Investing Updates: Not many STI listcos provide substantial forward-looking guidance: study

Source:

https://www.businesstimes.com.sg/companies-markets/not-many-sti-listcos-provide-substantial-forward-looking-guidance-study

ChatGPT:

A new study by Black Sun Global and the Securities Investors Association (Singapore) (SIAS) found that many of Singapore's largest listed companies provide comprehensive reports on historical performance but fall short in communicating their future plans and long-term strategy. Among the 30 companies in the Straits Times Index (STI), only 13% provide structured medium-term financial guidance, compared with 59% of companies in the UK's FTSE 100. This lack of forward-looking guidance makes it harder for investors to assess whether corporate strategies are likely to translate into future financial results.

The findings come as Singapore seeks to revitalise its stock market through initiatives such as the S$6.5 billion Equity Market Development Programme and the S$30 million Value Unlock programme, aimed at improving market liquidity, valuations and investor engagement.

The report notes that companies often hesitate to provide forecasts because of uncertainties including geopolitical tensions, economic volatility, labour shortages and rapid technological change. Instead of focusing solely on whether companies meet forecasts, investors increasingly value transparency around the assumptions behind guidance and honest explanations when targets are missed.

Several companies were highlighted as examples of good disclosure practices. Genting Singapore explained that weaker earnings resulted from renovation works and new operational investments. ST Engineering openly discussed defence contract delays and cost overruns, while DBS detailed the causes of its major digital banking outage and the measures implemented to strengthen system resilience.

The study also found that while 87% of institutional investors consider SGX disclosures useful, only 18% rate them as highly transparent. Furthermore, 57% of STI companies fail to clearly articulate their competitive advantages and long-term investment case, limiting investor confidence despite generally strong business fundamentals.

---

Social media and forum discussions

HardwareZone

The report generated active discussion among Singapore investors. Common opinions include:

• Investors agree that many SGX-listed companies issue earnings updates but rarely explain long-term growth plans.

• Some users argue that Singapore companies are intentionally conservative to avoid legal and reputational risks if forecasts are missed.

• Others believe stronger forward guidance could attract more institutional and foreign investors to SGX.

Overall sentiment: Constructively positive, with calls for better investor relations rather than mandatory earnings forecasts.

Reddit

Discussions in communities such as r/SingaporeFI, r/singapore, and investing-related threads focus on:

• Why SGX companies trade at lower valuations than regional peers.

• Whether conservative disclosure contributes to Singapore's valuation discount.

• Comparisons with US companies that provide quarterly guidance and earnings outlooks.

• Mixed opinions on whether forward guidance actually benefits long-term investors.

Many users note that transparency and capital allocation matter more than simply publishing optimistic forecasts.

X (formerly Twitter)

Finance professionals and market commentators shared highlights from the report, noting:

• The 13% vs 59% comparison with the FTSE 100.

• Singapore's need to improve corporate communication to support market reforms.

• Positive reactions to the Value Unlock initiative.

Facebook

Investment groups discussed:

• Whether companies should provide more detailed strategic roadmaps.

• The importance of explaining capital expenditure, acquisitions and dividend policies.

Instagram

Financial educators created infographic posts summarising:

• The low percentage of STI companies offering forward guidance.

• Why transparency can improve investor confidence and valuation multiples.

TikTok

Singapore finance creators explained the report in short videos, generally agreeing that better communication—not just better earnings—can help companies attract investors.

Threads

Threads discussions echoed LinkedIn and X, with professionals debating whether SGX should encourage voluntary best practices rather than mandatory guidance.

Overall public sentiment

Overall sentiment is moderately positive and supportive of greater transparency. Investors generally understand why companies are cautious about issuing forecasts in an uncertain environment, but many believe STI-listed firms should communicate strategy, capital allocation, risks and long-term objectives more clearly. The consensus is that stronger investor communication could improve market confidence, narrow Singapore's valuation discount, and make SGX-listed companies more attractive to both local and international investors.