Diving into the world of investing can be an exhilarating yet daunting experience, especially for new investors faced with the myriad of companies listed on the Singapore Exchange (SGX).
The sheer volume of choices can easily become overwhelming, leaving you unsure of where to begin.
I would like to make it easier.
Below are seven Singapore-listed companies that are worth considering for your initial investment portfolio.
Consider them as a sample of what is available before you dive into the main course yourself.
Whether you’re looking for stability, growth potential, or dividends, these companies offer a solid foundation for building a diverse and resilient investment portfolio.
1. DBS Group Holdings Ltd (SGX: D05)
DBS Group Holdings Ltd (DBS) holds a significant presence both domestically as the largest bank in Singapore, and within the region, operating in 19 markets.
For the first quarter of 2024 (1Q 2024), DBS saw its total income climb by 13% year on year to S$5.6 billion.
This increase was driven by an 8% year on year growth in net interest income on the back of high interest rates, a 23% year-on-year growth in net fee income from increased wealth management and credit card fees, and a 44% year-on-year surge in non-interest income, primarily from its treasury customer sales.
Net profit increased by 15% year on year to a record-breaking S$2.96 billion, with return on equity hitting an all-time high of 19.4%.
A dividend payout of S$0.54 per share was declared.
2. SBS Transit Ltd (SGX: S61)
SBS Transit is Singapore’s largest public bus operator, commanding a market share of 62% based on the number of bus routes.
Additionally, it holds a 30% market share of the country’s total railway track length, operating two MRT lines (the Downtown Line and the North East Line) and one LRT line (the Sengkang-Punggol LRT).
For the full-year ending 31 December 2023 (2023), SBS Transit’s group revenue saw a modest increase of nearly 1% year on year, surpassing S$1.5 billion.
This growth was driven by higher rail ridership and increased bus mileages, though it was partially offset by lower fuel indexation and the full-year impact of reduced service rates for the five extended Negotiated Bus Packages implemented in September 2022.
SBS’s net profit rose by 1.5% year on year to over S$69 million.
A total dividend payout of S$0.1116 per share was declared for 2023.
3. Singapore Exchange Ltd (SGX: S68)
Singapore Exchange Ltd, or SGX, holds a natural monopoly as the sole stock exchange operator in Singapore.
For the first half of the fiscal year ending December 2023 (1H FY2023/24), revenue increased by 3.6% year on year to S$592 million, primarily driven by higher revenues from its Currencies and Commodities segment, as well as from Platform and Others, partially offset by lower revenue from Equities – Cash and Equities – Derivatives.
Net profit decreased by around 1% year on year to approximately S$281.6 million due to one-off non-operating items.
A total dividend payout of S$0.17 per share was declared for 1H FY2023/24.
4. Sheng Siong Group Ltd (SGX: OV8)
Sheng Siong Group Ltd is one of largest supermarket chains in Singapore, with nearly 70 stores spread across the island and five stores in Kunming, China.
For the fiscal year ended December 2023 (2023), Sheng Siong’s revenue increased by approximately 2% year on year to S$1.37 billion, driven by the opening of six new stores in 2022 and 2023 in Singapore, along with contributions from existing stores.
Net profit rose by 3.5% year on year to around S$68.5 million.
A total dividend payout of S$0.0625 per share was declared for FY2023.
5. Singapore Airlines Ltd (SGX: C6L)
Singapore Airlines Ltd (SIA), the nation’s flagship carrier, has a passenger network of almost 120 destinations across 35 countries and territories as of the end of the financial year on 31 March 2024 (FY2023/24).
For FY2023/24, SIA’s group revenue surged by 7% year on year to a record S$19 billion, driven by a 17% year on year rise in passenger flown revenue, though the gain was partially offset by a sharp decrease in cargo flown revenue.
Net profit soared by 24% year on year to approximately S$2.7 billion, largely due to improved operating performance, a shift from net finance charges to net interest income, lower tax expenses, and a turnaround from losses to profits of its associated companies.
SIA’s total dividend payout for FY2023/24 was S$0.48 per share.
6. Singapore Telecommunications Ltd (SGX: Z74)
Singapore Telecommunications Ltd, commonly known as SingTel, is Asia’s leading communication technology group, offering a wide range of services including next-generation communication, 5G, technology services, and infotainment to both consumers and businesses.
With a presence in Asia, Australia, and Africa, SingTel reaches over 780 million mobile customers across 21 countries. The telco’s business infrastructure and technology services extend to 21 countries, with over 420 direct points in more than 360 cities.
For the financial year ending 31 March 2024 (FY2023/24), SingTel reported an operating revenue of S$14.1 billion, a decline of 3.4% year on year, which can be attributed to a 6% depreciation of the Australian Dollar over the same period.
However, the blue-chip telco’s net profit plunged by 64% year on year to S$795 million, primarily due to an exceptional loss of S$1.47 billion from non-cash impairment charges on goodwill and Optus Enterprise’s fixed network assets.
Without these charges, net profit would have increased by 10% year on year to S$2.26 billion.
A dividend payout of S$0.15 per share was declared for FY2023/24.
7. Vicom Ltd (SGX: WJP)
Vicom Ltd is Singapore’s leading provider of inspection and technical testing services, offering a comprehensive range of services in both vehicle and non-vehicle testing fields.
For the financial year ending 31 December 2023 (FY2023), Vicom’s group revenue increased by 3.3% year on year to approximately S$112 million, driven by higher contributions from its inspection and testing services, as well as rental income.
Net profit rose by 5.4% year on year to S$27.6 million.
A total dividend payout of S$0.055 was declared for FY2023, representing a payout ratio of 70%.
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Disclaimer: Lim Jun Yuan owns shares of DBS Group.
