In the second part of this two-part series, we continue to highlight four front-running stocks that DBS recommends investors to invest in the new digital era.
Investors Takeaway: 4 Companies Leading Singapore’s Digital Transformation Race
- iFAST Corporation (iFAST)
iFAST has made significant progress in the last two to three years as a wealth management Fintech player. iFAST has broadened the range of investment products and services on its platforms over the last few years. iFAST is now a more integrated wealth management platform, with five key product group (unit trusts, ETFs, bonds, stocks and insurance). Apart from growing its range of services, it has also laid the infrastructure to kick-start its business in China, a market it believes will be key to future growth.
Despite a seventh consecutive quarter of record Assets under Administration (AUA) to $8.07 billion (+24.8 percent year-on-year), DBS believes that there is still room for growth. DBS notes that the current AUA level remains small relative to the size of the wealth management industry in Singapore and the other Asian markets it operates in.
BUY, TP $1.26; Current Share Price $1.05
- Singapore Airlines (SIA)
While SIA is at the forefront of fighting against disruptors in the aviation sector, DBS believes that SIA will emerge unscathed given its track record as one of the frontrunners in terms of digital transformation. For a long time, SIA has been challenged by 100 percent online distribution model of budget carriers. However, instead of going into a price war, SIA is leveraging on data analytics to offer personalized end-to-end travel experience to its customers. It is also leveraging on smart technology to improve productivity in moving passengers, baggage and cargo.
BUY, TP $12.00; Current Share Price: $10.70
- Y Ventures Group (Y Venture)
Y Ventures is a company that retails and distributes products from third-party brands over some of the largest e-commerce platforms (including Amazon and Lazada) across ten countries. However, unlike traditional distributors and e-commerce platforms, Y Ventures provides value-added data analytics services to brand partners. This allows Y Ventures’ brand partners to adapt their products to the market’s needs and in return, offer products at significant price discounts to Y Ventures. DBS believes that the data-driven approach to e-commerce in the retail sector is the new business model for retail players.
BUY, TP $0.77; Current Share Price: $0.47
- Singapore Post (SingPost)
SingPost’s share price has been subjected to the brunt of investors’ concern over logistics disruptors like NinjaVan and aCommerce. However, DBS thinks that SingPost is more than prepared to meet the challenge of these logistics disruptors after having pumped in so much money to invest for the future.
Over the years, SingPost has been investing in its infrastructure to prepare for the influx of ecommerce parcels. According to DBS, SingPost has already completed the integration of a regional warehouse and developed the fulfillment capabilities needed to meet the rising e-commerce demand in Asia. Its unique combination of automated parcel sorting facility (for rising e-commerce volumes), network of lockers (for pickups in Singapore) and digital solutions (adopted from other countries) will give SingPost an edge in providing better last mile delivery service than the logistics disruptors.
BUY, TP $1.55; Current Share Price: $1.27