Temasek announced that the value of its global assets was S$242 billion ($180 billion) by March, down nine per cent from last year’s record S$266 billion. Over a three-year period, Temasek’s total shareholder return was 3.25 per cent in Singapore-dollar terms; over a 20-year period, total shareholder return was 6 per cent.
Advertisement
Temasek, headed by Ho Ching, wife of Singapore’s prime minister, also expects more volatile markets and a challenging business environment, but said it had the flexibility to pursue investment opportunities.
It invested S$30 billion in its financial year ended March led by targets in the United States and China, while divesting a record S$28 billion.
Reuters reported earlier this week that Temasek is looking at USA deals, especially in technology, consumer and healthcare sectors, to diversify away from its exposure in Asia and emerging markets.
Temasek – a strategic investor that tracks long-term performance rather than year-on-year gains – holds among its portfolio telecoms group SingTel, Singapore Airlines and banking giant China Construction Bank.
Telecommunications, media and technology became the largest single industrial sector in Temasek’s portfolio, growing to 25 per cent from 24 per cent, as Temasek continued to grow its investments in technology businesses.
Temasek is shifting its weight in China, too.
The investment firm had more than half of its assets in China and Singapore, leaving it particularly exposed to a 21% slump in China’s CSI 300 Index and an 18% decline in Singapore’s Straits Times Index in the 12 months ended March 31.
“We saw the liquidity-driven market rally earlier in the year, and took the opportunity to step up our divestment pace, relative to the past few years”, Lee Theng Kiat, who was appointed last year as CEO of Temasek International, said in the statement.
“Over the last five years, we’ve been paying a lot more attention on the non-bank financial services, for example insurance, payments, new technology in the fintech area”. New investments during the year included PayPal, Citic Securities and WuXi PharmaTech.
The firm, which plans to open an office in San Francisco this year to scout for tech investment opportunities, loaded up on stakes in U.S. pharmaceutical and healthcare firms including Alexion Pharmaceuticals Inc. and Regeneron Pharmaceuticals Inc., which develop treatments for serious medical conditions, last year.
The investment company’s head of financial services Png Chin Yee said in a press briefing: “2015 marked a challenging year for the global economy, with the slowest rate of expansion since the financial crisis”.
Advertisement
Despite some market concerns over non-performing loans, Temasek said it remains comfortable with its positions in Chinese banks, noting that China offers significant growth potential in the long term. The portfolio exposure to Europe remained low at 8 per cent. Temasek said the impact from Britain’s vote to leave the European Union on its portfolio has been “fairly modest”.
