SINGAPORE: Temasek Holdings continues to impress in the investment landscape, with their net portfolio value reaching a staggering S$434 billion (US$339 billion) as of 31 March 2024. This marks an 11 per cent increase from the previous year, driven by the strong performance of Singapore-based companies and direct investments in key markets like China, the United States, and India.
Significant Sustainable Growth
The state investor’s sustainable living investment portfolio also saw a rise, increasing by S$2 billion (US$1.56 billion) over the last financial year. Temasek’s sustainability portfolio is valued at S$46 billion, comprising S$39 billion in sustainability-focused investments and S$7 billion in climate transition solutions. This impressive growth represents 11 per cent of Temasek’s net portfolio value.
- Renewable Energy: Investments in firms like France’s Neoen and Sweden’s Aira.
- Clean Technologies: Ventures into ammonia-to-power solutions with US-based Amogy.
- Climate Transition: Collaboration with UK-based Atlantica Sustainable Infrastructure.
Portfolio Emissions and Goals
According to Temasek, they have reduced net carbon emissions attributable to their portfolio by approximately 4.55 per cent since 2010. The firm aims to halve its emissions to 11 million tonnes of carbon dioxide equivalent (MtCO2e) by 2030, eventually reaching net zero emissions by 2050. Major contributors to emissions, such as Singapore Airlines (SIA), still represent a significant challenge in reaching these targets.
Investment Strategy Amid Global Concerns
As Temasek navigates increasing geopolitical tensions and the climate crisis, its chief executive officer, Dilhan Pillay, emphasised the need for a pragmatic approach in their investment strategy. They’ve been actively rebalancing their portfolio, investing S$52 billion while divesting S$42 billion in the last financial year.
Key takeaways from Temasek’s strategy include:
- A focus on emerging and established market leaders, particularly those with resilient supply chains.
- An emphasis on sectors such as digital infrastructure, artificial intelligence, and energy transition assets.
- Continued commitment to exploring new technologies, including advancements in AI.
The Road Ahead
Looking ahead, Temasek sees ample opportunities in various sectors. Their increased investment exposure in the United States, now at 24 per cent, highlights its status as a vital investment market despite some geopolitical risks.
With a clear-eyed view of future challenges, Temasek is positioned to navigate the complexities of the global investment landscape while making strides towards sustainable growth.