Rising Sino-US tensions shine spotlight on Singapore stocks with Taiwan exposure
Uma Devi
THERE are altogether 18 Singapore-listed stocks with exposure to Taiwan in widely varying degrees, some of which could draw heightened trading activity in the near term if US-China tensions across the Taiwan Strait escalate.
Of these, 7 stocks on the Singapore Exchange have a market capitalisation of more than S$100 million and have “varied exposure” to Taiwan, according to SGX market strategist Geoff Howie.
For now at least, going by the share price movements or trading activity, these counters have yet to see much impact although market watchers do not rule out a closer look if geopolitical troubles over Taiwan drag on.
Trouble began when US House Speaker Nancy Pelosi visited the island on Aug 2, which raised concerns about an escalation of tensions. The visit has notably infuriated China, which regards Taiwan as its own territory. China has since embarked on the likes of military drills and test launches of ballistic missiles over Taiwan for the first time.
Latest media updates on Monday sounded the Chinese military’s intention to continue its exercises around Taiwan, with a focus on anti-submarine combat and sea assaults.
Two companies on the SGX draw their full revenue from Taiwan. Mainboard-listed Asian Pay Television Trust (APTT) – a business trust with a mandate to own and operate pay-TV & broadband businesses in Taiwan, Hong Kong, Japan and Singapore – is one of the counters.
APTT’s sole investment is in the Taiwan Broadband Communications Group (TBC), Taiwan’s third-largest cable TV operator. According to a Q1 business update by APTT on May 13, about 89 per cent of TBC’s revenue is derived from basic and premium cable TV subscriptions, as well as broadband subscriptions.
Another company that gets 100 per cent of its revenue from Taiwan is retailer Ossia International. The company markets and distributes a range of products including sporting goods, footwear and sports equipment.
According to the company’s website, it has a “strong presence” in Singapore, Malaysia, Taiwan and Hong Kong. Its business primarily involves importing and distributing apparel, sporting goods, footwear and accessories in Taiwan. In its latest annual report, Ossia said its subsidiary in Taiwan has exclusive distribution rights for brands such as Kangol, True Religion, Tumi, Columbia and Sorel.
Neither APTT nor Ossia has issued a statement on SGX about any impact to its operations due to the ongoing tensions in the Taiwan Strait.
Semiconductor player Global Testing sees nearly half of its revenue come from Taiwan. The company operates semiconductor testing businesses, and provides services such as wafer testing and finished product testing. According to data from SGX, Global Testing’s main facilities are in Hsinchu, Taiwan. Taiwan Semiconductor Manufacturing Company Limited is also one of the firm’s customers.
Other companies with significant exposure to Taiwan are entertainment company mm2 Asia and industrial services provider Mun Siong Engineering, with each deriving more than a quarter of their topline from the island.
mm2 Asia’s wholly-owned subsidiary mm2 Entertainment has a regional office in Taipei, and has also made local movies in Taiwan.
In Mun Siong’s financial results for H1 ended June, Taiwan was the second biggest contributor geographically to the group’s revenue after Singapore. Out of total revenue of S$30.6 million for the period, Taiwan contributed S$3.6 million.
Other Singapore-listed companies with smaller revenue contributions from Taiwan include Trek 2000, UMS Holdings and Audience Analytics.
