Singapore’s Temasek expands portfolio, but says it may slow down investments as global risks grow

Key Points
  • Singapore’s state-owned investment firm Temasek Holdings said its portfolio grew to a record 308 billion Singapore dollars ($235 billion) in the year to March 31.
  • That’s a 12 percent year-over-year increase in Singapore dollar terms.
Vivek Prakash | Reuters

Singapore’s state investment firm Temasek Holdings said Tuesday the value of its portfolio jumped above 300 billion Singapore dollars for the first time ever.

The company said the size of its portfolio grew to 308 billion Singapore dollars ($235 billion) in the year ended March 31, representing a 12 percent increase year-over-year in local currency terms.

In the past year, the company made investments worth 29 billion Singapore dollars and divested 16 billion Singapore dollars.

Growth in its portfolio size came on the back of an 18 percent year-over-year increase in MSCI's Asia shares ex-Japan index in the year to March, while Singapore's main index rose 8 per cent.

But Temasek warned that the current financial year is shaping up to be a challenging one, given rising trade and geopolitical tensions. Some monetary and financial stresses are also observed in a number of key economies, the company said.

“We are tempering our investment pace in the year ahead, but remain open to intrinsically investable opportunities, including counter-cyclical ones,” Lim Boon Heng, Temasek’s chairman, wrote in the company annual report that was released on Tuesday.

In the past year, a number of companies that Temasek has a stake in have experienced surges in their share prices. Singapore’s DBS Bank saw shares jumped 42 percent, while in Hong Kong, China Construction Bank Corp and Industrial and Commercial Bank of China rose 29 percent and over 32 percent, respectively.

Temasek — an active equity investor — is owned by the government of Singapore, a tiny but wealthy Southeast Asian nation.

Temasek, which invested mainly in Singapore companies in its early days, have turned into a global player in recent years. More than 70 percent of the company’s portfolio exposure is now outside its home country and spreading across other Asian nations, Europe and the Americas.

It has also increased its stake in start-ups. Last month, Temasek and Singapore state fund GIC were among the main investors in a $14 billion fundraising by China’s Ant Financial – a spin-off from technology giant Alibaba.

The investor also backed Indonesian ride-hailing firm Go-Jek and led a $502 million investment in Magic Leap, a U.S. startup developing augmented reality tech products.

The approach to focus on sectors such as technology, life sciences and non-bank financial services is one that’s likely to stay, according to Temasek.

“This on-going active investment stance is focused on solutions for a better, smarter and more connected world over the medium to long term,” Lee Theng Kiat, executive director and chief executive of Temasek International, said in a statement.

— Reuters contributed to this report.