Temasek Holdings, Singapore's state-owned investment firm, has achieved a record-high portfolio net value.
The strong performance is largely attributed to the robust showing of its Singapore-based portfolio companies.
The firm has outlined plans to concentrate on three key areas: artificial intelligence, private credit, and what it terms "core-plus infrastructure."
For the financial year ending March 31, 2026, the net value of Temasek's portfolio rose to S$518 billion (approximately US$401 billion), setting a new historical high for the second consecutive year.
The total shareholder return for the year was 10.5%. The company stated that this strong performance was primarily driven by gains in its Singapore-listed holdings and proceeds from asset divestments.
Supported by the Singapore central bank's market development initiatives, which have helped unlock valuations, the Straits Times Index gained over 23% between April 2025 and March 2026.
Temasek noted that the geopolitical conflict involving Iran, which began on February 28, negatively impacted the portfolio value by approximately 2%, suggesting that the annual return would have been higher without this event. Additionally, the strength of the Singapore dollar reduced the total shareholder return by 2 percentage points.
Key Singapore-based holdings in Temasek's portfolio include DBS Group, Southeast Asia's largest bank, Singapore Airlines, and telecom operator Singtel.
During the financial year, Temasek completed S$31 billion in divestments, including the sale of its stake in India's Schneider Electric for S$8.18 billion in June 2025.
The company reported that multiple headwinds in the Chinese market from 2021 to 2024 contributed to a five-year total shareholder return of only 4.6%. In recent years, Temasek has been reducing its exposure to China, with its portfolio allocation decreasing from 29% in 2020 to 17% in 2026.
However, Temasek emphasized its "continued confidence in the China market," pointing out that in absolute terms, its investment value in the world's second-largest economy actually increased by S$10 billion over the past year.
The total shareholder return over a ten-year period, measured in Singapore dollars, stands at 7.1%.
Key Focus Areas for Investment
Temasek identified three sectors with significant investment potential: artificial intelligence, private credit, and "core-plus infrastructure" encompassing renewable energy, nuclear power, energy storage, and decarbonization technologies. The firm aims to increase its allocation to such infrastructure assets to 5% of its portfolio within the next five years.
By 2031, Temasek plans to increase the proportion of its portfolio related to artificial intelligence from the current 6% to 15%.
The firm has already invested in U.S.-based companies like Anthropic and OpenAI. It intends to pursue a full-stack investment strategy across the AI value chain, covering cloud service providers, foundational large language models, and AI applications.
"We believe the rapid advancement of artificial intelligence is at a critical inflection point, which will create a vast array of new investment opportunities," the company stated.
Regarding private credit, Temasek plans to more than double its allocation in this sector, aiming for 5% by 2031, up from the current 2%.
The focus will be on senior secured products that offer downside protection, including corporate loans, asset-backed financing, and real estate credit, as part of its strategy to enhance portfolio diversification.
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