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Ask Me Anything: Navigating the Current Market Landscape
December 22, 2023
In this edition of our “Ask Me Anything” series, we tackle a range of pressing questions related to the current economic climate, focusing on government measures against inflation, the impact of energy market trends on key industries, and insights into specific real estate investment trusts (REITs). We also address the availability of our services in Indonesia and provide guidance on investment decisions in tech giants like Meta Platforms Inc. (NASDAQ: META).
1. Singapore government’s measures against inflation
The Singapore government has taken various measures to manage rising inflation, such as:
Providing a comprehensive set of support measures for Singaporeans to cope with higher costs of living, including cash payouts, vouchers, subsidies, and GST rebates.
Enhancing the Assurance Package to cushion the impact of the GST increase for all Singaporeans, especially the lower-income and elderly groups.
Calibrating the foreign worker policy to ensure that foreign workers and professionals coming into Singapore are of the right calibre and come in areas where there are shortages.
Implementing cooling measures for the housing market to lower the loan-to-value and total debt-servicing ratios and raising additional buyers’ and seller’s stamp duties.
2. Energy market trends and impact on Sembcorp Industries
Short-term fluctuations in oil and natural gas prices could impact Sembcorp Industries Ltd (SGX: U96)’s earnings.
However, its strategic shift towards renewable energy, with recent acquisitions totalling 673MW in Vietnam, China, and India, set a course for sustainable growth.
Sembcorp plans to invest S$14 billion between 2023-2028, aiming to expand its renewable capacity to 26GW, reduce greenhouse gas emissions intensity, and achieve net-zero emissions by 2050.
3. How negative outlook in China affect Keppel Corporation?
Despite China’s economic uncertainties, Keppel Corporation Limited (SGX: BN4)’s acquisition of Aermont Capital highlights its proactive approach to diversification.
This move not only mitigates short-term risks associated with the Chinese market but also paves the way for long-term growth in Europe and potentially Asia.
4. What is your long-term and short-term view on Ho Bee Land and ESR REIT?
ESR-LOGOS REIT (SGX: J91U)
ESR-LOGOS REIT, or ELOG for short, exhibits strong short-term financial performance with increased gross revenue and NPI in 9M FY2023.
The significant rental growth, especially in logistics and business parks, along with high occupancy rates, indicates robust demand.
However, a moderate gearing level of 37.7% and rising funding costs require vigilance.
Long-term prospects are favourable, with opportunities for growth through strategic acquisitions and property improvements.
Ho Bee Land Limited (SGX: H13)
Ho Bee Land’s share price has been on a downtrend since April 2022, falling from S$3.00 level to its current price of around S$1.77.
This was partly influenced by recent losses attributed to lower rental income and impairment losses.
Despite near-term economic challenges, Ho Bee Land’s diverse portfolio offers potential for long-term recovery and growth.
5. Will you provide service in Indonesia?
Not at the moment but we will look into it if there are more requests from you guys.
6. Should I hold on to Meta or sell and book profit now before 2024?
Investors contemplating whether to hold or sell Meta Platforms Inc. (NASDAQ: META) shares before 2024 should consider:
Meta’s strong performance in 2023 was mainly due to the recovery from the sharp decline experienced in 2022.
The company is trading at a fair valuation with a forward price-earnings ratio of around 20 times, which is below the tech industry average.
Upside potential from successful AI and Metaverse innovations.
Meta’s resilient business model, underpinned by its dominance in social media and strong operating cash flow.
Risks related to the US Presidential Election in 2024 and its potential impact on the company’s social media management.
We are excited to have addressed some of these questions from our members, and our aim for this article is to deliver a straightforward and succinct summary of the varied and intricate factors influencing the current market environment.
Our goal is to provide clarity and direction to both individuals and businesses as they tackle these challenges.
We eagerly look forward to the next AMA session, where we’ll continue to explore and discuss important economic trends and opportunities.
Disclaimer: ProsperUs Head of Content & Investment Lead Billy Toh doesn’t own shares of any companies mentioned.
Billy is deeply committed to making investment accessible and understandable to everyone, a principle that drives his engagement with the capital markets and his long-term investment strategies. He is currently the Head of Content & Investment Lead for Prosperus and a SGX Academy Trainer. His extensive experience spans roles as an economist at RHB Investment Bank, focusing on the Thailand and Philippines markets, and as a financial journalist at The Edge Malaysia. Additionally, his background includes valuable time spent in an asset management firm. Outside of finance, Billy enjoys meaningful conversations over coffee, keeps fit as a fitness enthusiast, and has a keen interest in technology.