5 Singapore Blue-Chip Stocks Falling More Than 20% Year-to-Date: Can They Recover?

One good method of finding suitable investment opportunities is to hunt in the bargain bin.

With share prices affected by many factors such as macroeconomics, business fundamentals and sentiment, some companies could see their share prices battered for no apparent reason.

The key is to look for solid businesses that have been unfairly punished.

Blue-chip stocks qualify as investments that can give you a good night’s sleep.

Their reputation and long track record also mean that they have gone through good times and bad.

Here are five blue-chip stocks whose share prices have tumbled 20% or more.

We dig deeper into each of them to determine if they can recover in 2024.

Hongkong Land (SGX: H78)

Hongkong Land, or HKL, is a property investment, management and development group.

The group owns and manages more than 850,000 square metres of prime office and luxury retail assets in Hong Kong, Singapore, Beijing, and Jakarta.

HKL’s share price has declined by 30.6% year-to-date (YTD) to close at US$3.22.

The property giant released its latest interim management statement for the third quarter of 2023 (3Q 2023).

The underlying net profit for 3Q 2023 was lower year on year because of lower contributions from development properties due to the timing of planned sale completions.

In Hong Kong, HKL’s office portfolio saw vacancies (on a committed basis) rise to 6.8% from 6.2% as of the end of June.

Rental reversion remained negative while leasing demand stayed weak with higher interest rates impacting office demand.

Singapore saw positive office rental reversions with physical vacancy staying low at 2.1% as of 30 September 2023.

HKL expects 2023’s net profit to be moderately lower than 2022 because of the shift in the timing of revenue recognition for residential sale completions at West Bund in Shanghai coupled with write-downs in the value of residential properties in Wuhan.

Thai Beverage (SGX: Y92)

Thai Beverage is a leading food and beverage company with four major divisions – spirits, beer, non-alcoholic beverages, and food.

The group has an extensive distribution network with over 400,000 points of sale in Thailand.

Thai Beverage’s share price has slid by close to 28% YTD to close at S$0.49.

The group announced a mixed set of results for fiscal 2023 (FY2023) ending 30 September.

Revenue inched up 2% year on year to THB 279.1 billion but operating profit slipped by 9% year on year to THB 32.9 billion.

Net profit also fell by 9% year on year to THB 27.4 billion.

Despite the dip, Thai Beverage maintained its final dividend of THB 0.45 for FY2023.

Venture Corporation Ltd (SGX: V03)

Venture Corporation is a provider of technology products, services and solutions for clients in industries such as life sciences, genomics, medical devices, and networking and communications.

Shares of the technology group have tumbled by 26.6% YTD to close at S$12.53.

Venture is still feeling the effects of the semiconductor slump on its financial statements.

For the first nine months of 2023 (9M 2023), revenue fell by 18.8% year on year to S$2.3 billion.

Net profit declined by 25.2% year on year to S$203.3 million.

Despite the profit drop, Venture’s net cash position remained robust at S$956 million as of 30 September 2023.

Notwithstanding the downturn, the group intends to increase its participation in new high-growth technology domains to deliver greater value for shareholders.

City Developments Limited (SGX: C09)

City Developments Limited, or CDL, is a global real estate company with operations spanning 143 locations in 28 countries and regions.

CDL’s share price has fallen by 23.3% YTD and settled at S$6.26.

For its 3Q 2023 business update, CDL healthy Singapore property development sales of 183 units with a total value of S$325 million.

It has also progressively sold down its existing inventory with four projects over 90% sold.

The property group secured a 155,351 square feet site for S$294.9 million to replenish its land bank and will launch a development there in the second half of 2024 with around 350 residential units.

During the quarter, CDL commenced an asset enhancement initiative for City Square Mall that will cost around S$50 million.

Slated to be completed in 2025, the renovation works will enhance the retail experience and revitalise its tenant mix.

DFI Retail Group (SGX: D01)

DFI Retail Group is a pan-Asian retailer with over 10,700 outlets in 13 countries and territories employing around 218,000 staff.

The group’s shares have declined by 22.4% YTD to close at US$2.22.

For its 3Q 2023 business update, DFI Retail Group’s underlying profit surged by more than 80% year on year.

The North Asian grocery business saw sales and profitability in line with the prior year but Southeast Asian grocery remained weak with intense competition and weaker consumer sentiment caused by inflation.

However, the Convenience Store division enjoyed higher underlying profitability for 3Q 2023 on a year-on-year basis.

The Healthy and Beauty segment also saw higher profitability with Mannings experiencing double-digit like-for-like sales growth boosted by higher tourist numbers and market share gains.

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Disclosure: Royston Yang does not own shares in any of the companies mentioned.

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