Singapore’s Temasek postes net portfolio value of $286.9 billion

July 15, 2022 | 10:13
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The Singaporean state-owned fund Temasek – one of the world’s largest investors – reported a net portfolio value of S$403 billion ($286.9 billion) for the last financial year, an increase of S$22 billion ($15.6 billion) on-year.
Singapore’s Temasek postes net portfolio value of $286.9 billion

Temasek said on Tuesday that its total shareholder returns (TSR) stood at 5.81 per cent in the 12 months to March. It means that since its inception in 1974, Temasek's TSR was an annualised 14 per cent compounded over 48 years, while its 20-year and 10-year TSRs were 8 per cent and 7 per cent compounded annually, respectively.

Against the uncertainties in the global market, Temasek steadily purchased and sold assets to take advantage of opportunities in line with long-term structural trends. It seeks to build a resilient and future-proof portfolio by emphasising sustainability at the core of all its activities.

During the year, Temasek invested S$61 billion ($43.4 billion) and divested S$37 billion ($26.3 billion) of assets. Its strategies to build a resilient portfolio include investing in opportunities that match long-term structural trends and deploying capital to reposition its key portfolio companies for growth post-pandemic.

Following a decade of reshaping the portfolio to make it more resilient, Temasek expects investment across various sectors and locations. Temasek's portfolio construction follows long-term structural trends that are interconnected, transcend sectors and countries, and are resilient to economic cycles.

In terms of portfolio exposure, the three largest sectors are financial services (23 per cent), transportation and industrials (22 per cent), and telecommunications, media, and technology (18 per cent).

Temasek also focuses on companies in the fields of consumer sales, media, and technology, life sciences, and agri-food, as well as non-bank financial services. Investments in these sectors account for 33 per cent of Temasek's overall portfolio, a considerable rise from their 5 per cent share in 2011. The investments are also guided by the view that opportunities in different sectors are converging.

Meanwhile, Temasek's investments also span across different regions with 63 per cent of its portfolio remaining anchored in Asia. Singapore (27 per cent) and China (22 per cent) continue to be the company's two largest countries by exposure. However, Temasek has continued to grow its portfolio exposure in the Americas (21 per cent) and in Europe, the Middle East, and Africa (12 per cent), in line with emerging trends and opportunities.

According to Dr Steve Howard, Temasek’s chief sustainability officer, Temasek has accelerated its efforts to invest in climate-aligned opportunities, enable carbon negative solutions, and encourage decarbonisation efforts in businesses. To accelerate the pace of decarbonisation, we continue to engage with our portfolio companies to grow the capacity for sustainability, leadership, and climate transition management. Temasek engages its stakeholders and partners to share perspectives, forge partnerships, and catalyse solutions for a low carbon future.

"While a range of factors will make the future more difficult and unpredictable, we recognise that there is tremendous scope to work together to overcome our global challenges. I am confident that we will rise to the occasion knowing that a difficult environment brings out the very best in us. We stay committed to performing well and always doing the right thing as a firm so every generation can prosper," said Chia Song Hwee, Temasek’s deputy chief executive officer.

By Temasek

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