Blue-chip stocks are famed for their ability to handle adversity and for dishing out steady dividends to their shareholders.
These are the key reasons why investors include them as the “bedrock” of their portfolios.
The good news is that some of these blue-chip stocks are working hard to realise value for their shareholders either through capital recycling or a strategic review.
By doing so, these companies may see their share prices heading higher, thus netting attractive capital gains for their investors.
Here are three Singapore blue-chip stocks working hard to unlock value for their shareholders.
Keppel Ltd (SGX: BN4)
Keppel is a global asset manager that provides solutions for the infrastructure, real estate, and connectivity sectors.
Back in 2020, the group announced its Vision 2030 plan to drive long-term strategy and transformation.
Keppel’s portfolio would be refocused to become an integrated business along with an asset management arm to fund growth and provide a platform for capital recycling.
In 2023, in an interview with CEO Loh Chin Hua, he said that Keppel is moving away from businesses with lumpy earnings towards those that provide recurring earnings.
In an acceleration towards Vision 2030, the group plans to build scalable businesses that leverage its asset-light model in a shift away from the previous asset-heavy business model.
For its 2024 results, Keppel reported S$1.06 billion in net profit (excluding its offshore and marine assets), up 5% year on year.
Its cumulative asset monetisation since October 2020 is close to S$7 billion, including S$1.5 billion in 2024 alone.
The asset manager has also made good progress in growing its recurring income as a % of net profit.
For 2024, this percentage stood at 72%, higher than the 56% recorded in 2022 and more than three times the 21% back in 2021.
Keppel has also steadily grown its funds under management by 2.4 times since 2020 to S$88 billion.
Asset management fees have increased by a 25% compound annual growth rate over the same period, going from S$180 million in 2020 to S$436 million in 2024.
Singtel (SGX: Z74)
Singtel is Singapore’s largest telecommunication company (telco) by market capitalisation.
The telco announced its strategic reset back in 2021 to realign the business and better position it for success.
In 2023, Singtel held an Investor Day to communicate its growth strategy and targets.
These include the rejuvenation of its core business and the building of a regional data centre platform.
In May last year, the telco introduced ST28, a new growth plan that aims to deliver sustainable value realisation for shareholders.
Under ST28, the group will pursue smart capital management and build on the capital recycling programme for its strategic reset.
A pipeline of S$6 billion in monetisable assets has been identified.
These strategies have yielded results, with underlying net profit for the first nine months of fiscal 2025 rising by 11% year on year to S$1.9 billion.
For the first half of fiscal 2025, Singtel upped its total interim dividend to S$0.07, comprising a value realisation dividend of S$0.014 from capital recycling proceeds along with a core ordinary dividend of S$0.056.
This total dividend was higher than the prior year’s S$0.052.
Fiscal 2025’s dividend guidance is for a payout of around S$0.165, which would exceed fiscal 2024’s total dividend of S$0.15.
Hongkong Land Holdings (SGX: H78)
Hongkong Land Holdings, or HKL, is a property development, management, and investment group with a real estate footprint spanning more than 850,000 square metres of luxury retail, residential, and hospitality assets.
The group announced a new strategic direction in October 2024 following months of review led by CEO Michael Smith.
HKL will simplify its business to focus on investment properties that provide long-term recurring income.
Following this decision, the group will no longer invest in the build-to-sell segment but will, instead, recycle capital out of this segment into new integrated commercial property opportunities.
Management sees a clear competitive positioning for the group in ultra-premium commercial properties and this capital recycling will release capital and realise value from existing assets.
Through this process, HKL aims to improve its return on equity.
The plan’s objectives for 2035 are to double the group’s underlying profit before interest and taxes while doubling its dividend per share.
HKL will leverage third-party capital to grow its assets under management from the current US$41 billion to US$100 billion by 2035.
In addition, the property giant will also allocate up to 20% of the proceeds from capital recycled to repurchase shares.
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
