The Asia Pacific (ex Japan) region offers a broad range of compelling income and growth opportunities in both developed and emerging markets, across sectors.

 

Along with Australia and Taiwan, we view Singapore as one of the most attractive developed markets within the region. Singapore provides a unique blend of developed and emerging market exposure: as well as offering developed market quality and corporate governance, it also acts as a gateway to large, growing emerging markets in the rest of Southeast Asia.

Asia’s powerhouse?

Singapore boasts the highest GDP per capita in Asia, arguably making it Asia’s most developed economy. It has a stable political system, and a progressive, well-functioning legal and regulatory framework, which is transparent and business friendly. It is home to a range of well-managed companies with strong corporate governance – many of whom are willing, and able, to pay out attractive dividends – and it is known worldwide as being a great place for expatriates to live and for businesses to operate from.

 

From a geopolitical point of view, Singapore is well positioned too, as it enjoys good relations with most of the world. Many multinational companies want to operate from Asia, and Singapore is increasingly becoming the preferred location for global businesses. It has been taking market share from Hong Kong, a trend that we believe is likely to continue, partly due to ongoing tensions between the West (particularly the US) and mainland China.

Gateway to Southeast Asia

Singapore also functions as a gateway to Southeast Asia, offering exposure to large, growing emerging markets in the region like Malaysia, Thailand, the Philippines and Vietnam, while adhering to high governance and regulatory standards.

 

By investing in Singapore instead of making direct investments in its neighbouring countries, we do not have to take on some of the risks associated with political systems that are not as conducive to long-term investment, liquidity that is often not as high, and valuations that are not as attractive when compared to their respective 10-year government bond yields.

Diverse opportunities

In the Jupiter Asian Equity Income strategy, we are top-down stock pickers, taking into consideration the macroeconomic environment to help us identify which countries we want to invest in. Then, within those countries, we look for the best “quality income” opportunities – companies that are highly liquid, with strong balance sheets, good governance, solid barriers to entry, and an ability to pay and grow dividends.

 

Given the attractive quality income opportunities available there, we have been overweight Singapore for some time. The four Singapore-listed companies we hold all operate in very different industries from one another, with no overlap, offering diversification.

 

Singapore Telecommunications (“SingTel”): SingTel is a top 10 holding in the strategy, which has performed well year to date. We believe the business is well managed and we applaud its focus on maximising value from its portfolio of investments and dividend policy. As well as being Singapore’s dominant telecommunications operator, it also owns Singapore’s second largest network in Australia (Optus) and has large stakes in Bharti Airtel in India, Advanced Info in Thailand, Telkomsel in Indonesia and Globe in the Philippines.

 

DBS Group: DBS is one of the largest regional banks in Asia Pacific, and it is often voted the best bank in Asia. It derives its earnings from across the region – from India, through Greater China and across Southeast Asia. It offers a generous dividend yield, and it does not look expensive to us, despite the strong outperformance of its share price.

 

ST Engineering: ST Engineering is the world’s largest airline maintenance, repair and overhaul (MRO) business. It benefits from more air travel within Asia, as well as into and out of the region. It also has a defence arm of its business, which is receiving more orders as governments are increasing their spending on defence. It also operates a Smart City business, which has won contracts in Singapore and elsewhere.

 

Genting Singapore: Genting Singapore is one of two casino operators in Singapore. It manages a large integrated resort which includes theme parks, such as Universal Studios, and helps to attract tourists to Singapore from across the region. We like its seven-year remodelling plan and are comforted by the large net cash position on its balance sheet.

The best of both worlds

Singapore offers a unique combination of developed market quality and governance and exposure to growing emerging markets in Southeast Asia. With a stable political environment, transparent legal framework and strong corporate governance, Singapore provides a favourable business environment for both Asian and multinational companies. We are able to identify a number of attractive “quality income” opportunities in Singapore, across sectors, providing us with diversified exposure. We believe each of these companies has the potential to continue to grow their businesses and to deliver attractive, and growing, income streams.

The value of active minds: independent thinking

 

A key feature of Jupiter’s investment approach is that we eschew the adoption of a house view, instead preferring to allow our specialist fund managers to formulate their own opinions on their asset class. As a result, it should be noted that any views expressed – including on matters relating to environmental, social and governance considerations – are those of the author(s), and may differ from views held by other Jupiter investment professionals.

Important information

This document is intended for investment professionals* and is not for the use or benefit of other persons, including retail investors. This document is for informational purposes only and is not investment advice. Company examples are for illustrative purposes only and are not recommendations to buy or sell. Market and exchange rate movements can cause the value of an investment to fall as well as rise, and you may get back less than originally invested. The views expressed are those of the individuals mentioned at the time of writing, are not necessarily those of Jupiter as a whole, and may be subject to change. This is particularly true during periods of rapidly changing market circumstances. Every effort is made to ensure the accuracy of the information, but no assurance or warranties are given. Issued in the UK by Jupiter Asset Management Limited (JAM), registered address: The Zig Zag Building, 70 Victoria Street, London, SW1E 6SQ is authorised and regulated by the Financial Conduct Authority. Issued in the EU by Jupiter Asset Management International S.A. (JAMI), registered address: 5, Rue Heienhaff, Senningerberg L-1736, Luxembourg which is authorised and regulated by the Commission de Surveillance du Secteur Financier. No part of this document may be reproduced in any manner without the prior permission of JAM/JAMI/JAM HK.

 

*In Hong Kong, investment professionals refer to Professional Investors as defined under the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong).and in Singapore, Institutional Investors as defined under Section 304 of the Securities and Futures Act, Chapter 289 of Singapore.

For professional investors in LATAM only

Past performance is not a guide to future performance and may not be repeated. Investment involves risk. The value of investments and the income from them may go down as well as up and investors may not get back the amount originally invested. Because of this, an investor is not certain to make a profit on an investment and may lose money. Exchange rates may cause the value of overseas investments to rise or fall.

Legal Notice for Residents in the Republic of Argentina: This document includes a private invitation to invest in securities. It is addressed only to you on an individual, exclusive, and confidential basis, and its unauthorised copying, disclosure, or transfer by any means whatsoever is absolutely and strictly forbidden. Jupiter Asset Management (Europe) Limited, will not provide copies of this document, or provide any kind of advice or clarification, or accept any offer or commitment to purchase the securities herein referred to from persons other than the intended recipient. The offer herein contained is not a public offering, and as such it is not and will not be registered with, or authorised by, the applicable enforcement authority. The information contained herein has been compiled by Jupiter Asset Management (Europe) Limited, who assumes the sole responsibility for the accuracy of the data herein disclosed.

Legal Notice for Residents in Brazil: The Funds may not be offered or sold to the public in Brazil. Accordingly, the Funds have not been and will not be registered with the Brazilian Securities and Exchange Commission (Comissão de Valores Mobiliários, the “CVM”), nor have been submitted to the foregoing agency for approval. Documents relating to the Funds, as well as the information contained therein, may not be supplied to the public in Brazil, as the offering is not a public offering of Funds in Brazil, nor used in connection with any offer for subscription or sale of Funds to the public in Brazil.

Aviso Legal para Residentes en Chile: ESTA OFERTA PRIVADA SE INICIA EL DÍA SEGUN LO ESTABLECIDO EN EL TITULO Y SE ACOGE A LAS DISPOSICIONES DE LA NORMA DE CARÁCTER GENERAL Nº 336 DE LA SUPERINTENDECIA DE VALORES Y SEGUROS, HOY COMISIÓN PARA EL MERCADO FINANCIERO. ESTA OFERTA VERSA SOBRE VALORES NO INSCRITOS EN EL REGISTRO DE VALORES O EN EL REGISTRO DE VALORES EXTRANJEROS QUE LLEVA LA COMISIÓN PARA EL MERCADO FINANCIERO, POR LO QUE TALES VALORES NO ESTÁN SUJETOS A LA FISCALIZACIÓN DE ÉSTA; POR TRATAR DE VALORES NO INSCRITOS NO EXISTE LA OBLIGACIÓN POR PARTE DEL EMISOR DE ENTREGAR EN CHILE INFORMACIÓN PÚBLICA RESPECTO DE LOS VALORES SOBRE LOS QUE VERSA ESTA OFERTA; ESTOS VALORES NO PODRÁN SER OBJETO DE OFERTA PÚBLICA MIENTRAS NO SEAN INSCRITOS EN EL REGISTRO DE VALORES CORRESPONDIENTE.

Legal Notice for Residents of Colombia: This is not an offer of securities in Colombia or to any Colombian national, citizen or resident of Colombia or a corporation or partnership organized under the laws of Colombia or having a principal place of business in Colombia (“Colombian Residents”). All information, statistics, data and projections provided herein (the “Information”) along with the prospectus of each one of the funds (the “Prospectus”) are not intended for distribution, promotion or marketing purposes to Colombian Residents. Both the Information and Prospectus: (i) have been drafted, prepared and listed for investment professionals and are not intended to be addressed to any individual investor or to the general public in Colombia; and (ii) does not constitute a public offer under the current provisions of Colombia as they are not being offered or addressed to an undetermined amount of people or to more than one hundred individually identified potential investors. The Information and Prospectus listed herein are not an invitation to subscribe for units in funds or any other fund managed by Jupiter (the “Funds”). Funds’ units mentioned in this Prospectus have not been, and will not be, registered under any applicable securities laws in Colombia. Therefore, they may not be publicly offered in Colombia or to or for the benefit of a Colombian Resident (as defined above). The Funds may not be distributed, promoted or marketed in Colombia or to Colombian residents, unless such promotion and marketing is performed by an authorized distributor in compliance with Part 3 of Decree 2555 of 2010 and any other applicable rules and regulations related to the promotion of foreign funds in Colombia as amended from time to time. The Information and Prospectus is listed for general guidance only, and it is the responsibility of any person or persons in possession of this documentation to inform themselves of, and to observe, all applicable laws and regulations of any relevant jurisdiction. Potential applicants for Fund’s units should inform themselves of any applicable legal requirements, exchange control regulations and applicable taxes in the countries of their respective citizenship, residence or domicile.

Legal Notice for Residents of Mexico: The securities have not been and will not be registered with the National Registry of Securities, maintained by the Mexican National Banking and Securities Commission and, as a result, may not be offered or sold publicly in Mexico. The fund and any underwriter or purchaser may offer and sell the securities in Mexico on a private placement basis to Institutional and Accredited Investors pursuant to Article 8 of the Mexican Securities Market Law.

Legal Notice for Residents of Paraguay: The Shares have not been registered with the Commision Nacional de Valores of Paraguay (CNV), neither with the Stock Exchange of Asuncion (BVPASA) and are being placed by means of a private offer. CNV nor BVPASA has not reviewed the information provided to the investor. This document is only for the exclusive use of specific investor in Paraguay and is not for public distribution.

Legal Notice for Residents of Peru: The funds have not been registered before the Superintendenciadel Mercado de Valores(SMV) and are being placed by means of a private offer. SMV has not reviewed the information provided to the investor. This document is only for the exclusive use of institutional investors in Peru and is not for public distribution.

Legal Notice for Residents of Uruguay: The sale of the securities qualifies as a private placement pursuant to section 2 of Uruguayan law 18,627. The securities must not be offered or sold to the public in Uruguay, except in circumstances which do not constitute a public offering or distribution under Uruguayan laws and regulations. The securities are not and will not be registered with the Financial Services Superintendency of the Central Bank of Uruguay. The securities correspond to investment funds that are not investment funds regulated by Uruguayan law 16,774 dated September 27, 1996, as amended.