Many businesses, including blue-chip ones, had taken it on the chin over the past two years.
Business conditions, however, appear to be on the mend.
With the reopening of borders and the further relaxation of COVID-19 measures, consumer demand and spending are set to improve.
Companies in vulnerable sectors such as travel, tourism and transportation are breathing a sigh of relief as the wheels of commerce are grinding for them once again.
Investors who are looking for bargains can focus on blue-chip stocks with catalysts that can persist in the new normal.
Here are three stocks that may just fit the bill.
Wilmar International Limited (SGX: F34)
Wilmar is an agribusiness group with an integrated business model that covers the entire value chain of the agricultural commodity business.
The group handles the cultivation, milling, processing, branding, and distribution of a wide range of commodities and food products such as animal feed and biodiesel.
Wilmar reported an impressive set of earnings for its fiscal 2021 (FY2021).
Revenue climbed 30.2% year on year to US$65.8 billion while core net profit jumped 24% year on year to US$1.8 billion.
A final dividend of S$0.105 per share was proposed, bringing FY2021’s total dividend to S$0.155, a record high for the group.
Wilmar’s strong performance can be credited to its two core divisions — feed and industrial products, and plantation and sugar milling.
The former saw its profit before tax (PBT) rise 58% year on year to US$1.26 billion while the latter’s PBT soared more than five-fold year on year to US$564.1 million.
The successful listing of Wilmar’s Chinese subsidiary, Yihai Kerry Arawana (SHE: 300999) and its Indian joint venture, Adani Wilmar Ltd (NSE: AWL), shows the group’s track record of unlocking value for shareholders.
Wilmar is optimistic about its Food Products segment as volumes are expected to grow as it expands its plants and taps on central kitchen businesses in China.
Genting Singapore Ltd (SGX: G13)
Genting Singapore owns and operates the Resorts World Singapore (RWS) integrated resort (IR) that houses six hotels with around 1,600 hotel rooms, a casino, one of the world’s largest aquariums, a theme park, and a selection of retail, dining and entertainment options.
The group reported a creditable performance for FY2021 despite the presence of safe distancing measures.
Revenue stayed flat year on year at S$1.07 billion but operating profit surged 97% year on year to S$227.8 million.
Net profit more than doubled year on year from S$69.2 million to S$183.3 million.
The government’s introduction of the vaccinated travel framework to replace the vaccinated travel lanes system should bode well for Genting Singapore.
Passenger numbers on Singapore Airlines Limited (SGX: C6L) flights have soared more than eight-fold year on year in February to 544,600 passengers.
This influx of tourists will help to boost Genting Singapore’s revenue and enable the group to post higher operating and net profits.
Furthermore, Genting Singapore’s massive S$4.5 billion mega expansion of RWS will start this quarter, with plans to expand its Universal Studios Singapore and the Southeast Asian aquarium.
The revamp of these two attractions should be completed by 2024, in time for the recovery of the tourism sector which should see significantly more tourists flocking to the IR.
ComfortDelGro Corporation Limited (SGX: C52)
ComfortDelGro Corporation Limited, or CDG, is a land transport conglomerate with a fleet size of 35,000 buses, taxis and rental vehicles.
The group also runs 177 kilometres of light and heavy rail and has a presenceis present in seven countries — Singapore, Malaysia, Australia, the UK, New Zealand, China and Ireland.
CDG enjoyed a strong rebound in FY2021 with revenue rising by 9.1% year on year and operating profit jumping by 72.6% year on year to S$210 million.
Excluding government reliefs, the group would have reported an operating profit of S$125.4 million, a reversal from the S$47.6 million operating loss a year ago.
The land transport giant’s numbers look set to improve further this year.
Up to 75% of employees can now return to the workplace, up from the previous limit of 50%.
This relaxation will result in more people commuting on buses, trains and taxis.
Group sizes at social gatherings have also doubled from five to 10, and this change should encourage more groups to meet up and gather, further boosting usage of public transport services.
CDG has also been busy on the acquisition front.
Last November, it announced the acquisition of a property in the UK to develop a new bus garage.
And just last month, the group announced the acquisition of Rothery’s Coaches business in Queensland, Australia, for S$6.7 million, which will add a further 16 buses to its existing bus operations.
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Disclaimer: Royston Yang does not own shares in any of the companies mentioned.
