Singapore’s Best-Performing Small Caps


It is probably safe to say that large-cap and mid-cap shares don’t generally double in the space of four months. But anything is possible down amongst the small caps.

Since the start of the year, the Straits Times Index (SGX: STI) has risen 200 points, which equates to an impressive 6% gain in four months. If the Singapore market can carry on at this rate, then we could be looking at a rise of around 20% for the benchmark index this year, which would be remarkable.

However, the gains in the Straits Times Index, whilst notable, pales in comparison to small cap Blumont Group (SGX: A33). Shares in the company jumped from $0.30 on 1 January to $0.80 on 30 April to register a gain of 167%. Blumont, which was formerly known as Adroit Innovations, operates in three distinct business segments. It provides sterilising and polymerising services for the food and packaging industry. It also has an investment arm and a property arm that develops buildings both for sale and for long-term rental.

Innopac Holdings (SGX: I26) has been another astonishing performer in the market this year. Its shares are up 163%. The company provides telecom services and also sells pre-paid international calling cards through its subsidiary PG Communications. In January, Innopac announced a S$76m takeover of Australia’s Merlin Diamonds to diversify its investment portfolio into natural resources.  The offer for the Australia-listed company closes on 28 June 2013.

Vegetable and fruit canning company Sino Grandness Food Industry (SGX: JS5) just missed joining the “100% club” by a whisker. Its shares were up 97% in the first four months of the year. Sino Grandness, which operates out of Shenzhen in China, floated on the Singapore market in 2009. Since then, turnover has more than trebled from S$93m to S$322m last year. The company, whose customers include European budget supermarkets Aldi and Lidl, has seen its profits quadruple from S$14m to S$57m in four years.

It is often said that elephants don’t gallop but fleas can jump over 200 times their own height. Clearly some market minnows have had a good start to the calendar year. But it always pays to tread more carefully with small caps because it is not like buying blue chips. They can be more volatile and there is a greater chance that they could do something unexpected, which may please but could also disappoint.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore Director David Kuo doesn’t own shares in any companies mentioned.