Moves that unlock value will have a greater impact on the market than new Singapore Depository Receipts (SDRs) or Catalist listings.
The recent launch of new SDRs tied to five major Hong Kong stocks—Alibaba, Tencent, BYD, HSBC, and Bank of China—may be well received, while upcoming Catalist listings like Attika Group and Goodwill Entertainment might struggle. However, Hongkong Land’s strategic pivot could prove most significant.
Local investors now have easier access to popular Hong Kong stocks via the Singapore Exchange (SGX) with SDRs, which are traded in Singapore dollars and settled through the Central Depository (CDP). These SDRs lower the minimum investment required, providing greater flexibility. For example, a board lot of 500 BYD shares in Hong Kong would cost S$23,433, but the minimum investment for BYD’s SDR is just S$469, making it more accessible to investors.
Additionally, these SDRs offer the advantage of being tradable just before and after Hong Kong market hours, which could appeal to investors looking to time their trades more precisely.
While the SDRs have potential, the bigger story lies in Hongkong Land’s recent corporate strategy shift. On October 29, the company announced plans to move away from its build-to-sell model and focus on generating recurring income from investment properties in key Asian cities. By 2035, it aims to recycle US$10 billion in capital and grow assets under management from US$40 billion to US$100 billion through capital partnerships, private funds, and real estate investment trusts. In doing so, the group seeks to double its underlying profit before interest and tax and increase its dividend per share.
Since this strategic announcement, Hongkong Land’s share price has risen by over 15%. If this value-unlocking strategy succeeds, it could inspire other major real estate companies to follow suit, potentially boosting overall market activity more than any new SDRs or Catalist listings could.
In contrast, upcoming Catalist listings like Attika Group (interior decoration) and Goodwill Entertainment (karaoke lounges) might face challenges in attracting investors. The exception could be Goodwill Entertainment, whose relatable business model may appeal to a broader audience, but overall, these smaller companies will need time to build investor confidence.
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