Don’t be fooled by strong pharmaceutical export sales: DBS

It may have increased 38.6%, but DBS says this is purely numerical as the rest of the manufacturing sector is still in a slump.

According to DBS, local manufacturers will have to brace themselves for a winter before spring arrives in the second half of the year.

Here’s more from DBS:

Market will have something to cheer about, at least from a numerical perspective when the industrial production index is announced this Thursday. Overall industrial output is expected to expand by 10.5% YoY in December on account of the strong rebound from pharmaceutical production.

Indeed, latest NODX figure has surprised on the upside with a solid 9.0% YoY (16.4% MoM sa) expansion. Pharmaceutical export sales are once again in the driving seat after a brief slump in November.

Sales were up by 38.6% YoY or about 27% compared to the previous month. And if overall industrial output does coming in strongly, an upward revision in the headline GDP growth figures (3.6% YoY, -4.9% QoQ saar based on the advance GDP estimates) is on the cards.

But this is purely numerical. The boost from the pharmaceutical segment has masked the downside risks facing the manufacturing sector. While the drug sector can grow by leaps and bounce, the rest of the manufacturing sector is in a slump.

Demand from the developed economies has been sluggish while Asia is also cooling. As long as global uncertainties continue to linger, manufacturing output will be affected. In this regards, local manufacturers will have to brace themselves for a winter before spring arrives in the second half of the year.

The people you want to reach are already in this room.

Every quarter, SBR lands on the desks of the founders, CFOs, and directors running Asia's most consequential companies. Every day, they open our newsletter and read our website. It's a room that took twenty years to build — and it's the one most of our partners are trying to get into.

The good news is that the door is open. We work with companies on thought leadership articles, sponsored content, industry summits across Southeast Asia, regional awards programmes, podcasts, and media placements in print and digital. The shape of the right partnership depends on what you're trying to do, which is why we'd rather start with a conversation than send a rate card.

If you have something this room should know about, tell us. We'll tell you honestly whether we can help, and how.

No rate cards until we understand the brief. It's a better use of everyone's time.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia