1. Housing
Population and economic growth, urbanisation and infrastructure development will raise the demand for housing. Meanwhile, rising affluence will lead buyers to seek better quality housing.
Asians spent US$695 billion on housing last year, and by 2020 the annual figure should rise to US$1.11 trillion, estimates DBS. This assumes the US dollar remains constant, and will represent a 4.8% growth every year.
The pace and pattern of this growth will vary according to developments and demographics in each country.
Volume growth will be the main driver in Indonesia and Malaysia in view of the fact that people under 25 years old make up almost half of the populations.
In China, low ownership levels, urbanisation and the fact that many people are
of home-owning age will ensure robust housing demand.
With the Notable exception of Singapore, the provision of housing is left largely to the private sector in Asia, with listed developers controlling 50% to 65 % of the market share.
With regulators trying their best to ensure a stable market, this industry will be sustainable and resilient.
We want to continue to be a part of the Asia growth story.... In particular, urbanisation will trigger increased demand for housing in countries such as China and Vietnam. Capitaland will build tens of thousands of homes in both countries over the next few years.
2. Energy
Demand for energy is expected to grow rapidly, across all segments of the value chain.
The upstream segment includes oil - expected to remain the dominant fuel source - as well as coal and gas, also mooted to play key roles for Asia.
The growth in oil demand is expected to be led by Indonesia, China, Thailand and India. Each of these countries is expected to consume at least 3% more oil every year up till 2020.
In this space, rig-builders such as Singapore's SembCorp Marine and Keppel Corp can stand to benefit. Both these firms sell rigs to companies that drill for oil.
Companies are also investing in downstream services, like electricity generation and distribution, in anticipation of rising demand.
SembCorp Marine's parent company SembCorp Industries runs power plants and KeppelCorp also has a power generation arm.
Keppel is expanding its natural gas-fired cogeneration plant on Jurong Island. Keppel, which has 20-yards in regions including the Asia-Pacific, Gulf of Mexico, Caspian Sea, Middle East and North Sea, is also building rigs and other support vessels for its customers, with demand going strong.
Besides international oil and gas players, national oil companies in Asia are expanding their exploration and production expenditures to meet this demand (for oil).
Another player in the energy space is Malaysia-listed infrastructure group YTL corp, which owns Singapore power generation firm PowerSeraya as well as power stations in Malaysia.
3. Health Care
DBS expects medical expenditure per person in Asia to more than double between now and 2020 to almost equal levels with United States.
It also has 20 patient representative offices in Indonesia, Cambodia, Malaysia and Singapore to attract patients and medical tourists to its hospitals.
4. Agri-business
There will be plenty of people looking for a good meal in Asia, or rather more people being able to afford to do so.
Demand for food from the region is expected to more than double by 2020 to nearly US$3 trillion per year.
But even as Asia - and the rest of the world - guzzle more food, supply has not been keeping up, leading to rising prices, which can potentially benefit companies.
Over the past year, the prices of agricultural commodities have already outperformed industrial metals and stock indexes such as the Dow Jones Industrial Average and STi, though precious metals have fared better.
Companies that can benefit include those in palm oil and rubber, two commodities that rely on Asia to produce the vast majority of global supply.
Palm oil companies like Golden Agri-Resources, Wilmar International, Indofood Agri Resources, First Resources and Kencana Agri are listed in Singapore.
They run plantations, and many are also involved in related activities like processing. Sri Trang Agro-Industry, also listed here, deals in parts of the rubber value chain.
Olam International sells 20 agri-products, including cashew, coffee, and cotton. It has expanded across the value chain, buying plantation and farms, as well as selective expanding into mid-stream and downstream operations like manufacturing food ingredients and packaged foods.
5. Travel and tourism
The newly wealthy people in Asia like to travel domestically, such as within China, using railways and staying in motels or hotels. Businesses near the major connection points - like train stations and airports - are also benefiting.
While the emerging middle class is not spending on high-end luxury, it is massive and it is highcash-flow generating. Travellers from other Asian countries, and from outside Asia, could also boost the region's tourism sector.
According to World Tourism Organisation, China is now the third most visited country in the world, behind France and the US. Malaysia is also popular, coming in at No.9.
In terms of individual cities, Singapore, Kuala Lumpur and HongKong are popular destinations.
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