Regional News

Private equity (PE) deal value in Southeast Asia (SEA) saw a notable decline in Q2 2025, with $1b deployed across 22 PE-backed deals, a stark contrast to the $5.3b across 20 deals in the same period last year. This drop, despite a 10% increase in deal volume year-on-year, is attributed to the absence of mega deals that characterised 2024, according to the EY Southeast Asia Private Equity Pulse report.

The financial services sector led the investments, accounting for 29% of the total, driven by a focus on emerging technology and consumer demand. Technology and healthcare followed closely, with 28% and 27% respectively. Singapore and Vietnam were the most active regions, contributing over 55% of the deal volume and 74% of the deal value.

PE-backed exits in the region were valued at $398m across eight deals, with secondary transactions gaining momentum due to muted IPO activity and increased liquidity needs. Luke Pais, EY-Parthenon Asia-Pacific Private Equity Leader, noted, “Whilst the short-term headwinds on mergers and acquisitions persist, it also serves as a catalyst for companies in SEA to explore new growth pathways and build operational excellence.”

Investor caution is heightened by uncertainties around future trade policies and potential portfolio impairments from disrupted trade flows. Globally, 76% of general partners cited tariff-driven uncertainty and macroeconomic outlook as significant impediments to the transactions markets.

Despite these challenges, opportunities remain for PE firms in areas such as growth capital, private credit expansion, and infrastructure investment, particularly in nations absorbing relocated manufacturing. These dynamics are expected to reshape regional PE opportunities, offering new avenues for investment and growth.
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Singapore Airlines has reported a significant decline in its net profit for the first quarter of the financial year 2026, with figures showing a 59% year-on-year decrease to SGD186 million. This drop is largely attributed to lower interest income and substantial losses from its associate, Air India. Despite a 1.5% increase in revenue to SGD4.79 billion, driven by record passenger volumes, the airline’s bottom line was heavily impacted by Air India’s performance, according to a DBS Research report.

SIA’s operating profit for the quarter stood at SGD405 million, a 14% decrease from the previous year, yet it remained in line with expectations. The airline’s passenger yield fell by 2.9%, with Scoot experiencing a sharper decline of 4.7%. Cargo operations also faced challenges, with yields dropping by 4.4%.

The airline has maintained its “HOLD” rating, with a revised target price of SGD6.50, up from SGD6.40. This adjustment reflects a 9% increase in forecasted operating profits for FY26, attributed to higher passenger load factors. However, net profit estimates for FY26 and FY27 have been reduced by 12% and 8%, respectively, due to the ongoing issues with Air India.

Air India’s restructuring and reputational challenges continue to pose a significant risk to SIA’s financial performance. The airline’s management has acknowledged the uncertainty surrounding Air India’s path to profitability, particularly following a recent incident that led to a 20% drop in bookings and a decline in average fares.

Looking ahead, DBS Research anticipates continued pressure on yields, although the rate of decline is expected to moderate. The airline is also facing inflationary pressures, which are likely to drive up ex-fuel unit costs. Despite these challenges, SIA remains committed to its premiumisation efforts, with a SGD1.1 billion investment aimed at enhancing its service offerings by 2030.
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Capitaland Ascott Trust (CLAS) has reported a 6% year-on-year increase in gross profit for the first half of 2025, reaching SGD182.5 million, driven by acquisitions and a recovery in revenue per available room (RevPAR). However, the distribution per unit (DPU) saw a slight decline of 1% year-on-year to 2.53 Singapore cents, attributed to fewer one-off income items compared to the previous year, according to a DBS Research report.

The trust’s portfolio RevPAR rose by 3% year-on-year to SGD159 million in the second quarter, bolstered by strong performances in overseas markets such as Australia, the US, and the UK. This growth offset a 3% decline in Singapore’s RevPAR, which faced challenges from increased supply competition.

CLAS continues to focus on asset enhancement initiatives (AEIs) and acquisitions to drive future growth. The completion of Somerset Liang Court in 2026 is expected to increase the room count of its Singapore portfolio. The trust is also leveraging its asset recycling strategy, with a healthy gearing of 40% and SGD1.8 billion in debt headroom, to pursue growth opportunities.

The trust issued SGD260 million in perpetual securities at a 4.2% coupon rate in May 2025, replacing previous securities with a 3.1% rate. This move is part of CLAS’s strategy to maintain stable capital management and support ongoing AEIs.

Looking ahead, CLAS aims to deliver stable distributions, with a focus on maintaining DPU stability in comparison to FY24’s 6.1 Singapore cents. The trust’s strategic initiatives are expected to enhance core income and support higher DPU in the coming years.
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Starhill Global Real Estate Investment Trust (SGREIT) has reported a 1.2% rise in revenue for the financial year 2025, reaching SGD192.1 million, alongside a 0.8% increase in net property income (NPI) to SGD150.2 million. The trust’s performance was buoyed by strong rental reversions in Singapore, despite challenges in overseas markets, according to a DBS Research report.

SGREIT’s portfolio remains nearly fully occupied, with significant contributions from its Singapore assets. The Wisma Atria mall, located on Orchard Road, is set to benefit from recent asset enhancement initiatives, including upgrades to its taxi drop-off point and interior atrium. These improvements are expected to capture increased tourism traffic and bolster rental income.

The trust’s financial stability is further supported by its conservative leverage ratio of 36% and a high proportion of master and anchor leases, which shield it from rising operating costs. Approximately 53% of SGREIT’s gross rents for the quarter were derived from these leases.

Despite a 5.2% year-on-year decline in tenant sales at Wisma Atria, attributed to a high base effect and slow recovery in luxury spending, SGREIT remains optimistic. The trust has secured a new tenant for its Myer Centre Adelaide Office, replacing a key tenant that exited, ensuring continued occupancy.

Looking ahead, SGREIT plans to rechannel gains from recent divestments to fund further asset enhancements or distribute special dividends to unitholders. The trust’s distribution per unit (DPU) for FY25 increased by 0.6% to 3.65 Singapore cents, aligning with market expectations.

SGREIT’s focus on Singapore-centric assets and strategic enhancements positions it well for future growth, with analysts maintaining a “BUY” recommendation and a target price of SGD0.68.
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Frasers Centrepoint Trust (FCT), a major owner of suburban retail malls in Singapore, reported an impressive 99.9% occupancy rate for its portfolio in the third quarter of FY25, excluding Hougang Mall, which is undergoing asset enhancement initiatives (AEI). The trust, which owns 10 suburban malls and one office building, is also planning a holistic AEI for Northpoint City, following the acquisition of additional levels in Yishun 10 by its sponsor, Frasers Property, according to a UOBKayHian report.

FCT’s suburban malls have benefited from the disbursement of Community Development Council (CDC) vouchers, which contributed to a 4.4% year-on-year increase in tenant sales. The trust has also introduced 59 new-to-portfolio tenancies this year, further enhancing its retail offerings. The completion of AEI at Tampines 1 and the introduction of new tenants have driven growth in shopper traffic by 2.1% year-on-year.

The trust’s financial health remains robust, with a manageable aggregate leverage of 40.4% as of June 2025, and an average cost of debt reduced to 3.7% in Q3 FY25. The acquisition of Northpoint City South Wing (NCSW) for $1,133m (S$1,133m) is expected to expand FCT’s portfolio valuation by 21% to $6.4b (S$6.4b), increasing its market share of suburban malls to 10.3%.

FCT’s strategic focus on dominant suburban malls is evident in its plans for Northpoint City, where it aims to unlock value through AEI by optimising tenant mix and enhancing retail space. The trust maintains a positive outlook, with expectations of continued positive rental reversions and a distribution yield of 5.8% for FY26.
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Keppel DC REIT, Asia’s first pure-play data centre real estate investment trust, has reported a significant 51% positive rental reversion for the first half of 2025. This growth was largely attributed to the renewal of colocation leases, particularly from SGP4, which contributed 11% to the rental income. The trust’s recent acquisitions, SGP7 and SGP8, also played a crucial role, accounting for about a quarter of the total net property income (NPI), according to a UOBKayHian report.

The REIT’s gross revenue surged by 34.4% to $154.5 million (S$211.3 million), whilst NPI increased by 37.8% to $133.8 million (S$182.8 million), bolstered by contributions from the newly acquired Tokyo Data Centre 1. Despite divestments in Sydney and Germany, the REIT maintained a robust performance, with a distributable income rise of 57.2% to $92.9 million (S$127.1 million).

Keppel DC REIT’s strategic focus on hyperscale data centres is evident as it seeks opportunities in Japan, South Korea, and Europe. The REIT aims to develop long-term relationships with hyperscale tenants, targeting data centres with a power capacity of 20-50MW. The tight vacancy in Singapore is expected to sustain positive rental reversion into 2026.

The REIT’s portfolio occupancy slightly dipped to 95.8% due to a vacancy at SGP1, but plans are underway to enhance its capabilities, including potential AI enhancements. Keppel DC REIT’s inclusion in the Straits Times Index from 23 June 2025 underscores its growing prominence in the market. The management maintains a “BUY” recommendation with a target price of $1.91 (S$2.69), citing stable debt costs and strategic growth initiatives.
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Singapore’s labour market showed resilience in the second quarter of 2025, with total employment rising by 8,400, according to advance estimates from the Ministry of Manpower. This growth, however, marks a slowdown compared to the 11,300 increase seen in the same period last year. The rise in employment was driven by gains among both residents and non-residents, although outward-oriented sectors like Professional Services and Information & Communications continued to face challenges.

The report highlights that resident employment saw notable increases in Financial Services and Health & Social Services. Conversely, sectors such as Retail Trade experienced declines as employers adjusted post-seasonal hiring from the previous quarter. Non-resident employment growth was primarily supported by Work Permit Holders in the Construction sector.

Unemployment rates for residents and citizens rose slightly in June 2025, reaching 2.9% and 3.0% respectively, returning to levels observed in March. Despite this uptick, the rates remain within the non-recessionary range. Retrenchments remained stable at 3,500, with business reorganisation cited as the primary reason.

Looking ahead, the Ministry of Manpower anticipates that employment will continue to grow, albeit at a more moderate pace than in 2024. The global economic uncertainty is expected to impact hiring and wage growth, particularly in outward-oriented sectors. The Labour Market Report for Q2 2025, due in mid-September, will provide further details on employment trends and sectoral data.
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Mapletree Industrial Trust (MINT) has announced its first quarter results for the financial year ending March 2026, revealing a slight dip in occupancy to 91.4%, whilst achieving a strong rental reversion of 8.2%. The trust reported a 0.3% year-on-year increase in revenue to S$175.9 million, driven by higher contributions from its Osaka data centre and positive lease renewals, although this was partially offset by lower contributions from its US data centre portfolio, according to a CGS International report.

Despite the occupancy decline, MINT’s distribution per unit (DPU) for the quarter was 3.27 Singapore cents, a 4.7% decrease from the previous year, primarily due to lower joint venture contributions and the absence of divestment gains. However, excluding these divestment gains, the DPU would have only slipped by 1.5% year-on-year.

The trust’s management has indicated that gearing could reduce to 37% following the completion of the sale of three Singapore properties by the third quarter of 2025. This sale is expected to generate S$535.5 million. MINT’s strategy includes tenant retention and exploring divestment opportunities, particularly within its US data centre portfolio.

Analysts have adjusted their forecasts, reducing the FY26-28 distribution per unit estimates by up to 2.78% due to the anticipated income vacuum from asset sales. Despite this, MINT maintains an “Add” rating, with a revised target price of S$2.49, citing its resilient portfolio metrics and an attractive projected dividend yield of 6.3% for FY26. Potential catalysts for a re-rating include better-than-expected rental reversions, whilst risks involve non-renewals at data centre lease expiries and a global economic slowdown.
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iFAST Corporation Ltd is set to experience accelerated profit growth in the second half of 2025, driven by its expanding Hong Kong business. The company’s net revenue for the second quarter of 2025 reached S$80.0 million, marking a 30.4% year-on-year increase, as the onboarding of trustees for Hong Kong’s e-Mandatory Pension Fund (eMPF) project progresses. This growth is expected to continue, with iFAST forecasting increased profitability in the upcoming quarters, according to a CGS International report.

The Hong Kong segment’s contribution to iFAST’s overall performance has been significant, with net revenue from this region growing by 40.1% year-on-year in the second quarter. Despite lowering its full-year pre-tax profit guidance for Hong Kong from HK$500 million to HK$380 million, iFAST remains optimistic about exceeding these targets as revenue recognition accelerates in the latter half of the year.

iFAST’s core business has also shown resilience, with assets under administration rising by 5.9% quarter-on-quarter to S$27.2 billion. This growth is supported by increased unit trust subscriptions and a substantial rise in customer deposits for its UK banking operations.

The company has raised its earnings per share estimates for 2025 to 2027 by up to 4.1%, reflecting improved revenue contributions from Hong Kong. Consequently, iFAST’s target price has been lifted to S$9.20, supported by a projected 27.8% compound annual growth rate in earnings per share from 2024 to 2027.

Looking ahead, iFAST aims to leverage its growing Hong Kong operations and UK banking contributions to sustain its upward trajectory. However, potential risks include missing revenue guidance for Hong Kong and stagnant assets under administration, which could impact its wealth management business.
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Raffles Medical Group (RMG) has announced a 4.8% year-on-year increase in its net profit after tax and minority interests (PATMI) for the first half of 2025, reaching S$32.1 million. This growth aligns with the company’s and Bloomberg’s consensus forecasts, despite challenges in its insurance services segment. The group’s revenue in China remained flat on a constant currency basis, but fell by 1.9% year-on-year due to foreign exchange effects, according to a CGS International report.

The insurance services segment reported a pre-tax loss of S$3.1 million, attributed to expected losses from new insurance contracts. However, RMG anticipates a potential write-back of these losses in the second half of 2025 if they do not materialise. The group’s healthcare services saw a decline in pre-tax profit margin, impacting overall profitability.

RMG is actively expanding its presence in China through strategic collaborations. In April, RafflesHospital Shanghai partnered with Shanghai Jiao Tong University School of Medicine to enhance resource sharing and elevate private healthcare standards. A similar partnership was established between RafflesHospital Chongqing and the First Affiliated Hospital of Chongqing Municipality. These collaborations aim to improve RMG’s reputation and bed utilisation in China.

Looking ahead, CGS International maintains its forecast for continued profit growth in the second half of 2025, supported by its strategic initiatives in China and potential re-rating catalysts, including the acquisition of American International Hospital in Vietnam. The company reiterates its target price of S$1.20, reflecting an 11.7% upside from the current price.
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