Mumbai: Singapore’s Temasek on Tuesday said its net portfolio value had hit a record high of S$308 billion (US $235 billion) for the financial year ended 31 March.
“Our net portfolio value passed the S$300 billion mark for the first time. It is now almost three times the dotcom peak of just over S$100 billion at the turn of the millennium. We continue to reshape our portfolio in line with our views of key long term trends. This ongoing active investment stance is focused on solutions for a better, smarter and more connected world over the medium to long term,” said Lee Theng Kiat, executive director and CEO of Temasek International.
Temasek’s one-year total shareholder return stood at 12.19%, with compounded annualised returns of 15% since inception in 1974, the investment firm said in a statement. Dividend income from Temasek’s portfolio was recorded at S$9 billion for the financial year.
In the financial year ended 31 March, Temasek invested S$29 billion and divested investments worth S$16 billion, the statement added.
The investment firm, though generally positive on the outlook for the year ahead, said it expected global growth to moderate.
“We see the probability of increased downside risks in the near term. Our balance sheet and portfolio resilience give us the flexibility to ride out short-term market volatility, while delivering sustainable returns over the long term,” said Sulian Tay, managing director, investment, at Temasek.
Given the market outlook, the investment firm’s senior management said that it would adopt a disciplined approach to investing in the next 9-18 months. “We continue to maintain a disciplined approach. Given the market outlook, we may recalibrate and slow our investment pace over the next 9 to 18 months,” said Alpin Mehta, managing director, investment, at Temasek.
Mehta, however, added that Temasek did see a pipeline of opportunities for this year. “In particular, we will actively seek attractive opportunities in sectors and markets driven by transformational technologies, demographic shifts and changing consumption patterns,” he said.
On new investments, Temasek said that it had increased its focus on sectors such as technology, life sciences, agribusiness, non-bank and financial services. During the year ended 31 March, these focus sectors made up nearly half of Temasek’s new investments, totalling approximately S$13 billion.
“Together, our exposure to these focus sectors now constitutes about S$80 billion, or 26% of our total portfolio. This is up 9 times from S$9 billion, or an equivalent 5% share of a smaller portfolio in 2011,” Temasek said.
Technological advances, demographic shifts and changing consumption patterns were disrupting traditional business models and creating new opportunities for investors, Temasek said.
The Singapore based global investor is also keen on investing in early stage companies, both directly and indirectly through other funds and has built a substantial portfolio of such investments. Temasek’s early stage investments have focused on companies in sectors such as agribusiness, healthcare and digital media. “These early stage investments, including indirect investments through venture capital funds, now constitute just under 3% of our portfolio. These higher risk, and sometimes longer term, investments are one way for us to seed new solutions and capabilities, and deliver higher returns in aggregate over the longer term,” the firm added.
Temasek has offices in Singapore, New York, San Francisco, Washington DC, Sao Paulo and Mexico City, London, Beijing, Shanghai, Mumbai and Hanoi.