SPH to be removed from Straits Times Index, replaced by Mapletree Industrial Trust
SINGAPORE — Media company Singapore Press Holdings (SPH) will be removed as one of the constituents of the Straits Times Index — the benchmark index for the Singapore stock market. It will be replaced by Mapletree Industrial Trust, one of several real estate investment trusts (Reits) under the Mapletree real estate conglomerate.
SINGAPORE — Media company Singapore Press Holdings (SPH) will be removed as one of the constituents of the Straits Times Index (STI) — the benchmark index for the Singapore stock market. It will be replaced by Mapletree Industrial Trust, one of several real estate investment trusts (Reits) under the Mapletree real estate conglomerate.
Announcing the change in a filing to the Singapore Exchange (SGX) on Thursday (June 4) after market closed, the STI’s administrator FTSE Russell said the change, made after the quarterly review in June, will take effect from the start of trading on June 22.
The STI is made up of the top 30 stocks listed on SGX’s mainboard, ranked by market capitalisation.
Market capitalisation refers to the value of a publicly listed company based on how its outstanding shares are traded on the open market.
At the end of trading on Thursday, SPH’s market capitalisation was S$2.18 billion, while Mapletree Industrial Trust was worth S$5.83 billion.
The top 30 aside, there is a so-called “reserve list” comprising the five highest ranking companies outside of the index by market capitalisation.
When the constituents of the STI are reviewed every quarter, a company in the reserve list may replace an existing company in the STI.
This may happen for one of these reasons: When eligible securities on the mainboard are ranked by market capitalisation, either the value of the STI constituent drops below the 40th position or a counter in the reserve list rises to the 20th position or above.
This is according to ground rules of the STI, which is created by SPH and managed by FTSE Russell.
The STI is jointly calculated by FTSE Russell, SPH — the publisher of the Straits Times newspaper — and SGX.
The FTSE ST methodology ensures the indexes accurately represent the investable universe for benchmarking purposes and can be easily replicated as the basis of index-linked products, FTSE said in a statement.
With the Mapletree Industrial Trust soon to be an STI constituent, the five companies making up the reserve list for the next review in September, in order of market capitalisation, are: Keppel DC Reit, Suntec Reit, NetLink NBN Trust, Frasers Logistics and Industrial Trust and Keppel Reit.
On Thursday, SPH’s share price closed 0.74 per cent higher, ending at S$1.37, while the stock price of Mapletree Industrial Trust declined by 1.49 per cent, closing at S$2.65.
SPH’s share price has been steadily going down, dropping over 37 per cent since the start of the year.
On Monday, Bloomberg reported that the counter, along with Sembcorp Industries, ComfortDelGro and Sats, saw huge declines after they were removed from the MSCI Singapore Index.
The MSCI Singapore Index measures the performance of the large and mid-sized publicly listed companies in Singapore.