The Singapore depository receipts of (clockwise from top left) Ping An Insurance, Xiaomi and Meituan will be traded on the SGX. — Agencies
SINGAPORE: Retail investors in Singapore can invest directly in three more blue chip companies listed in Hong Kong.
The three are Ping An Insurance, an integrated financial, healthcare and eldercare service provider in China, Xiaomi, the world’s third-largest smartphone vendor and Meituan, the biggest online food delivery platform in China.
The Singapore depository receipts (SDRs) of these three Hong Kong companies will be traded on the Singapore Exchange (SGX), joining five other Hong Kong SDRs that started trading earlier, on Oct 30, 2024.
The five are tech giants Alibaba.com and Tencent, electric carmaker BYD, state-owned Bank of China and HSBC.
SDRs are financial instruments that represent ownership in a foreign stock or security, but which are listed on the SGX.
The concept is similar to American depository receipts of non-US companies listed on US stock exchanges.
SGX Group noted that the eight Hong Kong SDRs make up more than 40% of the benchmark Hang Seng Index.
This allows retail investors to ride on thematic trends such as the growth in artificial intelligence (AI), the global shift towards electric vehicles (EVs) and the rise in eCommerce activities, while at the same time benefitting from the stability and dividend yields offered by financials.
The first batch of eight SDRs in Singapore were linked to blue chip companies in Thailand and were launched on May 30, 2023, and April 1, 2024, enabling investors here to invest in Thai companies through the SGX.
They cover more than 40% of the benchmark SET50 Index and eight sectors. The eight Thai SDRs are linked to telco conglomerate Advanced Info Service, Delta Electronics, a beneficiary of the trend towards EVs and data centres, Gulf Energy, an energy producer with both conventional and renewable energy businesses, and Kasikorn Bank, which is in the small and medium enterprise and high-net-worth spaces.
Others include Siam Cement, a conglomerate with businesses in industrial materials such as cement, building materials, chemicals and packaging, Airport operator Airports of Thailand, CP All, which operates 7-Eleven convenience stores in Thailand and PTT Exploration and Production, Thailand’s national oil and gas company.
With these eight Thai and eight Hong Kong SDRs, the exchange now lists 16 such financial instruments. The SGX noted that as a product class, SDRs have been well received by the market.
Serene Cai, its head of securities trading, said: “The SDRs are seeing growing investor adoption from local and regional markets like Malaysia and South Korea.”
The daily average value of SDRs traded on the SGX has increased eight times since October when they were launched to S$4mil in February. — The Straits Times/ANN
