Blue-chip companies are well-known for their stability and resilience.
However, not all such companies are built alike.
Some may see their business floundering while others may experience stagnant revenue or profits.
That’s why it’s important to look for catalysts, even when investing in large, reputable businesses.
These catalysts may come in the form of a strong recovery from a downturn, acquisitions that help to power growth, or strategic initiatives that enable the business to build for the future.
Patience is also a necessary ingredient for successful investing.
Time is needed for these catalysts to come through and lead to an increase in revenue and profits.
Here is a list of three blue-chip companies that you can add to your investment watchlist.
SIA Engineering Company Ltd (SGX: S59)
SIA Engineering Company Ltd, or SIAEC, is a line maintenance and fleet management specialist that also conducts maintenance, repair and overhaul (MRO) on aircraft.
The company’s line maintenance division covers 26 airports in seven countries while its fleet management division includes 77 aircraft from nine airlines.
The group has reported a much better operating performance for its fiscal 2022 first half (1H2022).
Revenue increased by 18.2% year on year to S$263.5 million while operating loss narrowed significantly to just S$6.7 million from S$27.2 million a year ago.
After adding a share of profits from its associates and joint ventures, SIAEC reported a net profit of S$25 million, reversing the S$19 million net loss last year.
The stronger performance came about due to higher flight activities as Singapore Airlines Limited (SGX: C6L) started ramping up flights as more vaccinated travel lanes were introduced.
The number of flights handled surged by 84% year on year to 20,745.
Meanwhile, maintenance checks at its Singapore base also grew substantially year on year due to active marketing efforts.
Light checks jumped from 109 to 162 while heavy checks nearly doubled year on year from 24 to 46.
SIAEC is also progressing well on phase two of its three-year transformation journey.
The MRO specialist plans to invest up to S$40 million in LEAN manufacturing and digital product development.
Earlier this month, the group also announced a senior management appointment, with Mr Ivan Neo retiring as executive vice president of operations and Mr Foo Kean Shuh succeeding him.
Sembcorp Industries Limited (SGX: U96)
Sembcorp Industries Limited, or SCI, is an energy and urban solutions provider.
The group has a balanced energy portfolio of over 12,800 megawatts (MW), including more than 3,300 MW of renewable energy capacity such as solar, wind, and energy storage.
SCI has been actively growing its renewables installed base since it committed to achieving 70% of its operating profit from sustainable solutions back during its Investor Day briefing.
In late October, the group was awarded a 180 MW wind power project in India.
The new development will be situated in the state of Karnataka and once completed, its power output will be sold to the Solar Energy Corporation of India under a 25-year power purchase agreement.
And in another win the same month, SCI will partner with Batam’s utility company PT PLN Batam and Suryagen to develop one gigawatt (GW) of solar power in Indonesia’s Batam, Bintan, and Karimun regions.
The group followed these two projects by announcing one in China this month, this time for 658 MW of operational wind and solar assets.
SCI signed an agreement to acquire 98% of this portfolio at a cost of around S$700 million.
The blue-chip utility group has been making impressive progress in building up its renewables portfolio, and investors can look forward to more of such deals in the coming months.
Singapore Exchange Limited (SGX: S68)
Singapore Exchange Limited, or SGX, is Singapore’s sole stock exchange operator.
The group enjoys a natural monopoly and pays out a steady quarterly dividend of S$0.08 per share.
During its Investor Day in June, SGX highlighted that it was in a “sweet spot” to enjoy growth as it continues its transition to become a successful multi-asset exchange.
Since then, the bourse operator has taken on multiple initiatives to build on these objectives.
One such move involved a partnership with United Overseas Bank Ltd’s (SGX: U11) asset management arm to launch a yield-focused iEdge-UOB APAC Green REIT index.
This index tracks REITs across Asia-Pacific that have higher dividend yields and positive environmental attributes.
SGX is also collaborating with the Shanghai Stock Exchange’s subsidiary to bring securities market data to investors in mainland China.
The exchange operator has also released guidelines for the listing of special purpose acquisition companies (SPACs) and may see its very first SPAC listing occurring very soon.
These initiatives will help to grow investor interest and liquidity for SGX’s platform and enable it to enjoy multiple revenue streams.
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Disclaimer: Royston Yang owns shares of Singapore Exchange Limited.