- The SGX All Healthcare Index has generated a 6.4% total return in the year-to-date, and maintains a dividend yield of 5.9%. This compares with the MSCI AC Asia Pacific Asia ex-Japan Health Care Index, which has declined 2.4% in Singapore dollar terms over the same period, and maintains a yield of 1.2%. The three best-performing components of the SGX All Healthcare Index are Singapore Medical Group (+165.2%), Health Management International (+65.9%) and Singapore O&G (+58.0%).
- The three Health Care trusts listed on SGX – First REIT, Parkway Life REIT and RHT Health Trust – have a combined market capitalisation of S$3.2 billion and have averaged a dividend-inclusive total return of 15.9% in the YTD. Both First REIT and PLife REIT reported earnings for the three months ended 30 September 2016 last month, while RHT will release its September quarter results tomorrow after the market close.
- HC Surgical Specialists was the latest healthcare company to list on SGX on 3 November 2016. It offered 30 million placement shares at S$ 0.27 each, with no public tranche, raising a total of S$8.1 million. The stock closed at S$0.55 on its trading debut, reflecting a 103.7% gain over its issue price.
Singapore’s healthcare sector has a combined market value of more than S$30 billion. According to the Global Industry Classification Standards (GICS®), the industry can be broken down into the following sub-segments – Health Care Equipment, Health Care Supplies, Health Care Services, Health Care Facilities, Biotechnology, and Pharmaceuticals.
The city-state also plays a key role in Asia’s healthcare industry, where multiple opportunities and challenges exist in the ongoing supply and demand for health services across the region. A recent Market Update published on 25 October 2016 highlighted the key drivers of Asia’s Healthcare Sector.
SGX Healthcare Index
The SGX All Healthcare Index comprises stocks that report at least half their revenues from healthcare in the last financial year, as well as REITs with investments in healthcare facilities. The Index, which is free-float and market capitalisation-weighted, consists of 27 constituents with a total market capitalisation of S$33.2 billion. The weightings of index components are capped at a maximum 10% at each periodical rebalance, so that it is better diversified across a range of stocks.
The SGX All Healthcare Index has generated a 6.4% total return in the year-to-date and maintains a dividend yield of 5.9%. This compares with the MSCI AC Asia Pacific Asia ex-Japan Health Care Index, which has declined 2.4% in Singapore dollar terms over the same period, and maintains a dividend yield of 1.2%.
The five best-performing constituents of the SGX All Healthcare Index are Singapore Medical Group (+165.2%), Health Management International (+65.9%), Singapore O&G (+58.0%), ISEC Healthcare (+31.1%) and Pharmesis International (+20.0%). They averaged a total return of 68.0% in the year-to-date and maintain an average dividend yield of 1.6%.
The table below details the five best-performing stocks of the SGX All Healthcare Index, sorted by YTD total returns. Click on each stock to visit its profile page on SGX StockFacts.
|Name||SGX Code||Market Cap in S$M||Total Return YTD %||Total Return 1 Yr %||Total Return 3 Yrs %||P/E||P/B||ROE %||Dvd Ind Yld %||GICS® Sub Industry Name|
|Singapore Medical Group||5OT||119||165.2||200.0||299.6||163.3||10.8||6.9||N/A||Health Care Services|
|Health Management Intl||588||336||65.9||78.9||289.4||50.8||5.9||12.6||0.4||Health Care Facilities|
|Singapore O&G||41X||273||58.0||75.7||N/A||42.9||10.4||29.8||2.3||Health Care Facilities|
|ISEC Healthcare||40T||149||31.1||8.5||N/A||29.3||2.7||8.3||2.1||Health Care Facilities|
Source: SGX, Bloomberg & SGX StockFacts (data as of 7 November 2016)
Of the 32 REITs and six stapled trusts listed on Singapore Exchange, two are classified by GICS® as Health Care REITs. They are First Real Estate Investment Trust and Parkway Life Real Estate Investment Trust.
Health Care REITs are trusts engaged in the acquisition, development, ownership, leasing, management and operation of properties serving the health care industry, including hospitals, nursing homes, and assisted living properties.
RHT Health Trust, categorised by GICS® under the sub-segment of Health Care Facilities, is the first business trust listed on SGX with India-based healthcare assets. It has a portfolio of 12 Clinical Establishments, four Greenfield Clinical Establishments and two Operating Hospitals located across India.
First REIT, Parkway Life REIT and RHT Health Trust have a combined market capitalisation of S$3.2 billion. In the year thus far, they have averaged a dividend-inclusive total return of 15.9%, bringing their one-year and three-year total returns to 16.6% and 50.4% respectively.
For the quarter ended 30 September 2016, First REIT reported a distribution per unit (DPU) of 2.12 Singapore cents, up 1.9% from the year-ago quarter. PLife REIT reported a DPU of 3.06 Singapore cents for the September quarter, down 8.8% YoY. First REIT registered a 6.3% YoY increase in net property income to S$26.6 million and a 6.5% rise gross revenue to S$26.9 million. For PLife REIT, its net property income gained 8.0% to S$26.2 million, while gross revenue rose 8.2% to S$28.1 million.
RHT Health Trust will report results for its second quarter ended 30 September 2016 after the market close tomorrow.
Parkway Life REIT, First REIT, and RHT Health Trust have weightings of 9.94%, 9.97% and 8.52% respectively in the SGX All Healthcare Index.
The table below details the three Health Care trusts, sorted by market capitalisation. Click on each stock to visit its profile page on SGX StockFacts.
|Name||SGX Code||Market Cap in S$M||Total Return YTD %||Total Return 1 Yr %||Total Return 3 Yrs %||P/B||Dvd Ind Yld %||Price vs 12M High %||Price vs 12M Low %|
|Parkway Life REIT||C2PU||1513||13.0||15.6||22.8||1.5||4.9||-6.1||13.5|
|RHT Health Trust||RF1U||704||18.4||18.9||82.2||1.0||8.7||-16.6||4.8|
Source: SGX, Bloomberg & SGX StockFacts (data as of 7 November 2016)
Latest Healthcare IPO
Earlier this month, HC Surgical Specialists (HCSS) listed on the Catalist board. It offered 30 million placement shares at S$ 0.27 each, with no public tranche, raising a total of S$8.1 million. The stock closed at S$0.55 on its 3 November trading debut, reflecting a 103.7% gain over its IPO price.
Of the S$6.2 million in net proceeds raised, S$2.8 million will go towards expanding HCSS’s business operations, while S$2.2 million will be designated for working capital, and the remaining S$1.2 million will be used to purchase equipment and for renovation work.
HC Surgical Specialists, with a current market capitalisation of S$83.4 million, is a medical services company which provides endoscopic procedures through a network of 10 clinics in Singapore. Its procedures include gastroscopies, colonoscopies, and general surgery services with a focus on colorectal procedures. The company’s clinics also provides treatments for haemorrhoids, anal abscesses, anal fissures, gallstones and inflammation of the gallbladder, hernias, colorectal cancer, stomach cancer, colonic diverticular disease, and cysts and lipomas. Click here for the company website.
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