JT 8.2016This article, written by Jennifer Tan (left, Director, Research & Products,  Equities & Fixed Income, at the Singapore Exchange), originally was published in SGX's kopi-C: the Company brew series on 28 October 2016. The article is republished with permission.

New Silkroutes CEONew Silkroutes Group CEO, Dr Goh Jin Hian. (Photo: Company)

Five years ago, Dr Goh Jin Hian took a vault into the unknown.

In March 2011, when global economies were reeling from the aftermath of the Eurozone crisis, the general practitioner left a 14-year career in Singapore's healthcare industry to start oil and gas trading firm International Energy Group (IEG).

This journey eventually culminated in his appointment last July as the Chief Executive Officer of SGX-listed investment holding company, New Silkroutes Group Ltd (NSG).

"At that time, Europe was still in the throes of a crisis, and when I said I wanted to do something different, headhunters told me I was crazy, and that only one-third of people who change jobs at a time like this would succeed. Even my own parents thought I was nuts," Goh recalled with a laugh.

LQM ad141eI wanted to see if the management skills and competencies I developed during my time in Parkway could be used in other industries.

- Dr Goh Jin Hian

New Silkroutes Group

"Do I relish a challenge? Yes. Am I a sucker for pain? No. I don't like the feeling of uncertainty, but for some things, you've just got to take that leap of faith."

Goh, 48, is the son of Singapore's former Prime Minister and current Emeritus Senior Minister Goh Chok Tong.

He held several executive senior positions in Parkway Holdings Ltd - now known as IHH Healthcare Bhd - between 1999 and 2011, including CEO of Gleneagles Hospital, President of Singapore Operations, as well as Senior Vice President of Growth, Innovation & Strategy.

The Bachelor of Medicine and Bachelor of Surgery graduate from National University of Singapore described his decision to exit a familiar environment as "a kind of mid-life crisis".

"I was 43 in 2011. I had to decide whether to stay on - and if so, be a one organisation person until the day I retire - or do something different," said Goh, who holds a Master of Business Administration from the University of Hull and completed the Wharton Advanced Management Program in 2005.

"I wanted to see if the management skills and competencies I developed during my time in Parkway could be used in other industries."

A Compelling Challenge

The transition was tougher than expected.

"Entering the oil and gas industry was not as easy as it looked," Goh said.

"Despite building a lot of networks during my time with Parkway, and receiving a lot of support from these networks in developing new business initiatives, it was pretty much an uphill trek."

The opportunity for Goh to join NSG emerged three years later, in early 2014.

"My entry into the Group was not something I actively sought - it came about when the company was still operating under the name of Digiland," he recalled.

GohJinHian2LQM ad141eWe wanted a corporate identity that better reflected our ambitions - trade on the ancient Silk Road was a significant factor in the development of the civilisations of China, the Indian subcontinent, Persia, Europe and Arabia.


- Dr Goh Jin Hian

New Silkroutes Group

(Photo: LinkedIn)

"Through a mutual friend, I met the Chairman, Mr Cai Sui Xin. He was eager to take the company out of the SGX Watchlist and turn the business around. We believed it was a challenge we could tackle."

Established in 1994 as a wholesaler of computer peripherals and hardware, Digiland International Ltd was placed on the SGX Watchlist in December 2011 after reporting several consecutive years of losses.

By the time Goh stepped in, Digiland had already obtained a permit to trade marine oil. That eventually paved the way for IEG to be incorporated into the restructured Digiland group.

The reorganised entity, which exited the SGX Watchlist in November 2014, was renamed New Silkroutes Group Ltd last July.

"We wanted a corporate identity that better reflected our ambitions - trade on the ancient Silk Road was a significant factor in the development of the civilisations of China, the Indian subcontinent, Persia, Europe and Arabia," Goh said.

"The name also captures the essence of the exchange of ideas, cultures, philosophies and technologies."

♦  For Better or Worse

The road ahead, however, remained bumpy.

Crude prices began tumbling in mid-2014, but management stuck to its guns. "We felt that the oil and gas business - for better or for worse - was still something we could work on," Goh said.

Several developments worked in their favour. As crude prices sank and trading companies shuttered, teams that were nearly impossible to hire became available for more modest and reasonable terms.

It was also a struggle to convince banks that a tech company with a new management team could survive what was probably the most volatile time in the oil and gas industry's history. But some banks were willing to take a bet on the management and extended credit lines to the Group.

Again, lower crude prices were a boon. "With oil prices plunging by more than half, small credit lines that would not have been very meaningful six months ago suddenly became something we could work with," Goh grinned.

New Silkroutes Group

Stock Price


Market Cap


52-week High Low

26c to $1



FY2016 PAT


Source: SGX StockFacts
(data as of 3 Nov 2016)

Oil prices plummeted from a peak of more than US$100 a barrel in July 2014 to end last year at around US$37 a barrel.

The Group focused only on profitable oil trades. "We structured our trades with friendly counterparties to ensure specific margins were locked in," he added.

Through IEG, the Group's fortunes began to recover. The wholly owned unit is on track to post revenues of over US$225 million for its current financial year ending 30 June 2017 - marking the Group's highest revenue in more than a decade. Under the Digiland brand, the company last chalked up revenues exceeding US$200 million 12 years ago, in FY2004.

In a move that boosts the Group's outlook, IEG set up a joint venture with the government of Malta last May to develop the South European island into an energy trading hub for both continents. IEG also expects to eventually own and manage oil storage facilities in Asia and Europe.

Last week, crude rebounded to a 15-month high, hovering above US$50 a barrel on expectations of an output cut by the Organization of Petroleum Exporting Countries (OPEC). Prices have pulled back this week amid uncertainty over whether OPEC could implement those cuts due to disagreements among its members.

Lofty Ambitions

As the Group's expansion strategies began to take shape, funding needs also escalated.

"By end of last year, we realized we couldn't depend on the usual sources, such as the market or banks, to finance our business. We wanted to take things into our hands, so we decided to develop our own ability to raise capital," Goh said.

As a result, New Silkroutes Capital was born.

Set up earlier this year, the Singapore-based subsidiary offers investment management and advisory services to institutions, enterprises and high net-worth individuals. It has a joint venture in New York that will launch funds for the energy and resource, healthcare, technology and real estate asset classes, as well as develop structured products. The Group's asset management joint venture is also applying for the Capital Markets Services licence from the Monetary Authority of Singapore, which will allow it to offer private equity funds in the region.

Last month, New Silkroutes Group marked its entry into healthcare - a sector close to Goh's heart - by acquiring a 51% stake in Singapore-based Healthsciences International (HSI). A healthcare practice group with expertise in designing, developing and running hospitals, HSI also operates three clinics in the city-state.

NSG presenceMost of New Silkroutes Group's revenues currently come from its wholly-owned oil & gas trading arm, International Energy Group (IEG). IEG is headquartered in Singapore and has business presence Jakarta, Beijing, Tianjin and Malta.
(IEG map)

The Group will continue to seek acquisitions of suitable healthcare services companies - ranging from hospitals and pharmacies to imaging centres and laboratories - in the Asia-Pacific region, Goh said.

As for the restructured Digiland business, now the Group's infocomm technology division, it will focus on big-data analytics, facilities management, and cloud-based services for e-government projects, Goh said.

It will also help regional governments develop public housing schemes, advising them on policies, using the success of Singapore's Housing and Development Board (HDB) programs as a model.

Management hopes to mould NSG into an investment holding company with businesses in investment management, energy/resources, technology and healthcare. This multi-pronged approach aims to turn the Group into "a leadership stock" on SGX, Goh said.

"The foundations of the first three pillars are already being laid, while the fourth will be in place within the next year," he added.

As part of its transformation, the Group also carried out an exercise in August 2015 to consolidate every 500 ordinary shares into one single share to reduce sharp swings in its stock price and comply with SGX's minimum trading price rule. Completed in December 2015, the exercise is the largest of its kind in Singapore's corporate history.

♦  Proof in the Pudding

With NSG issuing more announcements over the last 12 months than in the past 12 years, and changing management five times over that period, shareholder confusion has prevailed.

"At our last AGM, shareholders asked if we were going to stay or flip the company within the next two years. We want to demonstrate to shareholders that we are different in what we do, that we have a good management team who will take our vision and execute it accordingly."

Essentially, the strategy adopted by NSG has evolved in line with the company's DNA, Goh noted.

"We were dealt a certain deck of cards, and based on the fact that this company is in energy and tech, the strategy we put in place has allowed it to develop into what it is now."

LQM ad141eBe the agent of change so you're in charge. Once you're in control of an evolving story, it's not as scary.

- Dr Goh Jin Hian

New Silkroutes Group

And so far, the proof has been in the pudding.

The Group's market capitalization, which plummeted by more than 60% to around S$50 million in FY2011, has since more than doubled to nearly S$120 million today.

In the year 2016 to-date, the stock is the best-performing constituent of the SGX Mineral Oil & Gas (MOG) Index, with a total return of 109%.

"As an investment holding company, we are strategically diversified, and this diversity is not random - there's actually a method to the madness," Goh chuckled.

"Can you benchmark us against any company or any specific sector? No, as our eggs are not in any one basket. Our closest peers are companies like Cheung Kong or Berkshire Hathaway," Goh said, referring to Hong Kong billionaire Li Ka-Shing's investment holding firm and Warren Buffett's NYSE-listed conglomerate.

NSG currently derives more than 90% of its revenues from IEG because the average size of an oil trade is large, Goh said. But the energy division does not command more than 60% of Group profits.

"While IEG will still account for a significant number, you will see increasing contributions from healthcare, asset management and the systems division."

Adapt or Perish

There's more work to be done, he added.

"As with many growth companies, there's a need to deepen the management bench. We've been very lean over the last 20 months, without much capital to spare for hiring new talent. Now that we do, our growth should be more exponential going forward."

By extension, as people are the Group's most important asset, keeping the team together can be difficult, he admitted.

"Managing and retaining talent within the Group is not easy, particularly with a team that has expertise in so many different industries. There is a need to pull everyone together and make sure they run in the same direction. As we continue to evolve into this complex animal, it will become more challenging."

"We are, however, putting in place the right culture - one that's centred on integrity, is people-oriented, and focused on deliverables. That should help."

LQM ad141eOnce you realise learning never stops, and you need to move out of familiar surroundings to develop new skills, change should not be so frightening.


- Dr Goh Jin Hian

New Silkroutes Group

Looking back on the last 20 months, where change has been the only constant, Goh highlights the importance of being adaptable. "Change is inevitable, and everyone should embrace it. You need to be willing to take risks and step out of your comfort zone."

One way to overcome the stress of a volatile situation is to control it. "Be the agent of change so you're in charge. Once you're in control of an evolving story, it's not as scary."

Life-long learning is another principle close to his heart. "Once you realise learning never stops, and you need to move out of familiar surroundings to develop new skills, change should not be so frightening."

The father of three girls aged 12, 14 and 16 constantly reminds his children to develop a thirst for knowledge. "Many kids these days think that after they graduate from college or university, the learning process stops. But I always tell them that even at 50, 60 or 70 years old, you should still be accumulating knowledge."

It's also important to develop a clear moral code, Goh said. "Your word must be your bond, and you should always do things that are consistent with your ethics."

These principles, however, can be hard to uphold, given the complexities of the corporate world, he acknowledged.

"But this is where faith comes in. I believe if you hold fast to your convictions, the right opportunities will emerge."

Financial results

Year ended 30 Jun
2016 2015 YoY Change
Revenue  54,296 38,692  40.3% 
Loss before taxation from continuing operations 3,303 1,594 NM
Loss for the year 3,515 2,573 NM

*NM - not meaningful

Outlook and Risks
  • RQM ad141e Management has put in place various initiatives, laying the foundation for the long-term sustainable growth of New Silkroutes Group Ltd. These initiatives involve fund management, oil and gas trading, security and governance, as well as healthcare. With this strategic framework in place, it believes NSG is poised for better things to come.
  • NSG's transformation is by no means complete and in the coming year, it shall continue to build and renew its management and Board bench strength, thereby enabling the Company "to run and not be weary, to walk and not be faint".

New Silkroutes Group Ltd

New Silkroutes Group Ltd is a Singapore incorporated company listed on the Mainboard of SGX. It is evolving into an investment holding company with core competencies in Capabilities Enablement, Capital Allocation, and (Policy) Analysis. The group, through its subsidiaries and associate companies, has exposure to key sector verticals, including Energy/Resources, Healthcare and Infocomm Technology, with a focus on Security & Governance.

The company website is: www.newsilkroutes.org

Click here for the company's StockFacts page.

For financial statements from its 2016 annual report, click here.

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