Market Snapshot

Singapore stocks opened higher on Friday. STI rose 0.3%; Sembcorp Industries rose 2%; DBS rose 0.7%; OCBC edged lower after earnings.

Stocks in Focus

OCBC: The bank’s net profit for the first quarter fell on lower net interest income and higher operating expenses. Net profit for the three months ended Mar 31, 2025, stood at S$1.88 billion, compared with S$1.98 billion from the year-ago period, it said on Friday. The earnings beat the S$1.86 billion consensus forecast in a Bloomberg survey of five analysts. Net interest income for the quarter fell 4 per cent to S$2.35 billion, due to a falling interest rate environment. Net interest margin was down 23 basis points to 2.04 per cent for the quarter, from 2.27 per cent in the previous corresponding period. Shares of OCBC closed 0.7 per cent or S$0.11 lower at S$16.16 on Thursday, before the announcement.

ST Engineering: The group’s revenue rose 8 per cent to S$2.9 billion for the first quarter ended March, from S$2.7 billion in the corresponding year-ago period, on the back of broad-based growth across all segments. In a business update on Friday, the group said this was led by “very strong growth” in its defence and public security segment, of which revenue jumped 18 per cent year on year to S$1.3 billion, from S$1.1 billion. Revenue from its commercial aerospace division edged up 0.1 per cent to S$1.153 billion from S$1.152 billion, while revenue from its urban solutions and satellite communications business rose 4 per cent to S$446 million from S$429 million. The group also reported contract wins amounting to S$4.4 billion for Q1, bringing its order book to S$29.8 billion as at Mar 31. Some S$7.3 billion of these contracts are expected to be delivered this year. Shares of ST Engineering closed 1 per cent or S$0.08 lower at S$7.51 on Thursday.

Frasers Property: The company posted a 147.6 per cent jump in net profit to S$142.2 million for the first half ended Mar 31, 2025, from S$57.4 million in the same period a year earlier. The surge was largely due to a net tax credit of S$6.1 million, reversing a tax expense of S$117.5 million in the prior year, the real estate developer said on Friday. The group attributed the credit to the reversal of tax provisions subsequent to finalisation. Excluding the tax reversal, attributable profit dropped 13.5 per cent. Shares of Frasers Property closed flat at S$0.81 on Thursday. 

Far East Orchard: The hospitality and student housing player’s net profit more than doubled to S$17.3 million for the first quarter ended Mar 31, 2025, from S$6.9 million the previous corresponding period, the company announced on Thursday. The significant rise in its Q1 net profit was driven by a one-off gain of S$9.2 million from the acquisition of an additional 6.7 per cent interest in Woodlands Square in January 2025, it added. This gain arose from the higher fair value of net assets acquired compared to the purchase consideration. However, revenue for the period fell 8.6 per cent to S$46.5 million, while operating profit declined by 4.4 per cent to S$17.3 million. These declines were attributed to reduced contributions from the hospitality business, which was affected by ongoing refurbishment works at Rendezvous Hotel Perth Scarborough. Shares of Far East Orchard closed 1 per cent or S$0.01 lower at S$1.04 on Thursday, before the announcement.

Daiwa House Logistics Trust (DHLT): The manager announced on Friday that its distributable income for the quarter was 9.9 per cent lower at S$8.2 million, down from S$9.2 million in the same year-ago period. This was mainly attributed to increased interest expenses from additional borrowings, higher interest rates due to the refinancing and restructuring of loans, and lower realised exchange gains. Units of DHLT closed at 1.8 per cent or S$0.01 higher at S$0.575 on Thursday.

SG Local News

Singapore's OCBC Maintains 2025 Guidance Despite Challenging Outlook

OCBC, Singapore's second largest bank, maintained 2025 guidance and set aside credit allowances, citing a challenging economic outlook after posting on Friday a 5% drop in first-quarter net profit that beat expectations.

OCBC maintained all of its 2025 financial targets, including net interest margin in the region of 2% and credit costs in the range of 20 to 25 basis points, according to Wong's presentation slides accompanying the earnings results.

OCBC, which is also Southeast Asia's second-largest lender, said January-March net profit fell to S$1.88 billion ($1.45 billion) from a record S$1.98 billion a year earlier, mainly on lower net interest income. It was OCBC's first on-year quarterly net profit drop since the first quarter of 2022.