Temasek's Returns Disappointing!!!

last SG · 2006-02-06T17:59:22+00:00

See what is going on at Thailand now

ditzy SG

If you come to think of it, its only the writer writing into a public forum to express his displeasure over how Temasek Holdings is managing its funds, because after all his shares in the company are at stake. Laughing

tohyi SG

1% return is pathetic. if it was a private hedge fund with private investors, the investors will all be pulling out their money. so who is going to fire Ho Ching for achieving a 1%reutrn? The Prime Minister? there should be full transparency in GIC and Temasek. i just do not see where the check and balances come in when the Prime Minster is the Minister of Finance (MOF) and the only shareholder of Temasek is the MOF which is run by the PM's wife. The set up is a joke. How could we singaporeans buy into this whole set of family related appointments! Mad

charlize SG

Elections are coming.

You can try going to a PAP rally and asking the PAP candidate those tough questions when you have the chance. Laughing

Calvin86 SG

I got the picture. If Ho ching didnt make the mistake of buying micopolis, Temasek returns would have jumped 50%.

charlize SG

I say again.

Even FDs can beat the 1% annual return. Laughing

shade343 SG

Not all of Temasek's asset are in Cash. And I dont think any bank will accept 100billion in cash and give 2.2% in FD.

charlize SG

CB lah, only one bank in the whole world is it? Laughing

Salman SG

Much of the assets are in real estate.
Those people who suggest FD are ignorant.

charlize SG

My dear Salman, I was replying in the context of returns. IF FDs can yield a better return annually than their investments in other things, would it not be even possible to consider converting the other investments into cash and placing them into FDs?

Of course, we all know that you will conform to anything and everything the government tells you without regard for logic and reason.

Hence, like what other forumers are doing to you, I will start ignoring your ludicrous posts since logic and reason are beyond your capabilities. Laughing

AF2005 SG

actually the more than $120 billion are diverified into real estate, FD local and foreign currencies,loans, bonds, and includes share investment and fund management.

So i guess this round some of their investments are doing badly.

Salman SG

Originally posted by charlize:
My dear Salman, I was replying in the context of returns. IF FDs can yield a better return annually than their investments in other things, would it not be even possible to consider converting the other investments into cash and placing them into FDs?

Would that be possible?
You want a collapse of the local property market?
You want all lands in private hands?
Please explain how that can be done.

Of course, we all know that you will conform to anything and everything the government tells you without regard for logic and reason.

Hence, like what other forumers are doing to you, I will start ignoring your ludicrous posts since logic and reason are beyond your capabilities. Laughing

Conform you say? Nope, me not a conformer, thats why I question. Thats why I start me own business, unlike most of you who are conformed by the govt.

look_see SG

mr salman, have you heard of REITs? when u owe an asset, u need not just go thru selling/buying to generate a return?

this is not a wet market txn discussion we are having here

Salman SG

Oh I see, so you can declare increase in reserves w/o realising it.
So why didn't the govt do it and realise a 5% growth instead. Please explain.

shade343 SG

YOu are going slightly out of point. REITs are a financial product created to unlock the value of a property. So you dont have to just sell the properties 1 by 1. YOu can group a few of them together and issue Reit units to investors and float the Reit on the open market. YOu earn from selling the reit units and being the manager of the reit at the same time.

TH didnt form a reit yet because market conditions are not right.

shade343 SG

I would say that their portfolio is rather diversified. This is good because of the potential risk which they are hedging against.

shade343 SG

Ok. Give me an example of a bank which accepts 100billion and gives 2.2% in interest for that amount. Laughing

Put it this way: Investing comes with risk. The higher the yields, the higher the risk. Looking at Temasek's Portfolio, Im satisfied that they are diversified well enough to balance out the risk which they are taking.

dragg SG

from st forums.

Feb 7, 2006
Temasek's 30-year returns a robust 18%

WE REFER to The Straits Times Forum letter 'Temasek's returns disappointing' (ST, Feb 3) by Mr Jeffrey Ho Loon Poh.

Temasek measures total shareholder's return (TSR) by both market value and shareholder's funds.

TSR by market value considers the dividends received alongside the changes in market value of a portfolio less net new capital issued. This must necessarily reflect the volatility in the market, specifically the market value at the opening date versus the market value at the closing date.

The TSR results thus depend on which period is being evaluated. This can be seen in the chart below of the composite market capitalization of 11 of the major Temasek-linked companies (TLCs), including SingTel, DBS, SIA, Chartered, STATS ChipPac and others.

The five-year TSR from March 2000 to March 2005 would be drastically different from the five-year TSR from March 1999 to March 2004, depending on the market value at the respective points in time. These changes do not necessarily reflect the underlying profitability of the portfolio companies.

On the other hand, TSR by shareholder's funds considers the dividends received by the shareholder, plus the changes in the underlying net asset value of the portfolio, net of new capital issued. This is driven by the profitability of the businesses rather than the valuation in the stock market. Owners and long-term shareholders would regard these as fundamental to the sustainability of their businesses.

The five-year TSR to March 2005 mentioned by Mr Ho measures off the market high of March 2000 due to the dot.com boom. Thus, the five-year TSR for Temasek (1%), STI (2.7%) and MSCI Singapore Index (0.6%) were generally low but comparable. They are not exactly the same as Temasek portfolio value in 2000 was lifted by its large weightage in the telecoms and technology stocks.

On the other hand, the two-year TSR measures off the low market value of March 2003 in the depths of SARS. Here, Temasek delivered a strong 30%, though this is lower than the 31% for MSCI Singapore Index and 34% for STI. However, Temasek's three-year and 10-year TSR at 11% and 6% outperformed both the MSCI Singapore Index (6.4% and 2%) and STI (9% and 4.3%). Temasek's 30-year TSR remained a robust 18%.

These variations in the TSR numbers reflect the volatility of the market over the last decade or so. As we move into the future, the reported TSR numbers by market value will continue to fluctuate as we measure the different starting points in the past.

Leaving aside the market volatility effect on the market TSR numbers, the TSR by shareholder's funds showed a less volatile pattern, with a robust 9% return over the five years to March 2005, despite SARS and 9/11.

The one-year and two-year TSR by shareholder's funds climbed back to 12% and 14% respectively, signaling a stronger profit flow as the economy recovered. We assure Mr Ho that Temasek has the appropriate system to align management interest with long-term returns.

Eva Ho (Ms)
Director
Corporate Communications
Temasek Holdings (Pte) Ltd

charlize SG

My dear shady boy, can you think out of the box and split the damn money into smaller amounts into different accounts and different banks if you think the whole amount is too huge and that no bank will want to take it?

As for interest rates, as far as I know, the current FD rates for most of the local banks are already in the range of 2.5 to 3%. I even provide the link to FD rates from one of the local banks for you:

http://www.dbs.com/sg/personal/deposit/cnyfd/

Again, I answer this in the context of annual returns. Please don't do a Salman here by fudging a simple question with a simple answer with all sorts of nonsense counterquestions. Laughing

charlize SG

30 years return a ROBUST 18%.

Is that even less than 1% per annum? Laughing

shade343 SG

I get your point. But you must consider this. In terms of annual returns, FD gives 2.5%. However, investing in company stocks and bonds may give a potential yield of more than 10%. So between 2.5% and a potential 10%... which is the direction do you head for if you want to see your money grow substantially? And by the way, FD rates were only 1.2% just 2 years back. Laughing

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