The SRS Fund Aug 2026

Electronics Powers Singapore’s Growth

Aug’s economic update provided another reminder of how closely Singapore has become connected to the global investment in AI and semiconductors.

On 11th Aug, MTI raised Singapore’s full year GDP growth forecast 4.5% – 5.5% from its earlier projection of 2% – 4%. The economy expanded by 5.9% year on year in the second quarter, bringing growth for the first half of 2026 to 6.1%. MTI attributed the upgrade to a stronger than expected first half and an improved outlook supported by accelerating global AI investment.

What I find particularly interesting is the importance of electronics within our economy.

We often associate Singapore with banking, property and trade. Yet electronics has become a substantial economic pillar in its own right. In 2025, the industry accounted for 43.2% of manufacturing’s nominal value added and 8% of the economy’s total nominal value added. Within electronics, semiconductors represented 80.2%, up from 45.6% in 2000.

Those figures help explain why developments in the semiconductor industry matter so much locally. The global demand for computing capacity reaches into the businesses, engineering capabilities and industrial supply chains that Singapore has spent dacades developing.

For the SRS Fund, this is a relevant backdrop. Manufacturing remains the largest portfolio segment and AEM remains the largest individual holding.

However, a growing industry does not automatically make every company within it a successful investment. The opportunity still has to translate into orders, earnings and cashflow. The price paid for that opportunity matters just as much.

Record Tax Revenue and the Next Phase of Building

IRAS collected $97.3b in FY25/26, an increase of 9.4% over the previous financial year. Corporate income tax remained the largest contributor, rising from $30.9b to $34.4b.

The total collection was the highest in the IRAS data series dating back to 2002.

The expansion in electronics and semiconductors can contribute to government revenue though higher taxable profits, employment income and business activities among suppliers and supporting services. The GDP and tax figures cover different periods and the tax annoucement does not isolate the sector’s contribution. Nevertheless, I see the electronics boom as a plausible contributor to the stronger revenue base.

This is how the benefits of industrial growth can extend beyond companies and shareholders. Stronger government revenue improves Singapore’s capacity to invest in the infrastructure needed for its next phase of development.

There is already a substantial pipeline. BCA projects $47b – $53b in construction contracts for 2026, supported by projects including Changi T5, the new Tengah General and Community Hospital and MRT extensions. For 2027 – 2030, annual construction demand is projected at $39b – $46b. These figures cover both public and private projects.

Many of these developments were planned well before the latest revenue figures emerged. My view is that stronger public finances imporve Singapore’s ability to sustain infrastructure investment over an extended period.

For investors, this creates an area worth watching beyond the immediate beneficiaries of AI spending. Engineering, construction, equipment and supporting services may all find opportunities within that pipeline. The challenge is identifying businesses that can turn activitiy into attractive profits without taking on excessive costs or risks.

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SRS Fund Performance vs. Benchmark

As at 31st Aug 2026, the SRS Fund value stood at $921,839, compared with $927,332 at the end of Jul.

After seeing the SRS Fund rise from approximately half a million in early 2025 towards nearly $1m within a relatively short period, it would be unrealistic to expect the journey to continue without setbacks. Markets rarely move in straight lines.

This represents a decline in portfolio value of approximately 0.6% during Aug. Reported year to date performance remained strong at 51.6%

Performance Comparison

Metric	The SRS Fund	STI Index (Benchmark)
YTD Return (Apr 2026)	+51.6%	~+28.3%
Cash Weighting	0.6%	N/A
Top Holding	AEM Holdings (24.5%)	DBS (~29.3%)

Portfolio Segments

Manufacturing ended Aug marginally ahead of Finance with the two sectors continuing to dominate the portfolio

AEM remained the largest holding at 24.5% followed by DBS at 21%. Together, they represent 45.5% of the SRS Fund

The other leading holdings are SATS (8.5%), iFast (5.8%), CapitaLand Invest (4.3%), OCBC (3.4%) and Food Empire (3%).

The economic developments discussed above are relevant to this portfolio but the concentration deserves equal attention. Manufacturing and Finance together account for 71% of the SRS Fund. Confidence in these businesses needs to be accopanied by an awareness of how much the portfolio depends on them.

Dividends

Dividend income for Q3 reached $5,480 by the end of Aug. Bringing total dividends received during 2026 to $20,521.96.

These dividend distributions provide cash that can be reinvested even when share prices are making little progress. Over time, the recurring income becomes an increasingly meaningful part of the SRS Fund’s ability to grow.

SRS Fund Value

During Aug the SRS Fund reached the value of $1m for a single day following a surge in AEM’s share price.

After years of building the portfolio, it was satisfying to see that number appear nevermind briefly.

The SRS Fund value subsequently fell back and ended the month at $921,839.25. The month end chart therefore does not capture that temporary milestone.

While I do not want to dwell too much on having reached the $1m and then falling back, a single day valuation reflects what the market is willing to pay for the holdings at that moment. What matters over time is whether the underlying businesses continue to grow their earnings and value.

I will continue to remain patient. There is no need to force the portfolio back above a particular number or let a brief milestone change the way I invest.

Cash Levels

Cash stood at 0.6% at the end of Aug, leaving the SRS Fund almost fully invested.

This gives the existing holdings considerable influence over the SRS Fund’s performance while leaving limited immediate capacity for new purchase. Dividend receipts help replenish cash but any substantial new investment would require a review of the current allocation.

At this level of investment, position sizing and the relative attractiveness of existing holdings remain especially important.

Closing Thoughts

The month left me thinking about how Singapore’s manufacturing success can benefit the wider economy. Stronger electronics activity can support business earnings, employment and tax revenue, helping strengthen the country’s capacity to invest in its future.

For the SRS Fund, the month brought a modest decline in closing value, a growing dividend total and a brief visit to the $1m mark.

It was a welcome milestone but I am comfortable being patient. My attention remains on the businesses I own, the cash they generate and their ability to compound over the years ahead.

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