The Singapore Market this Week: Jardine Cycle & Carriage Ltd Takes a Huge Beating

The local stock market bellwether, the Straits Times Index (SGX: ^STI), did not have a spectacular week over the past five days. It saw a 3.5% drop, or a decline of around 102 points, to end Friday’s trading session at 2,839 points.

Of the index’s 30 constituents, only three stocks managed to clock a weekly gain, while the rest were in the doghouse. Jardine Cycle & Carriage Ltd (SGX: C07) was the biggest loser, as it pared down 12% to S$38.62.

The automotive group posted its financial results for the three months ended 31 March 2016 on Thursday. Revenue came down 9% year-on-year to US$3.7 billion, while net profit fell by a larger 20% to end the quarter at US$140.6 million.

The main reason cited for the poor showing was “reduced earnings from Astra which faced challenging market conditions in Indonesia”. Astra is the largest independent automotive group in Southeast Asia and is 50% owned by Jardine Cycle & Carriage.

Two banks that released its first quarter results this week were in the red too. United Overseas Bank Ltd (SGX: U11) and Oversea-Chinese Banking Corp Limited (SGX: O39) saw its share prices go down more than 5% each to S$18.60 and S$8.77, respectively. You can read up on their quarterly earnings here and here. The third bank that is part of the STI, DBS Group Holdings Ltd (SGX: D05), will be making public its first-quarter results in the coming week, on Tuesday.

But onto the winning side of the STI. Commodity firm, Wilmar International Limited (SGX: F34), was the biggest gainer in the index, putting on 4.2% to S$3.71.

The company concluded its Annual General Meeting for the Financial Year ended 31 December 2015 on 28 April 2016. It announced that all the resolutions were duly passed upon conclusion of the meeting.

For the financial year, Wilmar’s revenue fell 10% year-on-year to US$38.9 million, while its net profit came down 8.7% to US$1.1 billion. The main reason cited for the poor performance was weakness in the Tropical Oils business segment.

Despite the above, the firm is confident that its resilient business model and vertical integration, supported by its healthy balance sheet, will bode well for the future. Shareholders may be offered a little more clue about Wilmar’s future when it releases its earnings for the first quarter ended 31 March 2016 on 10 May 2016 after market closes.

Elsewhere, shares of transport firm, SMRT Corporation Ltd (SGX: S53), added 1.3% to S$1.53, after announcing a positive set of financial results for the year ended 31 March 2016. During the period, top line grew 6.2% year-on-year to $1.3 billion while the bottom line saw double-digit percentage growth to $$109.3 million.

The SPDR STI ETF (SGX: ES3), an exchange-traded fund, which can be taken as a proxy for the Straits Times Index, is now valued at 11.6 times trailing earnings and has a dividend yield of 3.5%.

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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 contributor Sudhan P doesn’t own shares in any companies mentioned.