Why is it that there is an oversupply of 40,000 existing and new private apartments and there is still an uptake of more condo releases coming up? What are the developers thinking?

Developers bought the land earlier on especially during the recent enbloc fever. From the developer’s point of view, they need to quickly launch their projects in order to get enough buyers first, rather than to delay and give the chance for other Developers to capture the same group of eligible buyers.
Also, as above, many enbloc owners are only recently displaced and will have the means to purchase a replacement home and even an additional investment home from their enbloc gains.

Developers with sufficient buyers initially will have the sufficient means to hold and wait for the supply to dwindle later on, as they would have broken even from their initial sales. Which is why you don’t see property prices going down, and may still increase as recent URA flash estimates show.

many Developers with completed projects would have to replace their land banks, and with gls supply dwindling as well, Developers will also be bidding for the lower supply as well. They are planning ahead years in advance.

Developers don't really have a choice. Much emphasis is placed on the cooling measures consumers face, but developers will have to pay extension fees based on Qualifying Certificate (QC) rules for unsold units. As such they have no choice but to hope to sell them off.