Blue-chip stocks offer stability and consistent dividends because of their strong reputation and track record. The businesses of blue-chip stocks also grow steadily over time which then give investors capital gains.
In this article, we singled out 4 blue chip Singapore stocks for beginners to get started.
DBS Group Holdings
DBS Group is a leading financial services group in Asia with a presence in 18 markets. DBS is in the three key Asian axes of growth: Greater China, Southeast Asia and South Asia. The bank’s “AA-” and “Aa1” credit ratings are among the highest in the world.
In its 2Q 2024 results, DBS Group reported total income up 9% to S$5.48 billion with commercial book total income up 9% to $5.30 billion from broad-based growth.
Second-quarter net profit was up 4% YoY to $2.80 billion with ROE at 18.2%. Balance sheet remains strong with NPL ratio unchanged at 1.1%, SP remains low at 8bp for 2Q and 9bp for 1H. CET-1 ratio was at 14.8%.
DBS Group declared an interim dividend of 54 cents per share. DBS anticipate net interest income growth to be mid-single digit percent. Commercial book non-interest income growth to be in mid-to-high teens with total income growth to be high-single digit.
Hence, DBS is definitely one of 4 blue chip Singapore stocks for beginners to get started. You may wish to view the bank website here.
Oversea-Chinese Banking Corporation
Oversea-Chinese Banking Corporation was incorporated in Singapore on 31 October 1932 to carry on business in banking and finance. The Bank is the successor to Chinese Commercial Bank Ltd, Ho Hong Bank Ltd and the Overseas-Chinese Bank Ltd.
OCBC Bank offers a comprehensive range of banking services and financial solutions in consumer banking, business banking, international banking, global treasury and investment management.
The OCBC Group has diverse subsidiaries that are involved in financial futures, regional stockbroking, trustee, nominee and custodian services, property development and hotel management.
OCBC reported net profit of S$3.93 billion for the first half of 2024 (“1H24”), 9% higher as compared to S$3.59 billion from the previous
year (“1H23”).
The Group’s strong first half performance was underpinned by broad-based income growth which surpassed S$7 billion for the first time, lifted by higher net interest income and non-interest income.
Operating expenses were well controlled, with cost-to-income ratio (“CIR”) improving to 37.5%. Allowances were 14% lower at S$313 million. Customer loans grew 3% in constant currency terms, while asset quality remained sound with non-performing loan (“NPL”) ratio trending lower to 0.9%.
The Group maintained its healthy capital, funding and liquidity positions. On an annualised basis, return on equity improved to 14.5%
and earnings per share was higher at S$1.74.
OCBC declared an interim dividend of 44 cents, up 10% or 4 cents from a year ago. This represents a payout ratio of 50% of the Group’s 1H24 net profit.
With strong capital position, diversified earnings base and prudent approach towards risk management, OCBC is well positioned to navigate the challenging macroeconomic landscape. You can view the bank website here.
Singapore Exchange
SGX owns and operates the only integrated securities exchange and derivatives exchange in Singapore and their related clearing houses. The securities exchange was the first fully electronic and floorless exchange in Asia.
SGX reported FY2024 adjusted net profit of S$525.9 million, 4.5% higher from the previous year (S$503.2 million). Adjusted EBITDA was up at S$711.6 million (S$688.6 million), while adjusted earnings per share was 49.2 cents (47.1 cents).
Revenue increased 3.1% to S$1,231.7 million (S$1,194.4 million), mainly driven by higher revenues from Currencies and Commodities and Platform and Others, partially offset by lower Equities and Derivatives revenue.
SGX declared a final quarterly dividend of 9.0 cents (8.5 cents) per share, representing an annualised increase of 5.9%.
The Monetary Authority of Singapore has set up a review group to give recommendations on how to strengthen the development of Singapore’s stock market, SGX will definitely have better prospects ahead. You can view the company website here.
This is especially so in Period 9 where we will see the Global South countries including South East Asia countries boom for the next 20 years. Hence, SGX is well-positioned as one of the 4 blue chip Singapore stocks for beginners to get started.
Singapore Technologies Engineering
ST Engineering is a global technology, defence and engineering group with offices across Asia, Europe, the Middle East and the U.S., serving customers in more than 100 countries.
The Group uses technology and innovation to solve real-world problems and improve lives through its diverse portfolio of businesses across the aerospace, smart city, defence and public security segments.
ST Engineering posted a revenue of $5.52b for the first half of 2024, a 14% growth year-on-year (y-o-y) from $4.86b, driven by higher contributions from all three business segments.
Group EBITDA was $786m, up 11% y-o-y from $711m. Group EBIT increased by 18% y-o-y to $523m from $444m, and Group Profit before tax (PBT) was 19% higher y-o-y at $416m from $351m.
Group Profit attributable to shareholders (Net Profit) rose to $337m, reflecting a 20% improvement from $281m a year ago. The company had declared a second interim dividend of 4.0 cents per share.
ST Engineering order book remains healthy at $27.9b as at end June 2024, of which about $4.9b is expected to be delivered in the remaining months of 2024.
Hence, ST Engineering remains confident in achieving long-term sustainable growth and is one of the 4 Blue Chip Singapore stocks. You can view the company website here.
I have highlighted 4 blue chip Singapore stocks for beginners to get started. Investors need to do their due diligence before they invest.
