On Wednesday, March 5, 2025, the Singapore Exchange $SGX(S68.SI)$ announced the expansion of its Special Drawing Rights (SDR)-related financial product suite, with the inclusion of $MEITUAN-W(03690)$ , $XIAOMI-W(01810)$ , and $Ping An Insurance (Group) Company of China Ltd.(PNGAY)$ . This move marks a significant development in SGX's international financial market presence and offers local investors a more diversified range of investment options.
PHOTOS: BLOOMBERG, REUTERS
As of March 2025, the Singapore Exchange (SGX) has expanded its list of Singapore Depository Receipts (SDR) to include several notable companies. The current SDR offerings on SGX can be categorized into Hong Kong and Thailand-based SDRs:
Hong Kong SDRs
$Alibaba HK SDR 5to1(HBBD.SI)$ – China's largest e-commerce platform.
$Tencent HK SDR 10to1(HTCD.SI)$ – A diversified conglomerate with businesses in social media and gaming.
$BYD HK SDR 10to1(HYDD.SI)$ – A leading electric vehicle manufacturer.
$HSBC HK SDR 5to1(HSHD.SI)$ – One of the largest banks by assets, offering a wide range of financial services.
$Bank of CN HK SDR 1to1(HBND.SI)$ – A state-owned commercial bank with significant operations in China.
Meituan HK SDR – A leading Chinese e-commerce platform for food delivery and lifestyle services.
Xiaomi HK SDR – A global technology company known for its smartphones and smart devices.
Ping An Insurance HK SDR – One of China's largest insurance companies.
NOTE: Data as at Feb 14. Source: SGX GROUP
Thailand SDRs
$Airports of Thailand NVDR(TATD.SI)$ – Operator of major airports in Thailand.
$CP All NVDR(TCPD.SI)$ – A leading retail company in Thailand.
$t PTTEP TH SDR(TPED.SI)$ – An energy company focused on oil and gas exploration.
$AIS TH SDR 10to1(TADD.SI)$ – A major telecommunications provider in Thailand.
$Delta TH SDR 1to1(TDED.SI)$ – A company providing electronic components and EV charging solutions.
$Gulf TH SDR 1to1(TGED.SI)$ – An energy developer with a focus on renewable energy.
$Kasikorn BK TH SDR1to1(TKKD.SI)$ – One of Thailand's largest banks.
$SiamCement TH SDR10to1(TSCD.SI)$ – A conglomerate with businesses in cement, packaging, and chemicals.
These SDRs provide Singaporean investors with convenient access to foreign securities without the need to trade directly on overseas exchanges. They also offer the benefits of lower investment amounts, local trading hours, and dividend payouts in Singapore dollars.
1. What is Special Drawing Rights (SDR)?
Special Drawing Rights (SDR) is an international reserve asset created by the International Monetary Fund (IMF) to supplement the foreign exchange reserves of countries and help address international balance-of-payments issues. SDR is not a currency itself but a unit of account, with its value based on a basket of major currencies, including the US dollar, euro, Chinese yuan, Japanese yen, and British pound.
2. The Meaning and Impact of the SDR Suite
The SDR suite typically refers to financial products denominated in or related to SDR, such as bonds, ETFs, or other derivatives. The inclusion of Meituan, Xiaomi, and Ping An Insurance means that SGX will introduce more SDR-denominated financial products related to these companies for investors to choose from.
For Meituan and Xiaomi, being included in the SDR suite signifies that their market positions and financial performance have been recognized by the international financial market. This will further enhance their visibility and attractiveness to international investors, potentially allowing them to access more international capital, reduce financing costs, and optimize their capital structure.
3. Significance for Investors
With the expansion of the SDR suite, investors will have a richer range of investment options, allowing them to indirectly invest in these representative Chinese tech companies through SDR-related products. Additionally, SDR trading offers the following advantages:
Convenience: Investors do not need to exchange into Hong Kong dollars; they can trade directly in Singapore dollars.
Arbitrage Opportunities: Different markets may have price discrepancies, providing opportunities for investors to exploit these price differences.
Short-term Investment Opportunities: Investors can more flexibly participate in short-term investments in hot or high-quality stocks.
4. Comparison of SDR with Hong Kong Stocks and SGX Mainboard Stocks
While SDR offers new investment channels, it also has unique characteristics compared to directly purchasing Hong Kong stocks or SGX mainboard stocks. For example, the liquidity of SDR-listed stocks may be lower than that of foreign stocks listed on the Hong Kong or SGX mainboard. Additionally, SDR trading prices may not always track the prices of the underlying securities in overseas markets, potentially resulting in premiums or discounts.
5. A brief analysis of the current investment value of these three companies:
Stock Performance: Since the beginning of 2025, Xiaomi's stock price has risen by over 24%, reaching a new historical high on February 26, with a total market value exceeding HKD 1.4 trillion.
Long-term Investment Value: Xiaomi's business transformation and technological innovation have laid the foundation for its future growth. The company's strategic positioning in electric vehicles, AIoT, and global expansion has established it as a key player in the tech ecosystem.
Risk Alert: Attention should be paid to factors such as global economic fluctuations, intensified market competition, and market saturation in the smartphone sector.
Technical Analysis and Strategy: Meituan has a solid market position in the field of lifestyle services but faces uncertainties from market competition and regulatory policies. Short-term investors can capture rebound opportunities through right-side trading strategies, while long-term investors can position themselves during periods of low valuation.
Long-term Investment Value: Meituan's diversified business and high user activity give it long-term growth potential. With improvements in the policy environment and the expansion of new businesses, its stock price is expected to rise further.
Risk Alert: Factors such as intensified market competition, regulatory uncertainty, and underperformance of new business development may affect its stock price performance.
$Ping An Insurance (Group) Company of China Ltd.(PIAIF)$
Finance and Strategy: As one of China's three major comprehensive financial groups, Ping An has a stable financial condition. Its strategic positioning in fintech and insurance has established it as a key player in the market.
Long-term Investment Value: Ping An enhances its profit stability by investing in high-dividend assets (such as banks) and is expected to further improve its performance through the recovery of government bond interest rates in the future.
Risk Alert: Uncertainties in the macroeconomic environment and changes in regulatory policies may impact its stock price.
Summary:
Xiaomi: The stock price has risen significantly, but long-term investment value remains, making it suitable for medium- to long-term investors.
Meituan: The market position is solid, but attention should be paid to short-term fluctuations and long-term growth potential. It is suitable for a strategy that combines short-term trading and long-term holding.
Ping An Insurance: With a stable financial condition, it is suitable for long-term investors to position themselves, but attention should be paid to the macroeconomic environment and policy environment.
6. Conclusion
SGX's expansion of its SDR-related financial product suite and the inclusion of Meituan, Xiaomi, and Ping An Insurance provide Singaporean investors with a more diversified range of investment options. Investors can indirectly invest in these well-known companies through SDR, while enjoying the convenience of trading and potential arbitrage opportunities. However, investors should also be mindful of the liquidity risks and price volatility associated with SDR trading.
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