• In August, multiple signs of an improving outlook for manufacturing and trade, have included a four-month high in ASEAN Manufacturing PMI expectations, a projected recovery in Singapore's manufacturing sector driven by strong electronics demand, and a significant month-to-month rebound in Singapore's Industrial Production in July.
   
• Since 6 August, the iEdge SG Adv Manufacturing Index has rebounded 5%, recovering most of the declines in the first week of the month. While the Index generated a flat total return in the 2024 year to 28 August, combined trading turnover of the constituents is up 10% from 2023, reaching S$223 million in daily share transactions. 
   
• For the month, the top-performing actively traded stocks in the iEdge SG Adv Manufacturing Index included SATS, UG Healthcare, Medtecs Intl, ThaiBev, and Willas-Array. Notably, SATS and ThaiBev were also among the three stocks of the Index that have booked the highest net institutional inflow for the month, along with ST Engineering.

Manufacturing Index Stocks Driving Trading Turnover Growth in 2024

The iEdge SG Adv Manufacturing Index measures the performance of SGX-listed companies within the global manufacturing ecosystem, that maintain substantial revenue reach throughout APAC. 

The fluid outlook for interest rates has been an overarching driver for most sectors represented by the Index in August. Since 6 August, the iEdge SG Adv Manufacturing Index has rebounded by 5%, reducing the August month-to-date decline in total return to 1%. 

The relatively flat 0.4% iEdge SG Adv Manufacturing Index total return for the 2024 year through to 28 August, generally aligns with Singapore’s Industrial Production contracting by 1.0% over the first seven months of the year. Despite this, the combined trading turnover of the Index constituents has risen by 10% from 2023, reaching S$223 million in daily share transactions in 2024. 

The table below highlights the stocks within the more actively traded side of the Index that have seen the largest increases in trading turnover this year.

Note ADT refers to Average Daily Trading Value, NIF refers to Net Institutional Inflow, ^ on SGX Watchlist. All Data as of 28 August 2024, Source: SGX

Improving Outlook for Manufacturing & Trade

Though August, there have been multiple signals that the cautiously optimistic outlook for manufacturing and trade is improving: 

• S&P Global  noted in their July ASEAN Manufacturing PMI Report that the start of the third quarter saw expectations for  the next 12 months reach a four-month high.
• Singapore’s non-oil domestic exports (NODX) surged by 16% YoY in July, a significant rebound from the 9% decline in June, driven by a 12% MoM expansion as well as favorable base effects.
• Singapore’s 2Q24 GDP report indicated Singapore’s manufacturing sector is expected to gradually recover in the second half of the year, with the electronics cluster projected to see strong growth due to robust demand for smartphone, PC, and AI-related chips.
• The GDP report also relayed the recovery in manufacturing, particularly in electronics, is expected to benefit trade-related services sectors such as machinery, equipment, and supplies. 

Singapore's Industrial Production rebounded 10% MoM and 2% YoY in July, driven by a recovery in electronics. Electronics, which make up nearly half of the sector and are heavily weighted towards semiconductors, saw a 2% YoY increase in July compared to a -11% YoY decline in June. 

Stocks Leading the iEdge SG Adv Manufacturing Index in August

For the month through to 28 August, the top-performing actively traded stocks in the iEdge SG Adv Manufacturing Index included SATS, UG Healthcare Corporation, Medtecs International Corporation, Thai Beverage, and Willas-Array Electronics (Holdings). Of the 10 actively-traded Index stocks that led the Index for the period, six were also among the 10 that led the Index in the rebound from the 6 August lows. These included UG Healthcare Corporation, Medtecs International Corporation, SATS, Pacific Radiance, Thai Beverage and Singapore Technologies Engineering. Frencken Group, Sarine Technologies, ASL Marine, and First Resources were also among the 10 active that led the Index from 6 August. 

Regional healthcare concerns this month saw UG Healthcare Corporation and Medtecs International Corporation outpace Top Glove Corporation Bhd and Riverstone Holdings. However, UG Healthcare and Medtecs International were in the red for the year up to 28 August 2024, while Top Glove and Riverstone Holdings posted respective price gains of 9.8% and 27.7%.

Notably, SATS and Thai Beverage were also among the three stocks of the Index that have booked the highest net institutional inflow for the month, along with ST Engineering. For the period, the 10 active stocks of the Index that saw the most prices gains within the Index, and 10 stocks that led the net institutional inflow within the Index are tabled below.

Note, NIF refers to Net Institutional Inflow,. All Data as of 28 August 2024, Source: SGX

Meanwhile AEM Holdings, Mermaid Maritime, Global Invacom Group, Beng Kuang Marine and Tianjin Pharmaceutical Da Ren Tang Group Corporation booked the most decline among the Index actives for the month through to 28 August. At the same time Yangzijiang Shipbuilding, Seatrium, UMS Holdings, Keppel Infrastructure Trust and Frencken Group saw the most net institutional outflow for the month through to 28 August.

Yangzijiang Shipbuilding Leads Index Weight Post March Rebalance

The iEdge SG Adv Manufacturing Index is reviewed semi-annually in March and September and Index constituents will have their Index weights capped at 10% at each semi-annual rebalance date. the wide span of revenue classifications for Sector Criteria detailed in Section 10 of the Index Methodology document found here.

Since the last rebalance (and capping process) in March, Yangzijiang Shipbuilding (Holdings) comparative performance has seen the stock now rank as the largest Index weight, with a current weight of 13.96%. 

On 12 August, Yangzijiang Shipbuilding reported a 15.3% YoY increase in revenue for 1HFY24 (ended 30 June), reaching RMB 13.0 billion, with the core shipbuilding segment contributing 95.0% of total sales. The segment's revenue improved by 16.3% to RMB 12.4 billion due to increased construction activities and better pricing of newbuild vessels, with the Group delivering 35 vessels and achieving 59% of its annual delivery target. The stock has generated a 66.4% price gain in the 2024 year to 28 August.

The most active stocks of the Index this year are tabled below.

Note ADT refers to Average Daily Trading Value, NIF refers to Net Institutional Inflow, ^ on SGX Watchlist. All Data as of 28 August 2024, Source: SGX

Further Resources and Research

• iEdge SG Advanced Manufacturing Index: Factsheet | Methodology
• Weekly Fund Flow Report: Data Reports - Singapore Exchange (SGX)
• Inside Insights: Director acquisitions rebound after earnings reporting season
• Inside Insights: SIA Leads Buyback Consideration, Multi-Chem CEO Trims 69% Stake

Recent Financial Results/Business Updates

• SATS: SATS 1QFY25 Results
• UG Healthcare: UG Healthcare 1H FY24 Financial Statements
• Medtecs International: Medtecs International 1H2024 Financial Statements
• Thai Beverage: Thai Beverage 9M24 Business Update
• Willas-Array Electronics: Willas-Array Electronics 2023/24 Annual Report
• ST Engineering: ST Engineering 1H2024 Financial Results

Related Analyst Reports

• AEM Holdings: DBS - AEM Holdings Ltd update : Not a “chip” bargain yet
• Mermaid Maritime: Lim & Tan - Mermaid Maritime Initiation : Mermaid: Seas the day!
• Dyna-Mac: OCBC - Dyna-Mac Holdings Update : Out of this world
• Beng Kuang Marine: Maybank – Beng Kuang Marine Initiation : Potential FPSO multi-bagger
• ST Engineering: DBS - ST Engineering update : Powering ahead in growth
• SATS: DBS - SATS update : Outperformance across all metrics
• Thai Beverage: DBS - Thai Beverage Public Company update : Early green shoots of beer business recovery
• ST Engineering: DBS - ST Engineering update : Powering ahead in growth

Company interviews 

• Mermaid Maritime: kopi-C with Mermaid Maritime’s Chief Operating Officer: ‘The oil and gas industry remains vital’
• Dyna-Mac: kopi-C with Dyna-Mac’s CEO: ‘We went from near-bankruptcy to having a record order book’
• Beng Kuang Marine: Beng Kuang Marine Charts Transformation Journey
• Medtecs International: Medtecs Builds Resilience for Sustainable Growth
• Willas-Array Electronics: 10 in 10 with Willas-Array Electronics - Engineering Sustainable Growth
• AEM: AEM Thrives on Technology’s Cutting Edge

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