SINGAPORE: Temasek Holdings announced a record net portfolio value for the last fiscal year on Tuesday (July 9) – the third consecutive year – even though the pace of investment has been pulled back to cope in a challenging environment.
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For the year ended March 31, the net portfolio value increased to S 308 billion $ in the previous year to S 313 billion annual review.
Shareholders' one-year total returns fell to 1.49 percent from 12.19 percent a year ago. Dividend income remained stable at $ 9 billion for the year.
Temasek remains cautious in the face of the macroeconomic headwind, which includes protracted trade between the United States and China.
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In the year under review, the state-owned investment firm in Singapore invested $ 24 billion and sold $ 28 billion. This was a reversal from the previous fiscal year when investments exceeded sales as Temasek accelerated the pace of sales in the face of macroeconomic headwinds, according to a press release from Brazilian paper maker Klabin. It also reduced its stake in Chinese Internet giant Alibaba and global technology company CenturyLink, but said that it continues to hold significant holdings.
The US accounted for the largest share of new investment, followed by Europe and China. Mature economies accounted for 60 percent of the Temasek portfolio, while emerging economies such as Latin America and Africa accounted for the remaining 40 percent. Overall, Asia remained the anchor of the Temasek portfolio at 66 percent, with Singapore and China playing a role of 26 percent each. Exposure to Europe (10 percent) and North America (15 percent) was expanded in line with emerging trends and opportunities.
Financial services (25 percent) remained the largest sector and new investments continued Focusing on non-bank financial technology and payment platforms such as China's Ant Financial
Technology, Media and Telecommunications at 20 percent also remained a key investment focus.
"In general, we manage our portfolio and liquidity for resilience, especially in anticipation of a challenging outlook. We were concerned about the downside risks last year and have deliberately mitigated our pace of investment, "said Chia Song Hwee, President and Chief Operating Officer of Temasek.
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LOOKING AHEAD Global Growth.
Temasek continues vigilant of the risks of a late-night recession in the US, while the risk of disorderly Brexit and political fragmentation continues to weigh on Europe.
China's outlook could come under more pressure The continued conflict with the US, he added This may be mitigated by awareness of macro-risks and policy space.
Overall, Temasek remains optimistic about China's t Mid-term performance due to timely and targeted reforms.
In Singapore, activity slows down alongside global growth, with the Downside risks from global tensions increase.
The potential for more trade and investment growing However, the ASEAN region could favor Singapore in the long run and some segments of the economy, including specialist, financial and technology services, are expected to remain stable.