keep investing!” Some may scratch their jaws at this. Yet, stocks are still the best investment tool to fight unfortunate occurrences worldwide. The billionaire, Mr. Warren Buffett, urges investors not to change the course. He advocates investing in the long term. Read more on the best stocks to invest in Singapore.
Not every stock qualifies for long-term investing. Blue-chip stocks have the characteristics of sustainable profits, significant market share, and consistent dividend payouts. Besides, they bring stability and further appreciation for stockholders through one or all of the above.
The following 10 stocks in Singapore can give you some tips on investing in blue-chip companies.
1. DFI Retail Group Holdings Limited(D01)
Formerly known as the dairy farm international holdings limited and a member of Jardine Matheson Group, DFI is a pan-Asian retailer operating in 5 segments, including food, health and beauty, home furnishing, restaurant, and other retailing. The business activities of 10,285 retail outlets extend across 12 Asian markets.
The food segment comprises supermarkets and hypermarkets under various brand names such as Wellcome, Yonghui, CS Fresh, MarketPlace, and convenience stores under the 7-Eleven brand.
The group has brands like Mannings, Guardian, and GNC under its management regarding health and beauty. Besides, DFI runs a home furnishing business under the IKEA brand name and restaurants like Maxim’s catering.
- Based in Hong Kong, DFI has a market cap of USD3.8 billion, and the group’s revenue for 2021 is USD9 billion.
- The essential ratios(for reference only) for DFI are the below:
- P/E(price-to-earning): 37; P/B(price-to-book): 3; trailing dividend yield: 3.38%
The 3 banks form the central economic pillars of Singapore. We group and discuss them in a category due to their similarities in business and financial strengthSingapore’s
Established in 1968 and headquartered in Singapore, the banking group provides comprehensive financial services in Singapore and the Asia Pacific: Hong Kong, Greater China, South Asia, and Southeast Asia. DBS operates 4 business segments: consumer banking/wealth management, institutional banking, treasury markets, and Islamic banking.
DBS acquired POSB(the post office savings bank) in 1998 and enlarged its client base to 4 million. The POSB focuses on the domestic banking business.
- The banking group has a market cap of SGD79 billion, and its revenue for 2021 is SG14 billion.
- The essential ratios(for reference only) for DBS are the below:
- P/E: 12; P/B: 1.37; trailing dividend yield: 4.65%
Overseas Chinese Banking Corporation, incorporated in 1932, offers 5 banking services: consumer banking, business banking, international banking, global treasury, and investment management services. OCBC broadens various financial services through acquisitions, such as Keppel Capital Holdings Limited, specializing in securities, finance, and banking services.
OCBC has assets of SGD151 billion under management and more than 370 branches and representative offices in 15 countries. Besides, the bank holds PT Bank NISP in Indonesia, providing diversified financial services to customers.
- The banking group has a market cap of SGD54 billion, and its revenue for 2021 is SG7.4 billion.
- The essential ratios(for reference only) for OCBC are the below:
- P/E: 11.12; P/B: 1.02; trailing dividend yield: 4.45%
Founded in 1935, United Overseas Bank is Singapore’s 3rd largest local bank. Like the former Singapore banks, UOB provides diversified banking and other financial services to meet clients’ various needs. The services offered include personal financial services, private banking, trust services, commercial and corporate banking, investment banking, corporate finance, capital market activities, treasury services, asset management, venture capital, stockbroking, and personal and corporate insurance services.
Besides, the banking group expands its businesses beyond financial services like travel, property development, management, hotel, and trading. UOB has 502 offices in 18 countries worldwide.
- The banking group has a market cap of SGD48 billion, and its revenue for 2021 is SG8.2 billion.
- The essential ratios(for reference only) for UOB are the below:
- P/E: 12.02; P/B: 1.12; trailing dividend yield: 4.19%
3. Singapore Telecommunications Limited(SingTel)(Z74)
Listed on the Singapore Exchange in 1993, SingTel, over its history of 140 operating in Singapore, provides 3 telecommunications and digital services to the market: group consumer, group enterprise, and group digital life. Singapore Telecommunications Limited also has stakes in Southeast Asia operators, like AIS Thailand, Globe in the Philipines, Telkomsel in Indonesia, and Bharti Airtel in India.
With its wholly-owned subsidiary, Optus in Australia, Singtel is the second carrier in the market. It also has an 82% market share in the fixed-line sector, 47% in the mobile market, and 42% in the broadband market in Singapore and extends its services to 700 million people in 21 countries.
Through its subsidiary SingTel Inno8, SingTel is actively seeking to invest in technology companies. Today, the telecommunications company has its infrastructure and technology service for businesses and has a footprint in 362 cities.
- The telecommunications group is the second-largest listed corporation with a market cap of SGD42.6 billion, and its revenue for 2021 is SG15.339 billion.
- The essential ratios(for reference only) for SingTel are the below:
- P/E: 21.92; P/B: 1.5; trailing dividend yield: 3.61%
4. Singapore Technologies Engineering Limited(ST Engineering)(S63)
Incorporated in Singapore and listed on the Singapore exchange in 1997, the company is a global technology, defense, and engineering company with worldwide offices. Serving clients in more than 100 countries, ST Engineering has 3 business segments: commercial aerospace, urban solutions & Satcom, and defense & public security.
The company offers services like repair and maintenance to commercial airplanes through technology and innovative engineering. Besides ST Engineering, it also provides mobility, infrastructure, utilities, urban environment solutions, public security, defense, and critical information infrastructure.
Providing services to commercial clients and government and defense sectors, the company is one of the largest capitalization groups on the stock market. It is a component company of the FTSE Straits Times Index, MSCI Singapore, iEdge SG ESG Transparent Index, and iEdge SG ESG Leaders Index.
- Singapore Technologies Engineering Ltd has a market cap of SGD13 billion, and its revenue for 2021 is SG7.7 billion.
- The essential ratios(for reference only) for S63 are the below:
- P/E: 22.92; P/B: 5.38; trailing dividend yield: 3.36%
5. Singapore Exchange(S68)
Singapore Exchange Limited, incorporated in 1999, operates integrated securities and derivatives exchange and clearing houses in Singapore. It offers 3 primary segment services: equities, fixed income & currencies & commodities, and data, connectivity & indices.
The equities section renders securities, derivatives issues, trading, clearing, settlement, depository management, and collateral management services related to derivatives.
The fixed-income section offers new issues, trading, clearing, and collateral management services.
Besides, the Singapore exchange also provides comprehensive professional services, for example, counterparty guarantee, depository services for securities transactions, bond trading services, front-line regulatory functions, operating an electronic foreign exchange trading platform, and management consultancy services for index activities.
The data section supplies market data, connectivity, and indexes services.
The business scope extends to corporate membership activities and management of bulk freight market information, indexes, and operates an electricity market. The exchange offers professional administration services, e.g., financial research, index calculation, and risk analyses. The company works with New Zealand Exchange on dairy derivative market operations internationally.
- The Singapore Exchange has a market cap of SGD10.36 billion, and its revenue for 2021 is SG1 billion.
- The essential ratios(for reference only) for S68 are the below:
- P/E: 25; P/B: 7.32; trailing dividend yield: 3.29%
6. Thai Beverage Public Company Limited(TaiBev)(Y92)
Established in Bangkok, Thailand, in 2003, ThaiBev is the leading international producer and distributor of alcoholic and non-alcoholicSingapore beverages and food products. The liquor output is diverse, including liquor, beer, cardinals, malt, and yeast products, and the spirits products include brown and white spirits besides general spirits and herbs.
ThaiBev also produces non-spirits drinks, e.g., drinking & soda water, electrolyte & energy drinks, green & herbal tea, instant coffee, carbonated soft & isotonic, soya, and sparkling beverages. The milk series comprises pasteurized, UHT, sterilized, canned milk, refined products like yogurt, ice cream, pasteurized & ready-to-go juice, and cereal bars. ThaiBev also engages in the frozen food business and operates product-related companies such as distribution, transportation, and logistics.
Besides the beverage businesses, ThaiBev expands its operations to catering and packaging services. Beyond traditional industries, the company operates in e-commerce, asset management, property development, and mechanical equipment manufacturing and development businesses.
- Thai Beverage has a market cap of SGD17.2 billion, and its revenue for 2021 is SGD10.1 billion.
- The essential ratios(for reference only) for Y92 are the below:
- P/E: 16.19; P/B: 2.43; trailing dividend yield: 2.66%
7. Singapore Airlines Limited(SIA)(C6L)
Founded and based in Singapore in 1972, Singapore Airlines is notable for being “The World Best Airline” by the Skytrax 4 times and the best airline by Travel & Leisure for 20 years.
With its affiliates, SIA provides passenger and cargo air transportation services under the brand names: Singapore Airlines, SilkAir, and Scoot(a low-cost carrier) worldwide.
Besides freight services, the group offers engineering and pilot training services, air charter, tour wholesaling, and airport galley refurbishing services. Another core activity is aircraft maintenance services, including maintenance, repair, the overhaul of cabin components/systems, and hydromechanical equipment.
Like other airlines, Singapore airlines suffered revenue and income loss over the past 2 years due to the halt of worldwide air operations caused by the pandemic. With the support from the majority holder of Singapore Temasek Holdings Limited and its strong balance sheet, the airline’s business has been recovering since the gradual opening of international borders this year.
- Singapore Airlines has a market cap of SGD15.96 billion, and its revenue for 2021 is SGD7.6 billion.
- The essential ratios(for reference only) for C6L are the below:
- P/E: N/A; P/B: 0.72
8. Ascendas Real Estate Investment Trust(A17U)
Ascendas is one of the largest REITs listed on the Singapore Stock Exchange in 2002. Its portfolio primarily consists of business space and industrial estates. The REIT has more than 200 properties under management in Singapore, Australia, the United Kingdom, and the United States. Read more on how to invest in REITs.
The properties under management include science and business parks, suburban office properties, high-specification industrial properties, logistics & distribution centers, integrated developments, and amenities & retail properties.
The portfolio tenants come from different countries besides Singapore and various industries: for example, research & development, life science, information technology, logistics service providers, light manufacturing, engineering, electronics, telecommunications, manufacturing services, and back-room support for service industries.
Ascendas REIT is a component of primary indexes like the FTSE Straits Time index, the Morgan Stanley Capital International Inc. Index(MSCI), the Global Real Estate Index, and the Global Research Asia 250.
Ascendas Funds Management(Singapore) Limited is the property manager, a wholly-owned subsidiary of the Singapore-listed CapitaLand company.
- Ascendas has a market cap of SGD11.92 billion, and its revenue for 2021 is SGD1.23 billion.
- The essential ratios(for reference only) for A17U are the below:
- P/E: 12.46; P/B: 1.16; trailing dividend yield: 4.71%
9. CapitaLand Integrated Commercial Trust(C38U)
CapitaLand is the largest listed REIT in Singapore. The integrated trust comprises various properties, e.g., urban development, lodging, residential, business parks, industrial & logistics, integrated development, and commercial & retail properties.
Properties under the group spread to more than 30 countries focusing on Singapore and China. CapitaLand also invests in other real estate investment trusts in Singapore like Ascendas. The portfolio is under the management of CapitaLand integrated commercial trust management limited, a wholly-owned subsidiary of the trust.
- CapitaLand has a market cap of SGD14.85 billion, and its revenue for 2021 is SGD1.3123 billion.
- The essential ratios(for reference only) for C38U are the below:
- P/E: 13.44; P/B: 1.08; trailing dividend yield: 3.89%
10. HongKong Land Holdings Limited(H78)
Established, as a subsidiary of Jardine Strategic Holdings Limited, in 1889 and registered in Hamilton, Bermuda, HongKong Land operates through 2 segments: investment properties and development properties. The group engages in office properties like the Marina Bay Financial Centre in Singapore and luxury retail assets such as the Marina Link Mall and residential properties, for instance, the Marina Bay Suites and the Marina Bay Residences.
Besides Singapore, HongKong Land has developed its businesses across Hong Kong, Macau, China, other South East Asia region, and internationally.
- The HongKong Land has a market cap of USD11.28 billion, and its revenue for 2021 is USD2.38 billion.
- The essential ratios(for reference only) for H78 are the below:
- P/E: n/a; P/B: 0.33; trailing dividend yield: 4.39%
How to Start Investing in Singapore Blue Chip Stocks
If you are interested in investing in the Singapore blue chips, you can follow the following easy steps below:
You should research and pick stocks suitable to your personal goals and risk acceptance. A financial advisor is a good choice in choosing your favorite picks.
Set up a CDP account
A central depository account is necessary to store your stocks, even though some financial institutions may provide custodian services. An advantage of a CDP account with the Singapore stock exchange is you may transfer your stocks to a CDP account if you change a brokerage.
Open a brokerage account
Although most brokerages have registered with the Monetary Authority of Singapore, you should not skip checking your brokerage’s legal status. Furthermore, regular reviews on your brokerage ensure your assets are safe while investing.
Now you start buying the stocks after funding your account. But you should also beware of the stock market volatility whether you buy the Singapore blue chips or others. You should find the best price and hold for a significant time to benefit from your investments like dividends and capital gains.
Singapore blue-chip stocks offer investors, especially beginners, more stability, and some offer regular income streams. However, investing involves risks like market volatility and price fluctuations. You should research and consult your financial advisor before investing.
- Blue-chip stocks prove relative price stability, and some offer regular income streams.
- Stock investing involves risks.
- Do homework and consult your financial advisor before making investing decisions.
- A CDP account with the Singapore stock exchange is a good standby choice even if your financial institution offers custodian services.
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