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What Investors Should Know About Jardine Strategic Holdings Limited’s Strategic Developments

Jardine Strategic Holdings Limited (SGX: J37) or JSH is a conglomerate with interest in the web of Jardines companies which include Jardine Cycle & Carriage Ltd (SGX: C07), Hongkong Land Holdings Limited (SGX: H78), Jardine Matheson Holdings Limited (SGX: J336) and others.

The company recently published its annual report for the year ending 31 December 2017.  Reading an annual report is one of the best ways to keep up with a company’s developments. With that in mind, I decided to go through Jardine Strategic’s latest annual report to understand the company’s prospects, and how it had performed in 2017.

When I read an annual report, I tend to pay close attention to the letter to shareholders that the company’s chairman or CEO writes. Today, we will look at an area that I found interesting: the company’s strategic developments in 2017.

As a conglomerate, Jardine Strategic has invested its capital into different industries or regions over the years, both in its own businesses, or through in other companies that it owns. Similarly, it allocated its capital into various ventures in 2017.

Here we will look some of these ventures highlighted by its chairman, Sir Henry Keswick.

Mainland China

“Mainland China continued to grow in importance for the Group, with its contribution to profits increasing to 15%.

In this market, Hongkong Land’s residential developments achieved an excellent result, while Zung Fu and affiliates Zhongsheng and Yonghui each had a very good year. A 28% shareholding was taken in Greatview, the second-largest supplier of aseptic carton packaging in China.

Hongkong Land secured five further development projects in mainland China during 2017, including in the new markets of Wuhan, Nanjing and Hangzhou. The retail component of its luxury retail and hotel complex in Beijing, WF CENTRAL, was opened in late 2017. In January 2018, Hongkong Land secured a prime commercial site in Nanjing city centre, which has a developable area of 235,000 sq. m.”

South East Asia

“In Southeast Asia, Jardine Cycle & Carriage continued to build its business interests, acquiring a 10% shareholding in Vinamilk, the leading dairy producer in Vietnam with a market share of some 58%.

Hongkong Land secured further development projects in Singapore and Vietnam, together with a joint-venture interest in a prime freehold site in Bangkok.

Astra in Indonesia is expanding its operations further with investments in toll roads, energy and property. In February 2018, Astra acquired a minority stake in GO-JEK,Indonesia’s leading multi-platform technology group.”

Key takeaway

For me, the key takeaways from the above are:

  1. Jardine Strategic is focused on investing and growing its businesses around the Asia region. The growing importance of China in its profits highlights the Middle Kingdom’s role in the conglomerate’s expansion.
  2. Hongkong Land, the conglomerate’s property arm, had a good year in 2017 with its various new development projects in China, Singapore, Vietnam and Thailand.

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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 Lawrence Nga doesn’t own shares in any companies mentioned. Motley Fool has a recommendation for Hongkong Land Holdings Limited.