Not many STI listcos provide substantial forward-looking guidance: study

[SINGAPORE] A notable proportion of Singapore’s largest listed companies fail to provide meaningful forward-looking guidance even as they report comprehensively on past performance, new research has found.

A study by stakeholder engagement agency Black Sun Global and the Securities Investors Association (Singapore), or Sias, found that only 13 per cent of Straits Times Index (STI) constituents provide structured medium-term financial guidance.

That figure is significantly lower than the 59 per cent recorded among companies in the FTSE 100 Index.

“This leaves investors with less visibility over how strategy is expected to translate into results over the next few years and makes it harder to track progress against longer-term ambitions,” the study said.

Launched on Wednesday (Jul 29), the report reviewed corporate reporting and investor communications across the 30 largest and most liquid companies on the Singapore Exchange (SGX), which make up the benchmark STI.

“Our research shows Singapore’s largest companies report well on what has happened, yet are more cautious about explaining what comes next – which is exactly where investor conviction is won or lost,” said Neale Few, Asia-Pacific CEO of Black Sun Global.

The findings come as Singapore steps up efforts to revitalise its equity market.

As SGX and the Monetary Authority of Singapore roll out the S$6.5 billion Equity Market Development Programme and the S$30 million Value Unlock scheme, the STI’s charge past the 5,000-point mark earlier this year reflects growing retail participation and renewed investor interest in locally listed companies.

Forward guidance

Masayuki Ozaki, chief financial officer of the manager of NTT DC Real Estate Investment Trust , said investors questioned whether the company would provide forecasts at its recent annual general meeting.

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Speaking at a panel discussion during the Black Sun Global-Sias report launch, he acknowledged that companies hesitate to issue forward guidance due to concerns around how investors interpret those projections.

“As an investor, I always focus not necessarily on the guidance and the numbers (themselves), but the underlying assumptions (from which the guidance is derived),” said Ozaki.

While companies should deliver on the growth they forecast, he noted that it is equally important for investors to understand the assumptions underpinning those projections.

Providing guidance with sufficient context remains a key challenge for companies seeking to build investor confidence.

The Black Sun Global-Sias study found that a firm’s performance can fall short of expectations for various reasons, from geopolitical turmoil and economic uncertainty to skills shortages and a rapidly evolving technology landscape.

What matters is how transparently companies explain setbacks and the actions they are taking to address them, said the report.

Among the examples the study cited is Genting Singapore . Describing 2025 as a “defining transition year”, the integrated resort and casino operator explained to investors that its weaker revenue and profitability were due to major renovation works and the ramp-up of new operations.

The study also highlighted ST Engineering , which disclosed cost overruns and delays in selected defence contracts. And it noted that DBS explained the causes of a significant digital banking disruption and outlined measures to strengthen system resilience.

Melvin Tan, a member of the community engagement sub-committee at Sias, said that these companies’ investor relations teams were able to respond quickly when issues arose.

While many small and mid-cap firms may not have the same resources as these corporates, that should not be an excuse for weaker communication, he pointed out at the panel discussion.

Other findings

The Black Sun Global-Sias study showed that 87 per cent of institutional investors surveyed by non-profit Steward Leadership Institute believe information disclosed by SGX-listed companies is useful in supporting investment decisions.

However, only 18 per cent regarded them as highly transparent.

The research found that most STI companies went beyond simply listing investor relations activities to explain how investor feedback influenced strategy, disclosure or governance decisions throughout the year.

Around 97 per cent of them demonstrated some transparency on outcomes such as enhanced climate disclosures in response to investor demand.

Another finding indicated that despite strong fundamentals, 57 per cent of the STI constituents did not articulate a clear and differentiated investment case.

As a result, investors were often left to infer long-term value creation potential and competitive advantages from financial results alone – weakening investor conviction.

Value Unlock

Speaking at the launch event, SGX Group capital market development director Jeremy Sing said the Value Unlock programme can help companies strengthen investor engagement.

He noted that more than 150 companies are in various stages of discussion, with around 80 firms having taken part in more in-depth engagements.

He also highlighted the Organisation for Economic Co-operation and Development’s recent Asia Capital Markets Report, which found that Singapore has one of the highest proportions of listed companies trading below book value.

About 64 per cent of Singapore-listed companies recorded a price-to-book ratio of less than one, compared with 39 per cent across Asia and 34 per cent globally.

While many factors influence market valuations, Sing said disclosures, transparency and communication remain key areas where companies can improve.

The Value Unlock programme provides multiple levers for firms to strengthen these areas and support improvements in market valuation, he added.

“More work needs to be done in terms of helping companies communicate better (and) look into how they could improve their strategy and capital allocation,” he said.

“We are also trying to push forward more practice on forward guidance.”

Black Sun Global and Sias reviewed the annual and sustainability reports of the STI constituents as at Jul 2, 2026, against 63 indicators.

The annual reports predominantly covered reporting periods ending between Dec 31, 2025, and Mar 31, 2026, with an exception: the latest available report from one company covered the 2024 reporting period at the time of publication.

Sias expects similar research to be extended to companies on the iEdge Singapore Next 50 indices as well as small and mid-cap firms.

“We want to see companies treat transparency not as a burden, but as the way to strengthen shareholder relationships and unlock long-term value,” said David Gerald, Sias founder, president and CEO.