Sembcorp to join MSCI Singapore Index on Sep 1
Vivienne Tay
SEMBCORP Industries will be added to the MSCI Singapore Index from Sep 1, it announced on Friday (Aug 11).
The inclusion comes after the energy and urban solution provider’s market cap crossed the S$10 billion mark.
Launched in 1986, the MSCI Singapore Index covers around 85 per cent of the free-float-adjusted market capitalisation of the Singapore equity universe. It measures the performance of large and mid-cap Singapore companies with an average market cap of around S$14.4 billion as at Jul 31.
The index currently has 22 constituents, with banks DBS , OCBC and UOB and corporates such as Singtel and Keppel Corporation among its top 10. It is reviewed quarterly and rebalanced twice a year.
It also includes US-listed Singapore companies Grab Holdings and Sea Limited. This is unlike the Straits Times Index (STI), which tracks the performance of the top 30 companies listed on the Singapore Exchange (SGX).
Sembcorp, which is listed on the SGX’s mainboard, is also an STI constituent.
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Last month, analysts flagged mainboard-listed Sembcorp’s potential inclusion into the MSCI Singapore Index after the group’s market cap passed the S$10 billion mark. It stood at about S$10.6 billion as at Aug 10.
Inclusion in the index could be a catalyst for the group’s share price, noted Maybank analyst Kelvin Tan in a Jun 29 report.
Sembcorp’s shares rose as much as 2.6 per cent or S$0.15 to S$6.02 during the early trading session on Friday. The counter closed the day 0.7 per cent or S$0.04 cent higher at S$5.91.
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On Aug 4, the group posted a 56 per cent jump in net profit to S$608 million for the first half ended Jun 30, after exceptional items. The results beat analyst expectations, with analysts from DBS Group Research and Maybank raising their target prices on the energy player as they expect energy prices to remain elevated amid a tight power supply.
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