Singapore IPO market outlook is improving

SINGAPORE: Singapore’s decision to launch new funds to support startups will help companies research Initial Public Offerings (IPOs), although it could be years before Singapore Exchange (SGX) becomes a listing center regional technology, according to market players.

Despite touting itself as one of the major financial centers in Asia, Singapore has experienced a decline in quotations over the past decade and has failed to attract large IPOs.

Market players, however, claim that the creation of two funds with a capital of S $ 2 billion (US $ 1.5 billion or RM 6.28 billion) for fundraising and corporate IPOs, coupled with allowing blank check companies to register in the city-state, will attract more startups to register.

“The value proposition of the Singapore ecosystem to founders and shareholders of high growth companies is that it will be part of the company’s journey – before, during and after the IPO,” Ho Cheun said. Hon, Head of South-East Asian Equity Markets at Credit Suisse.

“This should resonate with some founders and entrepreneurs, especially the unicorns who are starting to think about public listings.” The city-state has a long way to go.

So far this year, through September 16, only three companies were listed on SGX, raising US $ 239 million (RM1bil), according to data from Refinitiv.

The amount raised is less than half the figure for the same period last year and the lowest level in six years.

In comparison, funds raised on the Malaysian stock exchange amounted to US $ 531 million (RM 2.22 billion), the Indonesian and Philippine stock exchanges each attracted US $ 2.3 billion (RM 9.63 billion). , while the Thai stock market exceeded $ 3.5 billion (RM14.66 billion). ).

As tech deals in Southeast Asia explode, Singapore is looking to gain more attention after some large companies have chosen to list elsewhere in recent years.

Singapore-based games and e-commerce company Sea is listed in the United States in 2017, for example, and is now valued at US $ 182 billion (RM 762.31 billion). Southeast Asian grocery delivery and delivery company Grab is also listed in the United States, through a blank check company, while games company Razer debuted in Hong Kong in 2017.

Vinnie Lauria, founding partner of Singapore-based Golden Gate Ventures, praised the government’s attempts to foster startup success.

“This is another example of Singapore using capital and smart government programs to market itself as the hub for Southeast Asian startups. “

Robson Lee, partner at Gibson, Dunn & Crutcher LLP law firm, said the Singapore market has the potential to “move beyond its lightness by being better organized and coordinated to attract unicorns and global high-tech companies.” – Reuters