Every investor dreams of owning shares that they can pass on to their children or relatives.
To achieve this, the company must have compelling characteristics such as a robust business model, a long history of growth and an outstanding management team.
Blue-chip stocks are a category of stocks that meet these criteria because they are large companies that have weathered good times and bad.
Most of them also pay a dividend, helping you generate passive income.
Here are four blue-chip Singapore stocks that we believe you can buy and own forever.
DBS Group (SGX: D05)
DBS needs no introduction as it is the largest bank in Singapore by market capitalization.
The lender has a rock-solid reputation and a strong track record in financial performance.
Investment firm Temasek Holdings also owns 29.05% of DBS since February 7, 2024.
The group reported excellent results for the first quarter of 2024 (1Q 2024).
Net interest income increased 8% year-on-year to S$3.6 billion, reflecting higher overall interest rates.
Fee income increased 23% year-on-year to S$1 billion, bringing DBS’s total revenue up 13% year-on-year to S$5.6 billion.
The bank’s net profit improved 15% year-on-year to 2.95 billion Singapore dollars – a new high.
An interim dividend of S$0.54 was announced, 42% higher than the S$0.38 paid a year ago.
Singapore Exchange Limited (SGX:S68)
Singapore Exchange Limited or SGX is Singapore’s sole stock exchange operator.
The stock exchange operator has a platform for buying and selling a wide variety of securities such as stocks, bonds and derivatives.
SGX enjoys a natural monopoly position as it is the only stock exchange operator in Singapore.
The Group announced solid results for the first half of its fiscal year 2024 (1H FY2024), ending 31 December 2023.
Revenue increased 3.6% year-on-year to S$592.2 million, while adjusted net profit (excluding extraordinary and non-recurring items) increased 6.2% year-on-year to S$251.4 million.
The exchange operator also paid a quarterly dividend of S$0.085, a slight increase from the S$0.08 paid a year earlier.
SGX has been busy launching new products to expand the range of securities that investors can trade and hedge their investment portfolios.
In March, the blue-chip group announced that it planned to launch interest rate derivatives in the second half of this year to meet strong demand for additional risk management tools.
Just last month, SGX added five new Singapore Depository Receipts to provide investors with more options to invest in the Thai stock market.
Frasers Centrepoint Trust (SGX:J69U)
Frasers Centrepoint Trust or FCT is a suburban retail REIT with a portfolio of nine shopping centres and one office building.
The REIT’s assets under management (AUM) were approximately S$7.1 billion as of March 31, 2024.
Due to its portfolio of resilient suburban shopping centers, FCT is an excellent REIT candidate for long-term ownership.
These malls attract customers from the surrounding HDB estates and ensure that tenant revenues remain high, creating strong demand from vendors seeking to locate in the REIT’s mall portfolio.
For the first half of its fiscal year 2024 (H1 FY2024), which ended March 31, 2024, FCT reported solid financial results.
Gross revenue decreased 7.2% year-on-year to S$172.2 million due to the disposal of Changi City Point and the Asset Enhancement Initiatives (AEIs) at Tampines 1 mall.
Net property income (NPI) fell 8.4% year-on-year to S$124.6 million.
However, distribution per unit (DPU) only fell by 1.8% year-on-year to S$0.06022.
Despite the slight decline in DPU, FCT maintained strong operating metrics with 99.9% utilization.
Rent turnover was also positive at 7.5% in the first half of fiscal 2024, while both footfall and tenant sales improved year-on-year in the second quarter of fiscal 2024.
CapitaLand Ascendas REIT (SGX:A17U)
CapitaLand Ascendas REIT or CLAR is Singapore’s oldest industrial REIT with a portfolio of 227 industrial properties.
Its assets under management amounted to S$16.9 billion as of March 31, 2024.
CLAR has a diversified tenant base of around 1,790 tenants, with the top tenant Singtel (SGX: Z74) and account for only 3.2% of gross rental income (GRI).
In addition, no single property contributed more than 4% to the GRI, ensuring that the industrial REIT remains robust even in different economic cycles.
The occupancy rate of the CLAR portfolio was also high at 93.3%, along with a strong positive rental yield of 16%.
The REIT is also undertaking five asset-in-process (AEIs) valued at approximately S$551 million to enhance the quality of its portfolio.
These projects will be completed gradually from Q3 2024 to Q1 2026.
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Disclosure: Royston Yang owns shares of DBS Group and Singapore Exchange Limited.
The post 4 Singapore Blue-Chip Stocks You Can Buy and Hold Forever appeared first on The Smart Investor.
