Episode Details

This week, our Host, Seng Yeow opens to a sharp reminder of how sensitive the AI trade has become, with OpenAI disclosing September annualised revenue approaching US$50bn rather than the US$70bn previously indicated, sending Nvidia, Oracle and major semiconductor names down 3-5% intraday. Against this backdrop, the team asks what it means for Singapore and the wider AI value chain, as the local economy rides the AI boom while sticky inflation keeps MAS on a tightening path.

The show leads with our Economist Hak Bin Chua, who expects MAS to raise the S$NEER slope by 25bp to 150bp at its 14 October meeting. He sees 3Q GDP growth of 5.5%, down from 6.1% in 1H, and a firm Singapore dollar, forecasting 1.265 against the USD by year-end and 1.24 by end-2027.

Next up, our Head of Research Thilan Wickramasinghe, explains why Singapore banks sold off despite rising rates, calling it a valuation correction after a roughly 45% YTD rally rather than an earnings downturn. He sees limited margin and credit concerns and keeps OCBC and DBS as top picks.

In telcos, our analyst Husseini argues that Singtel is a differentiated AI enabler, securing customer contracts (S$600m) before committing GPU capex (S$300m). He also sees Optus as a nearer-term catalyst, with EBIT potentially doubling from S$500m to S$1bn by FY30, and little ASEAN risk from Starlink’s spectrum move. He keeps a BUY with a S$5.21 target price, over 25% upside.

Our Hong Kong Strategist Ben Ho then argues that established platforms hold the edge in a capital-constrained AI race. He prefers Tencent, Alibaba and China Mobile, is selective on Baidu and GDS, and urges caution on expensive chip plays and pure model labs.

Finally, our analyst Xuan Hao returns on palm oil, arguing that El Niño, slowing supply growth and rising biodiesel mandates point to a supercycle, and that Bumitama Agri offers purer upstream leverage, with CPO at about 85% of revenue.

Wishing you a profitable trading week ahead!