SINGAPORE: Interest rates are expected to “stay high” in 2024, creating an environment where investors seek stability.
For investors looking for “peace of mind”, The Smart Investor suggests considering these four Singapore stocks in 2024 with either “low debt or zero debt.”
1. HRNetGroup Ltd (SGX: CHZ)
HRNetGroup, a recruitment and staffing firm operating across 15 Asian cities, faced challenges in the first half of 2023. The company maintained a robust balance sheet despite a 6.2% dip in revenue to S$294.8 million and a 22.8% decrease in net profit to S$35.3 million.
As of Jun 30, 2023, HRNetGroup held S$261.8 million in cash and boasted zero debt. The company’s recent expansion into Hsinchu, Taiwan, signals a positive outlook as the economy gradually recovers.
2. Haw Par Corporation Limited (SGX: H02)
Haw Par, a conglomerate with healthcare, leisure, property, and investments divisions, witnessed a sharp recovery in the first half of 2023. Haw Par’s financial health is evident, with a 16.3% year-on-year increase in revenue to S$111.1 million and a nearly 35% rise in net profit to S$104.1 million.
The company maintains a strong balance sheet with S$276.3 million in cash and S$414.2 million in investments in debt securities, coupled with minimal borrowings of S$28 million. Increased interim dividends from S$0.15 to S$0.20 demonstrate Haw Par’s resilience.
3. VICOM Limited (SGX: WJP)
VICOM, a provider of inspection and technical testing services under ComfortDelGro Corporation Ltd, reported a 3% year-on-year increase in revenue for the first nine months of 2023 to S$83.1 million. Net profit also rose by 5% to S$20.5 million.
With a clean balance sheet showing S$46.9 million in cash and no debt as of Sept 30, 2023, VICOM remains financially stable. Despite investing S$6.1 million in a new headquarters, the company generated a positive free cash flow of S$10.5 million for the same period.
4. Sheng Siong Group Ltd (SGX: OV8)
Sheng Siong, a prominent supermarket operator with 69 outlets in Singapore, reported resilient earnings for the first nine months of 2023. While revenue inched up by 2.6% to S$1 billion, operating profit dipped by 4.2% to S$115.5 million.
Notably, net profit remained flat at S$100.3 million, and the company holds a clean balance sheet with S$289.2 million in cash and zero debt as of Sept 30, 2023.
Sheng Siong’s positive free cash flow of S$125.1 million for 9M 2023 underscores its financial strength. The company plans to expand its store count, having already secured one HDB shop space and with more tenders on the horizon./TISG