Temasek to increase exposure in emerging sectors

Singapore-based investment company Temasek Holdings (Private) Ltd announced on Friday that it regarded China as a very important market and would continue to seek investment opportunities in the Chinese finance sector and those related to the nation's economic transition.

China was the second-largest investment destination for Temasek, with the nation accounting for 27 percent of Temasek's portfolios by underlying assets, following Singapore at 28 percent, according to its annual report as of March 31 this year.

It also said Temasek had a net portfolio value of S$266 billion ($197.2 billion) as of March 31, up S$43 billion from the previous year, with a 19.2 percent one-year total shareholder return for the year, underpinned by strong performance in Chinese and Singaporean investments.

"We have a good outlook on the Chinese economy in the long term and have great confidence in the Chinese finance sector," said Wu Yibin, head of Temasek China.

"We started our investments in China in banks as they are an economic barometer, and we will continue to seek other opportunities in insurance and consumer finance companies," said Wu.

Temasek has invested in Bank of China Ltd, China Construction Bank Corp, Industrial and Commercial Bank of China Ltd, China Pacific Insurance (Group) Co Ltd and Ping An Insurance (Group) Company of China Ltd.

Besides the financial sector, consumption, the Internet and life sciences will be important sectors for Temasek in China.

"We also believe China's economic transition is a good investment theme, such as State-owned enterprise reform and the Belt and Road Initiatives," said Wu, adding that the growing middle-class population, deepening comparative advantages and emerging champions are other good investment themes.

According to Wu, State-owned enterprise reform will be a long-term investment opportunity. As an investment company, Temasek would also pay attention to improving corporate governance structures and market efficiency when investing in a company.

The financial report also said that Temasek made S$30 billion in new investments, about half of which were in Asia, followed by North America and Europe.

During the financial year, Temasek pared its stake in China Construction Bank, while continuing to own the pre-IPO shares it has held since 2005. After the Alibaba Group Holding Ltd IPO in 2014, Temasek monetized around 10 percent of its stake in the firm.