Temasek Bond (T2023-S$) vs Astrea Bond vs SIA retail Bond – Which To Look At!

This was Temasek's first bond offering to retail investors back in Oct2018.

Maybe it was to be try to lead the way for more corporates to issue bonds to retail investors. But sadly, not many followed.

Let's dive in to analyse it vs Astrea bond vs Singapore Airlines (SIA) bond. 

All 3 are retail bonds which means you can purchase with just 1,000 lots.

Performance of Temasek 2.700% 25Oct2023 Qsov (SGD) Bond

Bond is AAA rated which means lowest risk and matures in 25 Oct2023.

Yield to maturity (now) is about 0.82%p.a.

This is pretty low and unless you are comparing against SSB at 0.31%pa average for 3 years (sep2020 issue), there is little to get excited about.

Hence the next two other retail bonds to consider.

Compared to the ASTREA PE BONDS

In June18, Astrea Capital IV Pte. Ltd which is wholly-owned by Azalea Asset Management Pte. Ltd. (“Azalea”) and is part of Temasek launched ASTLC 4.350% 14Jun2028 Corp (SGD).

Then in Oct2018, ASTLC 3.850% 20Jun2029 Corp (SGD) was launched.

Both are private equity (PE) bond backed by cash flows from a diversified portfolio of PE funds instead of a company. It is still rated A on S&P

Both of these bonds are 10years but have a call date at the 5year mark. Example, for ASTLC 4.350% 14Jun2028 Corp, first call date is 14June2023.

Compared to Singapore Airlines Bond SIASP 3.030% 28Mar2024 Corp

This bond matures in 28Mar2024.

It is NOT rated but DPM Heng Swee Kiat has stated

""Through the government support for the aviation sector, and if necessary more direct support measures, we will make sure that SIA is able to come through this in good shape," he said.".

Yield to maturity (now) is about 3.2%p.a. Price has recovered since the crisis in Mar2020.

Last words

Personally, I'm not too clear about the Astrea retail bonds due to the PE structure. 

Hence, I'd lean towards SIA retail bond which seems simpler and pays a much more decent yield. It must be noted that the risk on the bonds may not be the same. 

With the recent $13B rescue package from Temasek, I believe SIA's balance sheet is very much stronger.

But as always, diversify with a bond fund if you're investing large sums of savings.

PS: Video on Keppel Corp after Temasek pulls out of partial offer!