Temasek Holdings reported a record net portfolio value that crossed S$400 billion for the first time, while predicting a slower investment pace ahead.
In the financial year ended Mar 31, its net portfolio was valued at S$403 billion, an increase of S$22 billion from the S$381 billion it achieved a year ago, according to its latest annual review.
This is a smaller growth than in the previous financial year of 2020/2021, when Temasek reported a S$75 billion increase, or nearly 25 per cent spike in its net portfolio value. It was a turnaround from the financial year of 2019/2020, which saw a 2.2 per cent drop in net portfolio value due to the COVID-19 pandemic.
Its one-year total shareholder return, which considers all dividends distributed to the shareholder minus any capital injections, stayed positive at 5.81 per cent, lower than the 24.53 per cent a year ago.
The 10-year and 20-year total shareholder returns came in at 7 per cent and 8 per cent respectively, similar to figures in the previous year.
“Amid the uncertainty in global markets, we steadily invested and divested to capture opportunities aligned with long-term structural trends,” Temasek Holdings said in a media release.
“We aim to construct a resilient and forward-looking portfolio, with sustainability at the core of all that we do.”
Temasek said it invested S$61 billion and divested S$37 billion in the last financial year, investing more but divesting less than the year before.
In the 2020/2021 financial year, Temasek invested S$49 billion and divested S$39 billion.
Overall, Asia remained the anchor of Temasek’s portfolio at 63 per cent, with Singapore (27 per cent) and China (22 per cent) remaining the top two markets.
“For China, our exposure has decreased and this is due to the drop in the market value of our China portfolio. But China has consistently performed well for us over the decade, and we remain confident in its fundamentals and longer-term outlook,” said managing director of Temasek International’s strategy office and deputy head of organisation and people Lim Ming Pey.
Alongside the financial services (23 per cent) and telecommunications, media and technology (18 per cent) sectors, transportation and industrials, which includes investments in energy and resources emerged as one of the biggest sectors in Temasek Holdings’ portfolio.
Temasek Holdings will continue to focus on consumer, media and technology, life sciences and agri-food as well as non-bank financial services companies, guided by its view of trends and that opportunities in sectors are “converging”.
Investments in these sectors made up 33 per cent of Temasek Holdings’ overall portfolio in the last financial year.
“We have reshaped our portfolio over the last decade to be more resilient, especially as we anticipated intersections across sectors, and an increasing pace of disruption,” said Temasek’s head of west coast and deputy head of technology and consumer Martin Fichtner.
“Seeing opportunities through the lens of structural trends allows Temasek to bring together the expertise of our sector and market teams, as well as the connectivity of our partnerships and platforms.”
According to the investment firm, its unlisted assets, which make up 52 per cent of its portfolio, outperformed its listed assets. Temasek Holdings’ unlisted assets saw a 16.2 per cent internal rate of return over the last 20 years, compared to 6.7 per cent from its listed assets.
