Over the four trading sessions from Oct 25 to Oct 30, institutions were net sellers of Singapore stocks, resulting in a net institutional outflow of S$365 million. This accelerated the net outflow trend observed over the previous 10 sessions.

The stocks that led the net institutional outflow over these four sessions were DBS, UOB, OCBC, Sembcorp Industries, Singapore Technologies (ST) Engineering, Mapletree Pan Asia Commercial Trust, CapitaLand Investment, Seatrium, CapitaLand Integrated Commercial Trust and Mapletree Logistics Trust.

Meanwhile, Sats, Broadway Industrial Group, Dyna-Mac, Jardine Cycle & Carriage, Keppel DC Reit, Yanlord Land Group, Yangzijiang Shipbuilding, Singapore Airlines, Genting Singapore and Riverstone led the net institutional inflow.

Riverstone produces high-tech cleanroom gloves, premium healthcare gloves, and cleanroom consumables. The high-tech cleanroom gloves are designed to protect semiconductor products from contamination, corrosion and electrostatic discharge. Riverstone has ranked as a top-50 stock by trading turnover this year, and a top-30 stock by net institutional inflow.

According to the SGX Stock Screener, the stock maintains a return-on-equity ratio of 16.5 per cent, with the price-to-earnings ratio at 16.4 per cent.

From a sector perspective, the four sessions saw financial services and real estate investment trusts (Reits) book the most net institutional outflow, while the energy sector and consumer cyclicals bucked the trend and booked the most net institutional inflow.

The four sessions also saw nine primary-listed companies conduct buybacks with a total consideration of S$2.6 million.

This amount was significantly less than the usual quota, coinciding with the current earnings season.

On Oct 29, ST Engineering bought back 500,000 shares at an average price of S$4.62 per share. This brings the total shares repurchased to 0.2 per cent of its issued shares (excluding treasury shares) since the beginning of the current mandate.

The four trading sessions saw 70 director interests and substantial shareholdings filed for more than 30 primary-listed stocks. Directors or CEOs filed 12 acquisitions and three disposals, while substantial shareholders filed 10 acquisitions and 11 disposals.

Raffles Medical Group

On Oct 29, Raffles Medical Group executive chairman Loo Choon Yong acquired 1.1 million shares at an average price of S$0.89 apiece. This increased his total interest from 55.3 per cent to 55.36 per cent.

Since February, Dr Loo has been gradually increasing his total interest in the stock from 53.02 per cent. On Sep 26, he bought 470,000 shares at an average price of S$0.889 per share.

Beng Kuang Marine

On Oct 24, the Ginko-AGT Global Growth Fund reduced its substantial shareholding in Beng Kuang Marine from 7.13 per cent to 5.58 per cent by selling three million shares at an average price of S$0.251 per share.

Previously, on Jun 6, the fund had increased its stake in the group to more than 7 per cent, acquiring shares at an average price of S$0.181 apiece.

The rotation followed Beng Kuang Marine’s announcement last month that it would be removed from the SGX watch list with effect from Oct 15. Back in August, when it reported its results for its first half ended Jun 30, the group highlighted that it showed improved operating performance over the past four consecutive quarters, marking a financial turnaround from Q2 FY2023 (excluding a one-time gain on disposal).

Specifically, its profit attributable to shareholders reached S$8.57 million in H1 FY2024, a significant improvement compared to the net loss of S$0.85 million in H1 FY2023.

The Ginko-AGT Global Growth Fund was launched in February 2019. AGT Partners maintains three investment strategies: long-term investments, short-term active trading, and a quant-driven multi-factor strategy.

The fund manager maintains that the long-term, concentrated investments account for about 75 per cent of the fund’s assets under management (AUM). This strategy focuses on businesses with competitive advantages to maximise potential durable earnings power, prioritising certainty of earnings over speculative opportunities.

Going into 2024, the fund manager highlighted key competitive advantage considerations including network economics, high switching costs, lowest-cost production, favourable locations, and valuable intangibles such as branding, patents, and regulatory requirements.

The strategy also targets companies that can reinvest earnings at reasonable rates of return for continued growth. The fund managers also said that effective capital allocation by management, including share repurchases and dividends, is an important consideration with investments made at reasonable valuations, often using the price-to-earnings multiple.

AGT Partners said that the short-term active trading strategy represents around 20 per cent of the fund’s AUM, while the quant-driven multi-factor strategy makes up about 5 per cent.

With the aim to double its net asset value every four years, averaging around 20 per cent per annum, the fund has consistently attracted investors since 2023, when it opened to external accredited investors.

Having delivered a compound annual growth rate of more than 40 per cent since its inception, the fund intends to continue building on its current track record and focus on compounding the wealth of its investors at a good rate over the long term.

Zheneng Jinjiang Environment

Zheneng Jinjiang Environment bought back 350,000 shares at an average price of S$0.40 per share. This brings the total shares repurchased to 0.34 per cent of its issued shares (excluding treasury shares) since the beginning of the current mandate.

The company is a leading waste-to-energy (WTE) operator in China. As at Jun 30, 2024, it managed 38 WTE facilities with a combined daily capacity of 44,405 tonnes. About 98 per cent of its revenue is derived from its core WTE operations, encompassing waste treatment and the sale of electricity and steam generated from this process.

Over the past five years, the group has demonstrated consistent and steady growth in its waste treatment capacity, expanding by 16.7 per cent from 38,060 tonnes in 2020. Additionally, its installed electricity power-generation capacity has grown from 718 megawatts (MW) to 921 MW during the same period, reflecting a rise of around 28.3 per cent.

Its business model includes both build-own-operate and build-own-transfer frameworks. For H1 FY2024 (ended Jun 30), the group reported revenue of 1.8 billion yuan (S$335 million) and a net profit of 251.9 million yuan (excluding a loss associated with foreign-currency translation differences from the disposal of its India business).

The group is targeting a 36 per cent increase in daily capacity to 60,605 tonnes over the next decade. This growth strategy revolves around the commissioning of new facilities both domestically and internationally, alongside dedicated technological advancements to enhance efficiency and optimise power-generation capacity in existing plants.

Zheneng Jinjiang Environment made meaningful strides in its overseas business recently. On Oct 18, it announced that its subsidiary, PT Indo Green Power, signed a facility agreement involving DBS Bank and PT Bank Negara Indonesia as lead arrangers, and PT Bank DBS Indonesia as global facilities agent.

The agreement provides for an US$85 million USD facility and a 243 billion rupiah (S$20.5 million) IDR facility. PT Indo Green Power will construct, own, and operate a WTE facility in Palembang, Indonesia, capable of processing 1,000 tonnes of waste per day.

Zheneng Jinjiang Environment is also employing several strategies to ensure prudent capital management. It maintains a flexible financing policy, which includes extending short-term working capital loans upon maturity and strategically pacing out capital expenditures (capex) to align with steady growth plans.

The company aims to keep a balanced equity-to-debt ratio of 30:70 for WTE facility capex, which helps manage financial risk and maintain a strong balance sheet. Additionally, it works closely with its largest controlling shareholder to leverage its strong credit status, thereby broadening financing channels.

Zheneng Jinjiang Environment is also looking to introduce strategic investors or Reits at the project level, and regularly reviews and adjusts its overseas expansion plans to ensure sustainable growth. Collectively, these measures are designed to mitigate liquidity pressures and lower project and financing costs.

Guocoland

Between Oct 23 and Oct 25, GuocoLand chairman and non-independent non-executive director Quek Leng Chan increased his deemed interest via acquisitions by Associated Land. The 65,400 shares were bought at an average price of S$1.58 apiece.

This followed the acquisition of 29,600 shares between Oct 21 and Oct 22 at S$1.59 per share, and 56,000 shares purchased at S$1.50 each on Jun 10.

Quek maintains a 71.86 per cent deemed interest in the leading real estate group that offers comprehensive capabilities across the entire real estate value chain. GuocoLand maintains that its property investment segment generates steady rental income and capital appreciation from high-quality commercial and mixed-use assets, while the property development segment is positioned to deliver profits through the creation and sale of premium residential and integrated developments.

Inside Insights is a weekly column on The Business Times, read the original version.

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