Singapore sovereign wealth fund: The key number in the Temasek report
Divestments at the Singaporean sovereign wealth vehicle tell a story of a tough investment environment.
The most important number in Tuesday’s Temasek review for the Singaporean sovereign wealth vehicle was this: it divested S$28 billion ($20.6 billion) of assets, S$4 billion more than it invested.
This is what a dynamic equity-based portfolio looks like in the middle of a trade war. Temasek faces a challenging environment, given its mandate: it can’t retreat to cautious debt holdings or alternatives, as GIC can, but has to stay either in listed companies or pre-listing positions.
It has handled the environment deftly enough. In the year to March 31 it delivered a total shareholder return up 1.49% year on year, with the portfolio climbing S$5 billion to S$313 billion net; it is telling that the fund gained S$9 billion in dividends through the year, a contribution that has rarely been more crucial.
The message it’s trying to give is: times are tough, but we’ve got this
Surprisingly, divestments were often not in heavyweights but in companies key to the fund’s life science and tech investment themes: it moved out of Gilead Sciences, Cargill Tropical Palm and Klabin, while trimming its stakes in Alibaba, CenturyLink and IHS Markit.