Published March 17, 2012
Boston Consulting Group identifies the three as among 11 S'pore companies which are South-east Asian 'challengers'
By JASMINE NG
SINGAPORE-BASED CapitaLand, Fraser and Neave, and Olam are among the new South-east Asian 'challengers' set to shine on the international stage, according to the Boston Consulting Group (BCG).
The consultancy identified these 'challengers' as fast-growing, expanding twice as fast as their global peers in similar industries, and having generated far greater shareholder returns than global peers or indices of emerging market or South-east Asian stocks.
These companies are part of a total of 50 'challengers' identified in the region. They range from US$500 million to US$63 billion in size, are growing and profitable, and boast strong international ambitions.
Singapore has 11 companies on the list, including Changi Airport Group and PSA. Other fast-growing 'challengers' from Singapore are Hyflux, Keppel, Sembcorp, ST Engineering, Wilmar International and Petra Foods.
In terms of their global growth, they are no longer caterpillars but not yet butterflies, BCG said in a report titled, 'The Companies Piloting a Soaring Region'. Hence, companies that have been leaders in their respective industries for years - such as Singapore Airlines and Malaysian energy firm Petronas - can no longer be considered challengers. 'They are already champions from the region,' BCG said.
Other companies on the list include AirAsia and CIMB from Malaysia; Bayan Resources and Golden Agri-Resources from Indonesia; Siam Cement Group and Central Group from Thailand; Jollibee from the Philippines; and Vinamilk from Vietnam.
These companies are expanding twice as fast as their global counterparts - which consist of multinationals in similar industries - and are more profitable.
A US$100 investment in a basket of South-east Asian challengers at the start of 2000 would have been worth about US$590 by the end of last year, BCG noted.
Rising consumer spending, better regulation and bolder ambitions were cited as these firms' main drivers of growth.
Singapore-based cocoa supplier Petra Foods, for example, is riding on the back of a rise in middle-class consumers in emerging markets, many of whom view chocolate as an affordable luxury. It has a 50 per cent market share in Indonesia, where the market is expected to grow by 18 per cent annually through 2015.
Two Malaysian financial firms, Maybank and CIMB, are adopting the strategy of a 'regional rollout' by leveraging on local consumer insight and developing customised business models.
BCG said South-east Asia is fast becoming an economically integrated region, with Singapore as the hub of financial and logistics activity and an example to other nations of what they might also achieve.
Looking ahead, BCG predicted Banyan Tree Hotels and Resorts, BreadTalk and Charles & Keith - all of which are based in Singapore - as next to make the list. - BT
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