HRnetGroup: Better hiring prospects make this a turnaround counter to watch

Jobseekers, recruitment firms and even workers had a trying 2020, as companies tightened their headcounts and put in place cost-cutting measures to cope with the Covid-19-induced economic crisis. And while the labour market — both in Singapore and globally — is showing signs of a slow pickup, CGS-CIMB Research has already pencilled a “buy” call on recruitment firm HRnetGroup with a target price of 63.5 cents.

This follows research from global recruitment firm ManpowerGroup, which shows that Singapore’s net employment outlook is slated to come in at +15% in the first three months of 2021. Specifically, 19% of the employers surveyed expect to increase headcount, versus 4% who expect to trim, while 66% are not expecting any changes.

This +15% outlook is a sharp swing from the –2% outlook registered in 4Q2020 and marks the strongest the metric has been in the last six years. “Recruiters in Singapore we talked to generally believe that hiring activities in 2021 will be stronger than pre-Covid-19 levels in 2019,” write CGS-CIMB Research analysts Darren Ong and Lim Siew Khee in a Jan 19 note.