The measures proposed at the Singapore Budget 2024, which tackle issues such as the higher cost of living and business costs, as well as closing the wage gap, is a fairly expected one, say CGS International analysts Lock Mun Yee and Lim Siew Khee.
To partly defray the higher cost of living, deputy prime minister (DPM) Lawrence Wong said that Singaporean households will receive $600 in Community Development Council (CDC) vouchers. A cost-of-living special payment of between $200 to $400 will be given to adult Singaporeans with assessable income of up to $100,000. These same adults must also not own more than one property.
In a bid to close wage gaps, Wong announced several initiatives including raising the local qualifying salary to $1,600 from $1,400. The minimum hourly wage was also increased to $10.50 from $9.
To Lock and Lim, the higher cash handouts are expected to benefit supermarket operators such as Sheng Siong and DFI Retail as well as coffee shop food retailers like Kimly 1D0 . At the same time, the higher minimum wage could slightly impact labour-intensive sectors negatively including food and beverage (F&B) players like Jumbo and Kimly, the supermarket operators as well as Singapore Post S08 (SingPost).
Sembcorp and Keppel to benefit from new energy fund
The establishment of a $5 billion new energy fund in a bid to support the clean energy push will also give better clarity on Singapore’s investment in renewable energy infrastructure and import transmission.
See also: What may be included in Singapore's unemployment benefits for retrenched workers?
The new energy fund, which is positive for renewable energy imports, will also impact counters such as Sembcorp Industries U96 , Keppel and KLSE-listed YTL Power positively albeit indirectly.
“Sembcorp has received conditional approval to import 1.2GW of offshore wind from Vietnam and is in exclusive discussions to import 1GW of hydropower from Sarawak. Keppel also received approval to import 1GW of renewable energy including solar, hydropower and potentially wind by 2035,” say Lock and Lim.
“All of these would require investments in subsea cables, transmission networks and relevant storage. At the same time, Keppel, Sembcorp and YTL Power are respectively constructing 600MW hydrogen-ready power plants by 2026/2027 which would require support from hydrogen infrastructure,” they add.
See also: Singaporeans say budget fails to ease living costs: survey
CDL, UOL to benefit from ABSD, tax changes
Finally, maintaining a stable property market seems to be on Wong’s agenda, who announced changes to the additional buyers’ stamp duty (ABSD) and property taxes, including lower ABSD remission clawback rates for developers if they sell 90% of individual projects’ units within five years from the date of the land acquisition.
This is expected to impact developers such as City Developments Limited C09 (CDL) and UOL positively as it provides flexibility to developers to sell their balance units. This, according to the analysts, will lead to more stability in the property market.
