Daily Debrief: What Happened Today (Jun 9)
Stories you might have missed
Will deglobalisation and business uncertainty hurt buying power in Good Class Bungalow properties?
[SINGAPORE] Owning a detached home in a Good Class Bungalow (GCB) Area is arguably the ultimate status symbol for the super rich in land-scarce Singapore.
CapitaLand Investment expands fund with Japan asset acquisition at 30 billion yen
[SINGAPORE] CapitaLand Investment (CLI) on Monday (Jun 9) announced that it secured additional capital commitments from new and existing institutional investors for its value-add lodging private fund, CapitaLand Ascott Residence Asia Fund II (Clara II).
CDL's high debt and interest costs continue to weigh on stock despite South Beach sale
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[SINGAPORE] News of City Developments Ltd's (CDL) sale of its 50.1 per cent majority stake in the South Beach mixed project put some bounce in the property developer's share price last week, but analysts were less sanguine, due to the company's high debt and interest costs.
Income Insurance chairman Ronald Ong to retire from role after seven years at helm
[SINGAPORE] Income Insurance chairman Ronald Ong, 69, will retire from his role after seven years at the helm, the company announced on Monday (Jun 9).
MoneyHero expands into digital assets in partnership with OSL
[SINGAPORE] MoneyHero, a leading personal finance aggregation and comparison platform across Greater South-east Asia on Monday (Jun 9) announced a strategic collaboration with digital asset platform OSL Group.
Singapore stocks close Monday higher ahead of US-China talks; STI up 0.1%
[SINGAPORE] Local stocks rose on Monday (Jun 9), in line with gains in Asian markets on hopes that a fresh round of US-China trade talks will ease tensions. Investors also digested the latest China inflation and trade data.
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US-China rivalry poses challenges for deepening China-Hong Kong links
China has increased efforts to connect Hong Kong more closely to the mainland, both economically and socially. But with the US-China rivalry deepening, being so close to China has posed challenges for the city. CNA's May Wong reports from Hong Kong.
Business Times
an hour ago
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Asia healthcare assets risk overvaluation as private investors scoop them up
[SINGAPORE] As private equity (PE) investors pour money into Asian healthcare, some observers are concerned that this sector could soon overheat. Some recent deals this year include KKR's US$400 million purchase of a 54 per cent stake in India's Healthcare Global Enterprises in February. In Singapore, another American PE firm TPG took Catalist-listed nursing operator Econ Healthcare private in a deal worth nearly S$88 million. When the proposed transaction was announced in February, the offer price represented a 20 per cent premium to Econ's last traded share price on Jan 14. 'We are not the only ones to see the opportunity of healthcare in Asia, and, as a consequence, valuations can be high,' Abrar Mir, co-founder and managing partner of healthcare-focused PE firm Quadria Capital, told The Business Times. Other factors driving investors to the healthcare sector – perceived as defensive, and so able to withstand the ups and downs of economic cycles – is the ongoing macroeconomic uncertainty and volatility in global financial markets. This is particularly so in Asia, where investors have been diversifying away from China in the last few years, to avoid being caught in the cross hairs of the nation's tensions with the United States. As PE firms and their investors focus on acquiring companies independent of China, more deals have been transacted in Japan, South Korea and India, where the demand for healthcare and related services is strong and largely unaffected by tariffs. 'Japan has always been a stable healthcare market, and particularly because of (its) demographics and medical needs,' said David Braga Malta, thematic health principal at Pictet Alternative Advisors, to BT. 'We saw some of the mid-sized Japanese pharma companies being very acquisitive in the recent months and years... And of course, we saw the boom in the IPO (initial public offering) markets in India last year.' BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Asia's appeal even drew European PE investors to buy South Korean assets for the first time in 2024, he added. Last September, France's Archimed spent US$742 million buying Jeisys Medical, a South Korean developer of aesthetic medicine devices. Like shopping in Louis Vuitton 'One of the key things that I always say to my investors is that... investing in healthcare in Asia is like shopping in Louis Vuitton. So, as an investor, we have to navigate that, be careful not to overpay,' said Quadria Capital's Mir. According to a Bain & Co report, global PE deal value in the sector surged last year to an estimated US$115 billion – the second highest on record. Bain added that PE firms continue to invest in healthcare in the Asia-Pacific, where deal values have been steadily rising since 2016. Industry participants named India as the country attracting the most number of healthcare PE investors. An ageing population, rising incidence of chronic disease and growing awareness of preventive care, combined with the opening up of its insurance market to foreign investment, are making India stand out. Bain estimated that the country made up 26 per cent of the 62 deals transacted in the Asia-Pacific last year. PwC said its health industries practice in India hit a double-digit compound annual growth rate in the past few years as well. But Ling Tok Hong, deals and private equity leader at PwC, cautioned that 'this continued focus on the India market could make it more susceptible to overvaluation if investors are not cautious'. South-east Asia's healthcare sector is also attracting PE investors, leading to 'unprecedented valuations' of Ebitda multiples in their 20s, noted Ling. He was referring to earnings before interest, taxes, depreciation and amortisation. Room for growth; returns still strong Despite the rising valuations in Asia's healthcare sector, market participants point out that there is still room for growth, a key factor backing the higher valuations in the first place. The sector offers attractive long-term growth prospects as the supply of quality healthcare assets in the region is not growing quickly enough to meet demand. In markets such as South-east Asia, 'the number of large, institutionally ready platforms is still limited. This scarcity has helped sustain high entry multiples in recent years', said Alex Boulton, partner and Asia-Pacific lead for healthcare and life sciences private equity at Bain. He pointed out that South-east Asia's healthcare sector relies heavily on private players. For instance, the private sector accounts for roughly half of all hospital beds in Indonesia and the Philippines. 'That structural dynamic creates an enduring role for private capital in expanding and upgrading healthcare infrastructure.' Market participants emphasise that Asian healthcare is not in bubble territory. Boulton pointed out that even with rising valuations, healthcare PE in Asia is still delivering strong returns. Bain's analysis shows that from 2018 to 2023, the median multiple on invested capital (MOIC) for exited healthcare deals in the region was approximately 2.6 – meaning that a US$1 million investment generated a return of US$2.6 million. This compares with the global median MOIC of around two. 'That speaks to the sector's ability to compound value through growth and operational improvement, even in a more expensive entry environment,' noted Boulton. That said, while returns are likely to remain strong in the future, the median MOIC may not be sustained at these levels, he added. Thus, market players said, investors will need to have a clear plan to create meaningful impact and value over the life of their investments.
CNA
2 hours ago
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Tariff war: US, Chinese officials meet in London to discuss trade disagreements
There are fresh hopes for a breakthrough as the US and China hold a second round of trade negotiations, this time in the UK. The London meeting between top-level trade officials comes just days after a phone call between Donald Trump and Xi Jinping. Olly Barratt and Tan Si Hui report.
