Budget 2025’s household and business supports “should keep economic activities strong”, say analysts, while investment into innovation and boosting the equities market would open up “new opportunities for growth”.
In a Feb 19 note, JP Morgan’s analysts say retail landlords such as Frasers Centrepoint Trust (SGX:J69U
) (FCT) and CapitaLand Integrated Commercial Trust (SGX:C38U) (CICT) “should also benefit from increased supermarket spend via CDC and SG60 vouchers”.
Singaporean households will receive $800 in CDC vouchers. This will be given out in two tranches: $500 in May and $300 in January 2026. To mark Singapore’s 60th birthday, Singaporeans aged 21 and above this year will receive cash vouchers of up to $800. This will be given out in July. Each Singaporean adult will receive $600, while seniors aged 60 and above will receive an additional $200.
Another notable announcement that could impact local stocks is the extension and enhancement of tax concessions for S-REITs. These include extending the tax exemption on S-REIT qualifying foreign income and concessionary withholding tax of 10% to 2030 from 2025.
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Tax transparency treatment will also be expanded to co-location and co-working income from July 2025.
Extensions were also granted for tax concessions on REIT ETFs and GST remissions for S-REITs.
“We expect the extension of the tax concessions to continue to enhance the attractiveness of Singapore as a regional REIT listing hub,” says JP Morgan.
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Separately, the Singapore government will also invest $1 billion for a new national semiconductor R&D fabrication facility, and refresh Singapore’s public biosciences and medtech research infrastructure in one-north.
The analysts believe this will enhance the attractiveness of CapitaLand Ascendas REIT (SGX:A17U) ’s (CLAR) existing R&D facilities in one-north.
After marking an all-time high close price on Feb 18, the Straits Times Index has surged 0.27% higher as at 10am on Feb 19, to 3,936.030 points.
Even at JP Morgan’s “bull case” STI target of 4,200 points, or 7% above its current level, the benchmark index still offers about 4.5% dividend yield based on consensus estimates, “which is higher than most Asia ex-Japan markets,” say analysts.
JP Morgan’s top picks from the Singapore Exchange (SGX:S68) are DBS Group Holdings, United Overseas Bank (SGX:U11) , Singapore Telecommunications (SGX:Z74) , ST Engineering, CICT and Keppel DC REIT.
