DBS Vickers nabs the top titles in Asiamoney Brokers Poll 2017 in Singapore for the categories of best local brokerage, best overall country research and best for overall sales service.
DBS has a clear and established footprint across the region, which is reflected in DBS Vickers' own resources. The overall team has over 60 analysts and economists covering some 600 stocks in Asia.
The bank tells Asiamoney it has made personnel retention a priority, with all senior analysts on the equity research team having over 10 years of experience covering the market.
As for the Singapore stock market, 14 analysts cover just over 100 stocks listed there.
While the Straits Times Index (STI) climbed from 2,900 points at the end of 2016 to 3,400 points by the end of October – a 17% rise – the real value came from deep research in the small- and mid-cap names.
Janice Chua, head of equity research at the firm, tells Asiamoney the team managed to uncover a few of the hidden gems in those categories.
“We are among the few houses that cover those names, and have done very well after we initiated those calls,” she says.
Demand for technology names was one clear trend the bank anticipated, alongside some bullish calls on banks and property. DBS Vickers has strong real estate investment trust (Reit) coverage as well, helped by the fact that many of the Reit initial public offerings are managed by the in-house investment banking team at DBS.
All in all, that sector focus has helped the firm's picks outperform the STI by 3.4% in the first half of the year.
Chua adds that the firm tries to incentivise analysts to reach the most thought-through conclusions on stock calls, looking for the kind of undiscovered or overlooked information that can drive performance.
“We turned bullish on the property sector early this year, and followed up in July with an in-depth report on the upside potential from developers’ aggressive land banking bids,” says Chua. “With unsold inventory at its lowest level since 2001 and strong sales momentum in residential property, this underscores our belief that property prices are heading north. We turned out to be right.”
Top picks like UOL Group have benefitted from the bull run, up 60% in share value as of the beginning of November from a year earlier, while some of the hidden gems among the small caps have surged with, for example, mm2 Asia up five-fold since the team first highlighted it to clients in the middle of 2015.
The good times are not expected to end anytime soon, despite the prospect of Fed rate hikes.
The global growth picture is looking supportive, says Chua: “For Singapore, the stage is set for potential upside with abundant liquidity, export numbers exceeding expectations and a broader-based economic recovery. Sustained earnings growth, with potential upside, should mitigate the risks from normalising of interest rates.”