Welcome to this week’s edition of top stock market highlights.
CapitaLand Investment Limited (SGX: 9CI)
CapitaLand Investment Limited, or CLI, launched a research paper on 5 July titled “Asia Pacific Data Centre Investment Strategies in the Age of Digitalisation”.
The property giant owns a portfolio of 27 data centres with about US$4.5 billion in assets under management (AUM) along with more than 800 MW in gross power spread across eight countries.
The report also found that 97% of institutional investors planned to increase their data centre allocation, particularly in the Asia-Pacific region.
Artificial intelligence (AI) is the driving force for this demand, coupled with ongoing requirements for cloud computing and digitalisation.
Asia’s internet user base has soared sevenfold since 2005, compared with just 1.9 times in the US and 1.8 times in Europe.
Hyperscalers will continue to drive data centre demand and CLI estimates that the Asia-Pacific colocation market will double in size to US$52 billion by 2026.
The report also named the key data centre markets in APAC – Singapore, Tokyo, Osaka, Seoul, and Sydney.
Because of China’s huge population, both Beijing and Shanghai are also poised to become key data centre locations.
CLI also threw the spotlight on India as the next major hotspot for data centre investments.
Seven cities in the country – Mumbai, Bengaluru, Chennai, Hyderabad, Delhi, Pune and Kolkata, will be the focal points for new data centre developments.
Of the seven, Mumbai stands out as the hub, helping to host more than half of the country’s data centres.
With a lack of stabilised data centres available for sale in APAC, investors should find attractive opportunities to develop new data centres.
Singapore Technologies Engineering (SGX: S63)
Singapore Technologies Engineering, or STE, has announced the clinching of a two-year agreement with Safran Aircraft Engines (EPA: SAF) for its Commercial Aerospace (CA) division.
Under the agreement, STE will provide module repair offload support for the CFM leading edge aviation propulsion (LEAP) 1A and 1B engines.
Safran will allow the blue-chip group to take over module repair work on the high-pressure turbine rotor assembly and stage two nozzle assembly for these two types of engines.
In addition to these services, STE will also provide LEAP-1B engine maintenance offload services for Safran.
With more operators ramping up their flying operations, STE is in a good position to cater to the growing demand for maintenance, repair, and overhaul (MRO) services.
Safran’s LEAP fleet consists of over 3,300 aircraft and can provide the group with a steady stream of business.
STE will also provide ongoing offload support for Safran by maintaining their CFM56-5B, CFM56-7B, and LEAP-1A engines.
SATS Ltd (SGX: S58)
SATS has restructured its Gateway Services division and split it into two new business units – the Singapore Hub and Gateway Services Asia-Pacific.
By segregating these two business units based on region, SATS can continue to invest in Singapore while seeking to scale up its international presence by capturing overseas growth opportunities.
Bob Chi will be redesignated as the CEO of Gateway Services Asia-Pacific while Henry Low, SATS’ existing Chief Operating Officer, will become the CEO of the Singapore Hub.
Both appointments will take effect from 1 October this year.
Singapore Hub will focus on improving Singapore’s aviation hub competitiveness and the unit will help to strengthen SATS’ ability to provide for the current and future needs of Singapore’s Air Hub.
As for Gateway Services Asia-Pacific, this unit will focus on growing SATS’ Asia-Pacific market share by managing operations in overseas airports to help deliver a unified level of services to its customers.
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
