Temasek’s investments in China rises to 29%, surpasses Singapore

Temasek closed its financial year ended 31 March 2020, with a Net Portfolio Value (NPV) of S$306 billion . This was up S$120 billion over the decade, and almost tripled the NPV two decades ago.

One-year Total Shareholder Return (TSR) was -2.28 percent. TSR takes into account all dividends distributed to our shareholder, less any capital injections. The TSR since 1974 was an annualised return of 14 percent compounded over 46 years; 20-year TSR was 6 percent; and 10-year TSR was 5 percent.

During the year, Temasek invested S$32 billion; divested S$26 billion; and ended the year with a resilient balance sheet.

“A promising 2019 was cut short by the arrival of the Covid-19 pandemic in the last quarter of our financial year ended March 31. The resilience of our portfolio cushioned its worst effects,” said Lim Boon Heng, Chairman of Temasek Holdings.

Temasek’s portfolio remains anchored in Asia, with 66 percent exposure in the region by underlying assets. China and Singapore remained the top two countries by concentration, at 29 percent and 24 percent respectively.

Investments in China included Kuaishou Technology, a short video social platform; Beijing-Shanghai High Speed Railway; and Ocumension Therapeutics, an ophthalmic pharmaceutical platform company.

Additionally, investments in Singapore growth companies included ShopBack, a rewards and discovery platform; and Growthwell Group, which makes plant-based meat alternatives. These create longer term growth opportunities that complement our exposure in major Singapore holdings and efforts by Heliconia Capital to enable small and medium enterprises to scale beyond Singapore.

“We have continued to grow our portfolio in North America (17%), where we see opportunities in line with key structural trends.  The developed markets of North America and Europe (10%) now form over a quarter of our underlying portfolio exposure. Geographically, the US again accounted for the largest share of new investments during the year, followed by China and Singapore,” the company said in statement.

“With a resilient balance sheet, we have full flexibility to reshape and rebalance our portfolio, whenever opportunities or challenges arise. This allows us to invest for the longer term, take advantage of market dislocations, and work to reposition our portfolio for the future.

Financial services remained the largest sector in the company’s portfolio. Temasek also increase exposure to the payments sector and other non-bank financial services companies.

“We added to our stakes in PayPal, Mastercard and Visa and invested in emerging companies such as Blend.,” the company said.

Life sciences and healthcare investments included AIER Eye Hospital, CareBridge, an integrated healthcare system and  biopharma companies developing new drugs and therapeutic solutions such as Beam Therapeutics, Coherus BioSciences, Transcenta and Vir Biotechnology.

On the sustainability end, Temasek has committed to invest in negative emissions technologies and nature-based solutions.

“One key target is to reduce net emissions attributable to our portfolio to about seven million tonnes of CO2e3 by 2030. This represents half the estimated carbon emissions attributable to our portfolio in 2010 and approximately a quarter of the estimated emissions in 2020,” Temasek stated.

“While we remain watchful on the impact of Covid-19, we are also committed to building a more sustainable planet for ourselves, and for future generations. We recognise the urgent need for businesses with innovative solutions to improve lives and increase social resilience. This has led us to accelerate our investments into low-emission and resourceefficient companies, including in the areas of energy, food, waste, water, mobility and urban development,” said Dilhan Pillay, Chief Executive Officer, Temasek International.

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