DBS Group Holdings | CapitaLand ICIT | Keppel Ltd
February 2026 | SGX Blue-Chip Coverage
SUMMARY RATINGS
Company Ticker Rating Theme Key Metric
DBS Group Holdings SGX: D05 ACCUMULATE Dividend / Quality ROE 16.2%
CapitaLand ICIT SGX: C38U BUY Income + Growth DPU +6.4%
Keppel Ltd SGX: BN4 BUY Transformation Core NPAT +39%
This report evaluates each company across four dimensions: Case Study, Outlook, Solutions, and Impact.
- Executive Summary
This report presents an institutional-grade investment analysis of three Singapore Exchange (SGX) blue-chip constituents: DBS Group Holdings, CapitaLand Integrated Commercial Trust (CICT), and Keppel Ltd. Drawing on full-year 2025 (FY2025) results, macroeconomic context, and forward-looking strategic guidance, each company is evaluated across four dimensions: Case Study, Outlook, Solutions, and Investment Impact.
Collectively, these three companies represent a cross-section of Singapore’s core economic pillars: banking and financial services, commercial real estate and retail infrastructure, and global asset management with a focus on digital and sustainable infrastructure. Their combined market capitalisation accounts for a material share of the Straits Times Index (STI), making them systemically important bellwethers for Singapore equities. - Macroeconomic & Market Context
Singapore enters 2026 in a position of relative stability, though the global environment remains complex. Key macroeconomic variables shaping investment decisions include the following.
Interest Rates
The US Federal Reserve commenced a rate-cutting cycle in late 2024, with further reductions expected through 2026. The MAS has maintained its exchange rate-centred policy framework. A declining rate environment benefits REITs and leveraged borrowers but compresses net interest margins (NIM) for banks, creating a divergence in sector performance.
Domestic Consumption
Singapore’s domestic retail and F&B sectors have demonstrated resilient demand, supported by strong employment, wage growth, and sustained inbound tourism. Retail mall footfall remains elevated, particularly in integrated commercial developments, underpinning REIT income stability.
Digital Infrastructure Demand
Data centre demand across Southeast Asia continues to accelerate, driven by cloud adoption, AI workloads, and enterprise digitalisation. Singapore, as the region’s leading data centre hub, benefits disproportionately, creating structural tailwinds for asset managers with infrastructure exposure.
Geopolitical Risk
Ongoing US-China trade tensions and supply chain reconfigurations present both risk and opportunity for Singapore-headquartered conglomerates with pan-Asian operations. Currency volatility, particularly in emerging market SGD pairs, warrants monitoring. - Company Case Studies
3.1 DBS Group Holdings (SGX: D05) – The Reliable Anchor
Company Overview
DBS Group Holdings is Southeast Asia’s largest bank by assets and a globally systemically important financial institution. Headquartered in Singapore, DBS operates across 19 markets with a primary focus on Greater China, South and Southeast Asia. Its business segments span Consumer Banking, Wealth Management, Institutional Banking, and Treasury Markets.
Case Study – FY2025 Performance
DBS reported record pre-tax profit of S$13.1 billion for FY2025, a landmark result demonstrating the bank’s capacity to generate superior returns even as the interest rate cycle enters a declining phase.
Metric FY2024 (est.) FY2025 Change
Pre-Tax Profit (S$ bn) 12.4 13.1 +5.6%
Return on Equity (ROE) ~18.0% 16.2% -1.8pp
Quarterly Capital Return Div S$0.15 S$0.15 Maintained
Final Ordinary Dividend S$0.60 S$0.66 +10%
Total Quarterly Payout S$0.74 S$0.81 +9.5%
The ROE compression from approximately 18% to 16.2% reflects early NIM contraction as rates decline, but the absolute level remains well above the sector average and signals superior capital efficiency. The increase in the ordinary dividend to S$0.66 demonstrates management confidence in sustainable earnings under a lower-rate regime. DBS has structurally evolved beyond a traditional lender: fee income from wealth management, treasury services, and digital banking now constitutes a growing share of total revenue, providing a buffer against interest income compression.
Strengths
Market leadership in Singapore, Hong Kong, and key ASEAN corridors
Diversified income across net interest income, fee income, trading, and wealth management
Strong capital adequacy ratios well above MAS requirements
Consistent dividend track record with a progressive payout policy
Best-in-class digital infrastructure reducing cost-to-income ratio
Weaknesses & Risks
NIM sensitivity: every 25bps rate cut compresses net interest income meaningfully
Credit cycle exposure in China and emerging market loan books
Concentration in Singapore and Hong Kong real estate lending
Outlook – FY2026
The central challenge for DBS in 2026 is defending earnings against a structurally lower NIM environment. Management has guided for NIM compression of approximately 10-15bps versus FY2025 levels. This is expected to be partially offset by loan volume growth in ASEAN institutional and SME segments, continued fee income expansion in wealth management, cost discipline through digital automation and AI-assisted operations, and deployment of excess capital via enhanced dividends or selective buybacks. Consensus estimates for FY2026 net profit are broadly in the S$11.5-12.0 billion range. At current market pricing, DBS offers a dividend yield of approximately 5.2-5.8%.
Solutions – Strategic Imperatives
Accelerate non-interest income by deepening the wealth management franchise, targeting ultra-high-net-worth clients and the growing pool of family offices relocating to Singapore.
Continue AI and cost optimisation investment to maintain cost-to-income ratios below 40%, leveraging DBS’s early-mover advantage in digital banking across ASEAN.
Implement prudent China exposure management through careful provisioning and selective deleveraging from real estate-linked exposures to reduce tail risk.
Deepen the Digibank model in India and Indonesia to provide a long-run growth runway compensating for Singapore market saturation.
Impact
For institutional investors, DBS remains a core SGX holding functioning as a hybrid: offering equity-like capital appreciation potential alongside near-bond-like dividend income. The stock provides income stability through its progressive dividend policy, defensive quality via a strong balance sheet, market beta correlated with the STI, and a valuation anchor at approximately 1.8-2.0x price-to-book. DBS’s earnings trajectory also serves as a leading indicator of Singapore’s credit conditions and corporate investment appetite.
3.2 CapitaLand Integrated Commercial Trust (SGX: C38U) – Singapore’s Physical Growth
Company Overview
CapitaLand Integrated Commercial Trust is Singapore’s largest REIT by market capitalisation, formed through the merger of CapitaLand Mall Trust and CapitaLand Commercial Trust in 2020. CICT owns and manages a diversified portfolio of retail malls, Grade A office buildings, and integrated developments across Singapore, Germany, and Australia.
Case Study – FY2025 Performance
CICT delivered a strong FY2025, with distribution per unit (DPU) growing 6.4% to S$0.1158, driven by organic rental growth, active portfolio management, and near-full occupancy across its properties.
Metric FY2024 (est.) FY2025 Change
Distribution Per Unit (DPU) S$0.1088 S$0.1158 +6.4%
Portfolio Occupancy Rate ~95.8% 96.9% +1.1pp
Retail Occupancy ~97.5% 98.7% +1.2pp
Rental Reversion Rate +4.2% +6.6% +2.4pp
The 98.7% retail occupancy signals that CICT’s mall assets – anchored by flagship destinations such as ION Orchard, Bugis Junction, Raffles City, and Plaza Singapura – are not merely surviving but thriving. The 6.6% positive rental reversion rate indicates CICT is renewing leases above the previous cycle, confirming genuine pricing power. The divestment of Bukit Panjang Plaza at a premium to book value exemplifies disciplined capital allocation: a prune-and-grow philosophy that is a hallmark of best-in-class REIT management.
Strengths
Singapore’s largest REIT with flagship locations in irreplaceable catchment areas
Integrated commercial model (retail and office) providing income diversification
Active asset recycling strategy generating NAV accretion
Sponsor backing from CapitaLand Investment providing pipeline visibility
Near-full occupancy and positive rental reversion confirming pricing power
Weaknesses & Risks
Interest rate sensitivity: higher borrowing costs compress distributions and re-rate yield instruments
Tenant concentration risk in F&B and fashion, which face structural pressures
Overseas exposure (Germany, Australia) introduces FX and regulatory risk
Outlook – FY2026
CICT enters 2026 with strong operational momentum. Key tailwinds include rate relief as global rates decline (reducing financing costs and supporting NAV recovery), continued Singapore tourism recovery, sustained CBD office demand from financial services and family office expansion, and asset enhancement initiatives providing DPU uplift without requiring new acquisitions. DPU growth in the 3-5% range for FY2026 appears achievable, with an indicative distribution yield of approximately 5.0-5.5%.
Solutions – Strategic Imperatives
Continue portfolio modernisation by divesting sub-scale assets and redeploying capital into next-generation retail and mixed-use formats catering to experience-driven consumption.
Leverage data analytics from shopper footfall and spending patterns to optimise tenant mix and maintain above-market rental reversion rates through economic cycles.
Accelerate BCA Green Mark certifications to attract ESG-mandated institutional investors and premium office tenants with sustainability commitments.
Pursue selective overseas diversification in Australia and Europe where yields are attractive post-repricing, reducing Singapore-concentration risk.
Impact
CICT functions as a barometer of domestic economic activity. High occupancy and rising rents signal business confidence, while declining metrics serve as an early warning of slowdown. For investors, CICT provides inflation-linked income through rents that adjust with market conditions, indirect exposure to Singapore’s retail consumption and office demand, and the compounding benefits of DPU reinvestment over multi-year horizons.
3.3 Keppel Ltd (SGX: BN4) – The Transformation Play
Company Overview
Keppel Ltd is a Singapore-headquartered conglomerate that has undergone a fundamental strategic repositioning over the past five years. Having divested its legacy offshore and marine business, Keppel has re-emerged as a global asset manager and operator focused on real estate, infrastructure, and connectivity – with particular emphasis on data centres, renewable energy, and sustainable urban development.
Case Study – FY2025 Performance
The New Keppel delivered its most compelling results yet in FY2025, validating the strategic pivot undertaken by its leadership team.
Metric FY2024 (est.) FY2025 Change
Net Profit – Core Operations (S$ bn) 0.79 1.10 +39.2%
Return on Equity (ROE) 14.9% 18.7% +3.8pp
Funds Under Management (S$ bn) ~84 95 +13.1%
FUM Target for 2026 (S$ bn) – 100 Goal
Total Dividend Per Share (S$) ~0.34 0.47 +38.2%
The 39% jump in core net profit reflects genuine operating leverage from the asset management model. Keppel now earns recurring management fees, performance fees, and co-investment returns from a S$95 billion FUM base – a fundamentally more capital-efficient and scalable earnings model than the capital-intensive shipbuilding business it left behind. The ROE improvement from 14.9% to 18.7% in a single year demonstrates that the asset-light transition is delivering on its financial promise, placing Keppel alongside the most efficient diversified financial services firms in Asia.
Strengths
Structural pivot to high-margin, recurring fee income from asset management
Data centre and digital infrastructure focus aligned with AI-driven demand
S$95 billion FUM approaching S$100 billion target with a clear 2026 milestone
Diversified fund structures across infrastructure, real estate, and private credit
Strong institutional investor relationships via the Keppel Capital platform
Weaknesses & Risks
Execution risk: scaling AUM beyond S$100 billion requires sustained fundraising in a competitive global alternative asset management landscape
Performance fee volatility: fee income is partly dependent on underlying asset performance, which fluctuates with macro conditions
Competition from Brookfield, GIC, Temasek, and global GPs targeting the same infrastructure and data centre assets
Outlook – FY2026
Keppel’s FY2026 thesis is straightforward: cross the S$100 billion FUM threshold, continue growing core profit, and extend the dividend growth trajectory. Key drivers include the data centre pipeline across APAC driven by AI infrastructure demand, new fund vehicles targeting infrastructure credit and private equity in Southeast Asia, performance fee crystallisation as earlier fund vintages mature, and continued legacy asset monetisation recycling capital at higher returns. FY2026 core profit growth in the 10-15% range appears credible, with dividend per share potentially reaching S$0.52-0.55.
Solutions – Strategic Imperatives
Double down on APAC data centre acquisitions and development, forming partnerships with hyperscalers such as Microsoft, Google, and AWS as anchor tenants to de-risk development and guarantee occupancy.
Launch private credit strategies targeting infrastructure debt in Southeast Asia, filling a market gap and providing investors with yield-generating alternatives as a capital-light AUM growth lever.
Package renewable energy and green infrastructure assets into dedicated ESG funds to attract sovereign wealth and pension capital with net-zero commitments.
Invest in world-class investment talent to compete with global alternative asset managers, as retaining senior portfolio managers underpins long-run AUM growth.
Impact
Keppel’s transformation is arguably the most consequential strategic story on the SGX in recent years. Its successful repositioning has re-rated the stock from a cyclical industrial to a growth-oriented asset manager, validated a broader trend of Singapore conglomerates shedding legacy capital-intensive businesses, and created a new model for APAC infrastructure investing. For investors, Keppel offers a rare combination: growth via AUM expansion, income via a rapidly growing dividend, and thematic relevance across data centres, infrastructure, and ESG.
- Comparative Outlook (2026) DBS Group CapitaLand ICIT Keppel Ltd
Sector Banking REIT Asset Management
FY2025 Key Metric PBT S$13.1bn DPU S$0.1158 Core NPAT S$1.1bn
Growth Rate +5.6% PBT +6.4% DPU +39% Core NPAT
Return on Equity 16.2% ~8% (REIT basis) 18.7%
Est. Dividend Yield 5.2-5.8% 5.0-5.5% 3.5-4.0%
FY2026 Outlook Cautiously Positive Constructive Bullish
Primary Risk NIM compression Rate sensitivity Fundraising pace
Investment Theme Income / Quality Income / Growth Growth / Transformation
Recommendation Accumulate Buy Buy
Rate Environment Sensitivity & Portfolio Construction
DBS has a negative correlation with rate cuts due to NIM compression, while CICT and Keppel both benefit from rate normalisation through lower cost of debt and supportive asset valuation dynamics respectively. This creates a natural diversification benefit: the three stocks together reduce interest rate directionality in a Singapore equity portfolio, smoothing performance across rate environments.
- Solutions & Strategic Implications
Cross-Cutting Theme 1: Digitalisation as Competitive Moat
All three companies are deploying technology to enhance efficiency and customer value. DBS leads in digital banking innovation; CICT is investing in data-driven mall management; Keppel’s data centre focus is itself a digital infrastructure play. Investors should assess digital capital expenditure not as a cost but as a long-run earnings multiplier that widens competitive moats and reduces operating cost ratios over time.
Cross-Cutting Theme 2: ESG as Alpha Generator
Institutional capital flows increasingly favour companies with credible ESG frameworks. DBS’s sustainable finance commitments, CICT’s green building certifications, and Keppel’s clean energy infrastructure all position these companies to access a growing pool of ESG-mandated capital at lower cost of funding, translating into tangible financing advantages and expanded investor universes.
Cross-Cutting Theme 3: Asset Recycling as Discipline
Both CICT and Keppel demonstrate the importance of active capital recycling: selling assets at peak values and reinvesting in higher-return opportunities. This discipline prevents value erosion and compounds NAV over time. DBS’s equivalent is its disciplined credit culture and selective loan book growth, prioritising return on risk-weighted assets over raw volume.
Cross-Cutting Theme 4: Dividend as Communication
All three companies are using progressive dividend policies as a signalling mechanism. Rising dividends communicate management confidence in earnings durability. For long-term investors, this is a more reliable indicator than quarterly earnings guidance and provides a compounding return floor over multi-year holding periods.
Investor Solutions by Profile
Investor Profile Recommended Approach
Conservative Income Investor Overweight DBS for dividend stability and balance sheet quality
Balanced Income and Growth Equal weight DBS and CICT for yield with moderate appreciation
Growth-Oriented Investor Overweight Keppel, with CICT as income floor
Total Return / STI Proxy Diversified equal weight across all three companies
- Investment Impact Assessment
Financial Impact – Illustrative Portfolio
The following illustrates the approximate annual income from a hypothetical S$30,000 portfolio equally split across all three companies. These are indicative estimates only and do not constitute a guarantee of returns.
Company Allocation Est. Yield Est. Annual Income
DBS Group Holdings S$10,000 ~5.5% ~S$550
CapitaLand ICIT S$10,000 ~5.2% ~S$520
Keppel Ltd S$10,000 ~3.8% ~S$380
Total Portfolio S$30,000 ~4.8% blended ~S$1,450
Combined 3-year total return potential in a moderate scenario is estimated at 25-40%, rising to 40-60% in a bull scenario driven by rate normalisation, earnings delivery, and STI re-rating. All estimates carry material uncertainty and are presented for illustrative purposes only.
Broader Economic Impact
DBS’s performance directly affects Singapore’s financial system stability. Its lending to SMEs, infrastructure projects, and trade finance facilitates real economic activity across ASEAN, making its health a proxy for regional business confidence.
CICT’s mall portfolio is a critical piece of Singapore’s urban fabric. Its tenants employ tens of thousands of workers across retail, F&B, and services. High occupancy supports employment and tax revenues, and the trust’s investment activity contributes to urban regeneration.
Keppel’s infrastructure and data centre investments contribute to Singapore’s digital economy ambitions and support the Smart Nation agenda. Its fund platform channels global institutional capital into productive regional assets, reinforcing Singapore’s position as a leading alternative asset management hub.
Systemic Importance
All three companies are index constituents of the Straits Times Index (STI) and are held by CPF Investment Scheme (CPFIS) investors, retail unit trusts, and institutional portfolios globally. Their collective performance is therefore of systemic importance to Singapore’s capital markets and the broader retirement savings ecosystem.
- Risk Register
Risk Category Companies Affected Severity
Global recession Macro All three High
Geopolitical escalation Macro All three High
Stagflation (high rates + weak demand) Macro CICT most exposed Medium-High
USD/SGD currency volatility Macro Keppel, CICT overseas Medium
Larger-than-expected NIM compression Company DBS Medium-High
China real estate loan impairments Company DBS Medium
E-commerce displacing physical retail Company CICT Medium
REIT refinancing risk Company CICT Medium
Failure to reach S$100bn FUM target Company Keppel Medium
Data centre development delays Company Keppel Low-Medium
Investors should consider diversifying across all three companies to reduce single-name concentration, maintaining appropriate portfolio sizing given personal risk tolerance, and monitoring quarterly result announcements for guidance updates.
- Disclaimer
This report has been prepared for informational and educational purposes only. It does not constitute investment advice, a solicitation to buy or sell any securities, or a recommendation to take any particular investment action. All financial data cited in this report is sourced from publicly available company disclosures, SGX filings, and media reports as of February 2026. Forward-looking statements and estimates are inherently uncertain and subject to material deviation. Past performance of any security does not guarantee future results.
Readers should conduct their own due diligence and consult a licensed financial adviser before making any investment decisions. The author and publisher of this report may or may not hold positions in the securities discussed herein. All figures are in Singapore Dollars (SGD/S$) unless otherwise stated.
Singapore Equity Research | Investment Analysis Report | February 2026
DBS Group Holdings | CapitaLand Integrated Commercial Trust | Keppel Ltd