Billion Dollar Club: CONSUMER GOODS CONGLOMERATES + CYCLICAL CONSUMER SERVICES + RETAILERS

Riding on the global boom in demand for luxury timepieces, The Hour Glass Ags extended its winning streak from last year’s BDC and has again been named the overall sector winner for the Consumer Goods Conglomerates + Cyclical Consumer Services + Retailers industry category. In addition, the leading watch boutique chain has been named top in class for its weighted ROE as well.

The Hour Glass began as one store at Singapore’s Lucky Plaza and has since grown to a network of more than 60 boutiques across the region. It was listed on the SGX in 1988.

In a recent interview with The Edge Singapore, group managing director Michael Tay recalls that the pandemic was one of the more remarkable chapters faced by the company and that overcoming the challenges has made it its “greatest achievement” and a “defining moment”. Tay explains that despite the restrictions on physical movements and space, The Hour Glass has already put in place digital channels where it can continue to engage with customers and its own people.

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As such, driven by the pick-up in demand for luxury timepieces, earnings grew consistently throughout the pandemic. However, Tay acknowledges there is now a “new equilibrium”. Yet, he is confident that by consolidating the company’s position and building on its already strong foundation, it can be like a kueh lapis and have multiple business layers to see it through sustainable growth.

Keppel, one of the leading Temasek-linked entities listed on the Singapore Exchange S68, has been ranked tops for returns to shareholders. For the three years taken into consideration, Keppel generated a CAGR of 35.5% in returns to shareholders. Part of the gain was driven by the distribution of former Sembcorp Marine S51 — which has been renamed Seatrium — shares following the merger of Keppel’s former core offshore and marine unit.

For years, Keppel has grown under its previous conglomerate model, with its heavy presence in sectors including offshore marine, real estate, telecommunications and energy.

Keppel, under CEO Loh Chin Hua, has put in place a new strategy, which has repositioned Keppel as an asset manager cum operator of various operating assets. By helping external investors to manage their capital put into operating assets, Keppel can collect a management fee, other recurring income, and also potential upside when the assets do well and can be divested for a gain, from which proceeds can be reinvested into new growth areas.

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Jardine Cycle & Carriage, a regular winner at the BDC in this category, has again been named winner in the growth in profit after tax category with a CAGR of 31% for the three years under review. The bulk of the company’s earnings come from automotive, financial services, and heavy equipment and mining. However, it has additional income streams from other sectors ranging from agribusiness to utilities and infrastructure, property, cement and consumer products.

Jardine C&C’s key stakes are in 50.1% held Astra, a prominent Indonesian group that operates in automotive, financial services, heavy equipment, mining, construction and energy, agribusiness, infrastructure, IT and property. Also, Jardine C&C holds 26.6% of Vietnam’s Truong Hai Group Corporation, a fast-growing business group with a market-leading position in automotive and interests in real estate and agriculture.