It’s unfortunate but true: Singapore has shifted back to Phase 2 as COVID-19 infections have spiked in recent weeks.
The good news is not all businesses are impacted in the same way.
Some, such as aviation, hospitality and tourism, continue to be adversely impacted due to border closures.
But others are witnessing a boom amid surging demand for their products and services.
As such, if the current measures should get tightened even further, investors should not fret.
Here are three businesses that should continue to thrive even if the situation does worsen.
iFAST Corporation Limited (SGX: AIY)
iFAST owns a financial technology platform that offers a range of over 12,000 investment products.
The group is present in Singapore, Malaysia, Hong Kong, China and India and offers a broad array of bonds, stocks and exchange-traded funds (ETFs) on the Singapore, Hong Kong and US stock exchanges.
The pandemic has brought on a rapid shift in people’s habits as many are embracing technology.
This trend has resulted in strong net inflows, boosting iFAST’s assets under administration (AUA) to a new record.
As of 31 March 2021, the group’s AUA hit a new high of S$16.11 billion.
Net revenue for the first quarter of fiscal 2021 (1Q2021) climbed 51.4% year on year to S$28.5 million.
Operating profit surged by 140.7% year on year to S$10.3 million.
Net profit jumped by 142.5% year on year to S$8.8 million.
In line with the strong results, iFAST hiked its interim dividend from S$0.0075 to S$0.01.
With the group operating mainly online, its business should remain unaffected even if COVID-19 measures get tightened.
The business has several catalysts that should help it to continue growing.
First off, iFAST launched its Malaysian stockbroking service in late March to provide customers there with a “one-stop-shop” platform for investing in a variety of securities.
The group is also waiting for further details of its successful tender for Hong Kong’s eMPF platform project where it will work with its partner PCCW Limited (HKSE: 0008)
NetLink NBN Trust (SGX: CJLU)
NetLink NBN Trust, under the NetLink Group, designs, builds, owns and operates Singapore’s passive fibre network infrastructure for the country’s next-generation nationwide broadband network (NBN).
The group’s coverage extends to most residential homes in Singapore and also covers corporate customers as well.
NetLink collects a fixed fee per connected household, which explains the stability of its revenue even during the current downturn.
Residential connections increased by 1.4% year on year to 1,446,784 connections, underpinning the resilience of the Trust.
However, for the fiscal year ended March 2021 (FY2021), revenue inched lower by 0.5% year on year.
The main reason for this was due to temporary work stoppages amid access restrictions due to movement curbs.
However, the distributable amount increased slightly by 0.6% year on year to S$198 million.
As a result, distribution per unit also crept up 0.6% year on year to S$0.0508.
NetLink continues to expand its network in new housing estates and is confident of maintaining its distribution to unitholders.
The group will also explore the possibility of investing in overseas telecommunication infrastructure businesses.
Riverstone Holdings Limited (SGX: AP4)
Riverstone is a Malaysian-based manufacturer of nitrile and natural rubber gloves for both the healthcare and high-tech manufacturing industries.
The group employs around 4,000 people in its six facilities located in Malaysia, Thailand and China.
It has an annual production capacity of 10.5 billion gloves as of 31 December 2020.
The group provided a business update for 1Q2021, with its numbers demonstrating that nitrile glove demand continues to remain high due to the ongoing pandemic.
Revenue jumped from RM 279.4 million to over RM 1 billion, while gross profit jumped more than ten-fold from RM 67.1 million to RM 708.3 million.
Strong demand from the healthcare industry resulted in a big jump in the average selling price of glove products, leading to gross profit margin expanding from 24% to 68.6%.
Consequently, net profit soared more than 11-fold to RM 522.7 million.
The excellent financial performance has seen Riverstone paying out RM 0.22 in dividends for 2020, up nearly six-fold from the RM 0.037 paid out the year before.
The group’s expansion plan is intended to raise the total production capacity to 12 billion pieces by the end of this year.
By the end of 2023, capacity should increase to 15 billion pieces.
With glove demand expected to remain strong, Riverstone’s business should continue to thrive.
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Disclaimer: Royston Yang owns shares of iFAST Corporation and NetLink NBN Trust.
