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It’s a Wrap: The Top 3 and Bottom 3 Blue-Chip Stocks for September

The Straits Times Index (SGX: ^STI), which tracks the performance of the top 30 largest and most liquid companies listed in Singapore, did not perform well for the month of September.

For the month, the local stock market benchmark slipped 1.7% to end at 3219.91 points on 29 September 2017.

Out of the 30 components, 26 were in the red; three were in the green, and one – Ascendas Real Estate Investment Trust (SGX: A17U) – was flat.

The three winners of the STI were Keppel Corporation Limited (SGX: BN4), Global Logistic Properties Ltd (SGX: MC0) and DBS Group Holdings Ltd (SGX: D05).

Source: S&P Global Market Intelligence; Author’s calculations

Following a Business Times article released in mid-September with the title, “KBS, Keppel Capital to jointly list REIT holding US offices”, Keppel Corporation Limited confirmed that it is looking into carrying out an initial public offering (IPO) to list a U.S. commercial real estate investment trust (REIT) in Singapore.

The REIT will be jointly sponsored by Keppel Capital Holdings Pte Ltd, a wholly-owned subsidiary of Keppel Corporation, and KBS Pacific Advisors Pte Ltd. The initial portfolio will consist of 11 office assets. Applications for the IPO have been submitted to the relevant authorities and they are under review.

Keppel Corporation will release the financial results for its fiscal third quarter on 19 October 2017.

On 28 September, DBS Group subscribed for 15 million ordinary shares of its wholly-owned subsidiary, DBS Bank Ltd, for an aggregate issue price of S$305.9 million. Following that, DBS Group holds 2.63 billion shares of DBS Bank.

On the other hand, the top three losers of the index were Comfortdelgro Corporation Ltd (SGX: C52), Capitaland Mall Trust (SGX: C38U) and Singapore Technologies Engineering Ltd (SGX: S63).

Source: S&P Global Market Intelligence; Author’s calculations

At the end of August, Comfortdelgro said that it would be tying up with Uber for a “potential strategic alliance” but nothing concrete has emerged so far.

For the second quarter ended 30 June 2017, revenue tumbled 3.4% year-on-year to S$987.2 million while net profit slipped 6.8% to S$79.4 million. All its business segments brought in lower sales except the Public Transport Services division and the Driving Centre division.

The company ended off its second quarter results announcement by saying that its “operating environment remains challenging”.

It will be interesting to watch how the third quarter pans out for the firm and if there are any updates on the potential tie-up with Uber.

The consortium of Singapore Technologies Engineering’s marine arm, Singapore Technologies Marine Ltd, and Tuas Power Ltd have been selected by Singapore’s national water agency PUB to design, build, own and operate a seawater desalination plant on Jurong Island for a concession period of 25 years from 2020.

It will be Singapore’s fifth desalination plant, adding around 30 million imperial gallons of desalinated water a day to Singapore’s water supply. For context, the amount would be enough to fill around 55 Olympic-size swimming pools per day.

The STI ETF (SGX: ES3), an exchange-traded fund which can be taken as a proxy for the Straits Times Index, was valued at 11.1 times trailing earnings and had a dividend yield of 3.1%, as of 29 September 2017.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended units of Capitaland Mall Trust. Motley Fool Singapore contributor Sudhan P owns units of Capitaland Mall Trust and STI ETF.