Drawing secondary listings to SGX may not move the needle much, but every little bit helps
AMONG the recent slew of proposals unveiled to boost the attractiveness of the local bourse to investors and companies was one relating to secondary listings.
The Monetary Authority of Singapore (MAS) proposes aligning disclosure requirements with baseline international disclosure standards, which are already commonly adopted by most established markets, including Singapore.
Specifically, these include the International Disclosure Standards for Cross-Border Offerings and Initial Listings by Foreign Issuers, as issued by the International Organization of Securities Commissions (Iosco).
In essence, these standards allow issuers who already have primary listings elsewhere to use the same prospectuses with minimal adaptation for their secondary listing on the Singapore Exchange (SGX) – a change which simplifies disclosure requirements.
Market players are in favour of the proposal, saying it will attract more companies from varied sectors, thus offering more choice to investors.
An SGX spokesperson reiterates the point: 'As an international listing venue, our role is to provide companies with seamless and broad access to capital at every stage of their growth.'
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Sign Up
Sign Up
For companies with international operations – especially those active in South-east Asia and the broader region – a secondary listing in Singapore offers a compelling opportunity to tap into the deep pools of global capital here, to broaden and diversify their investor base, and to elevate their visibility in a trusted financial hub, SGX added.
The spokesperson noted: 'We have been actively engaging companies and see growing interest from firms looking to use Singapore as a launchpad to expand their global and regional presence.'
Market sources say that sizeable firms in the tech, healthcare and new-energy sectors are eyeing Singapore as a possible destination for a secondary listing. Their market capitalisation ranges from over S$700 million to over S$1 billion.
At these market capitalisation amounts, the new joiners would be on par with the likes of steel fabricator BRC Asia and property and hotel player OUE, in terms of market sizes.
Clifford Lee, DBS' global head of investment banking, said these listings help 'diversify our equity market beyond the local bank-Reit core, to include growth areas like technology and healthcare.'
He noted that 'this could trigger a flywheel effect, under which fund managers are incentivised to develop Singapore market strategies, thus boosting trading volumes and, as a result, attracting more listings. Dual-listed stocks allow Asian investors to deal in Singapore hours and Singapore dollars, reducing foreign exchange and time-zone friction, further unlocking regional liquidity pools'.
The SGX spokesperson told The Business Times that there is a good pipeline of issuers looking at secondary listings on SGX. 'We are also in active discussion with many potential listing aspirants on their listing plans on SGX.'
For companies eyeing a secondary listing in an alternative market, the proposed rule changes are likely to give them a nudge in the right direction.
At the moment, the number of secondary listings – 28 – is a small fraction of the approximately 600 listings on SGX's mainboard and Catalist.
But they do have name recognition. Among the 28 are several long-time secondary listings, including DFI Retail, Hongkong Land, Mandarin Oriental and Jardine Matheson, all of which are part of Hong Kong's Jardine Group.
There are also relatively new – but well-known – names such as the New York Stock Exchange-listed Nio, a Chinese manufacturer of premium smart electric vehicles, and private healthcare service provider IHH Healthcare.
To James Leong, the chief executive officer of trading firm Grasshopper Asia, a company which opts for a secondary listing can 'gain access to new capital pools, increase brand recognition and generally increase liquidity and visibility for the stock. For the market, it provides interesting new products that investors may lack'.
One of the recent secondary listings on SGX is PC Partner Group, which has its primary listing on the Hong Kong Stock Exchange. It joined SGX's mainboard last November.
The global computer electronics player relocated its headquarters to Singapore 'to support and manage the group's continued business growth in South-east Asia and other regions', which points to Singapore's ability to attract capital.
The group added that it plans to leverage Singapore's advantages as a global hub of innovation and technology and to expand into the region.
Whether more such companies will follow in PC Partners' path is the question, notwithstanding reports that some interested candidates are waiting in the wings.
Grasshopper's Leong said: 'While there are definitely companies that would be interested, the decisions are typically contingent on costs and other opportunities – that is, can other markets offer the same value?'
He notes that there are many who are still heading to Nasdaq or the New York Stock Exchange, 'because of the probability of higher valuations that are possible and the immense liquidity in US markets'.
But the US market is not meant for the faint-hearted, with the many companies there clamouring for investor attention.
Given the turmoil in the markets caused by the chop-and-change strategy of US President Donald Trump, it is possible that many candidates in the region may rethink their plans and look closer to home instead.
If Singapore can capture a few more listings, be they secondary or primary listings, it cannot hurt. Every little bit helps in creating a more vibrant marketplace for investors.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Times
8 hours ago
- Business Times
US-China trade talks in London hang over markets
[LONDON] US-China trade talks in London held markets' attention on Monday (Jun 9), with Asian stocks rising, Wall Street mixed and Europe dipping. The London negotiations, following on from a first round in Geneva last month, aim to quell renewed tariff tensions between Washington and Beijing. New York's Dow and S&P 500 indices were lower, while the tech-heavy Nasdaq rose slightly in early trading. Asian shares closed up on hopes of a deal, and catching up with Wall Street from Friday, when US jobs data suggested the American economy was doing well, for now. The US dollar, however, was largely unmoved, with persistent fears of higher US inflation in the pipeline from Trump's generalised tariffs weighing on it. London, Paris and Frankfurt indices were all lower. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up While the US economy was showing resilience, official data on Monday showed China's exports to the US last month grew at a slower pace than expected, even as they picked up to the EU and Asia. The US-China talks took place following a call between US President Donald Trump and Chinese President Xi Jinping last Thursday. They sought a de-escalation after each had accused the other of violating terms of a tariffs reprieve struck in Geneva in mid-May. The US side in London on Monday was being led by Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer, while Vice Premier He Lifeng headed the Chinese team. Their meeting was helped by news that Beijing on Saturday approved some applications for rare-earth exports, while US aviation giant Boeing is to start sending commercial jets to China for the first time since April. Easing China's export controls on rare-earths was key for Washington, 'while China wants the US to rethink immigration curbs on students, restrictions on access to advanced technology including microchips, and to make it easier for Chinese tech providers to access US consumers,' said Kathleen Brooks, research director at XTB. 'The outcome of these discussions will be crucial for market sentiment,' she said. The US dollar's weakness came as economists warned that Trump's tariffs on most of the world could reignite inflation, and as the US Federal Reserve weighs whether to lower interest rates. 'The May minutes and recent comments by several (policy board) members... suggest the Fed is highly attentive to the risk that tariffs will lead to a persistent inflation shock,' wrote analysts at Bank of America. In corporate news, entertainment giant Warner Bros Discovery announced plans to split into two publicly traded companies, sending its share price higher by more than 9 per cent. One would be a Streaming and Studios company covering film and TV production and catalogues, and the other a Global Network company with television brands including CNN and Discovery, and free-to-air channels in Europe. US semiconductor maker Qualcomm also announced it was buying a UK firm, Alphawave, for US$2.4 billion as demand for database infrastructure heated up from demand in the AI sector. Alphawave shares in London jumped more than 22 per cent on the news. Qualcomm's shares rose three per cent in New York. AFP
Business Times
9 hours ago
- Business Times
Asia healthcare assets risk overvaluation as private investors scoop them up
[SINGAPORE] As private equity (PE) investors pour money into Asian healthcare, some observers are concerned that this sector could soon overheat. Some recent deals this year include KKR's US$400 million purchase of a 54 per cent stake in India's Healthcare Global Enterprises in February. In Singapore, another American PE firm TPG took Catalist-listed nursing operator Econ Healthcare private in a deal worth nearly S$88 million. When the proposed transaction was announced in February, the offer price represented a 20 per cent premium to Econ's last traded share price on Jan 14. 'We are not the only ones to see the opportunity of healthcare in Asia, and, as a consequence, valuations can be high,' Abrar Mir, co-founder and managing partner of healthcare-focused PE firm Quadria Capital, told The Business Times. Other factors driving investors to the healthcare sector – perceived as defensive, and so able to withstand the ups and downs of economic cycles – is the ongoing macroeconomic uncertainty and volatility in global financial markets. This is particularly so in Asia, where investors have been diversifying away from China in the last few years, to avoid being caught in the cross hairs of the nation's tensions with the United States. As PE firms and their investors focus on acquiring companies independent of China, more deals have been transacted in Japan, South Korea and India, where the demand for healthcare and related services is strong and largely unaffected by tariffs. 'Japan has always been a stable healthcare market, and particularly because of (its) demographics and medical needs,' said David Braga Malta, thematic health principal at Pictet Alternative Advisors, to BT. 'We saw some of the mid-sized Japanese pharma companies being very acquisitive in the recent months and years... And of course, we saw the boom in the IPO (initial public offering) markets in India last year.' BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Asia's appeal even drew European PE investors to buy South Korean assets for the first time in 2024, he added. Last September, France's Archimed spent US$742 million buying Jeisys Medical, a South Korean developer of aesthetic medicine devices. Like shopping in Louis Vuitton 'One of the key things that I always say to my investors is that... investing in healthcare in Asia is like shopping in Louis Vuitton. So, as an investor, we have to navigate that, be careful not to overpay,' said Quadria Capital's Mir. According to a Bain & Co report, global PE deal value in the sector surged last year to an estimated US$115 billion – the second highest on record. Bain added that PE firms continue to invest in healthcare in the Asia-Pacific, where deal values have been steadily rising since 2016. Industry participants named India as the country attracting the most number of healthcare PE investors. An ageing population, rising incidence of chronic disease and growing awareness of preventive care, combined with the opening up of its insurance market to foreign investment, are making India stand out. Bain estimated that the country made up 26 per cent of the 62 deals transacted in the Asia-Pacific last year. PwC said its health industries practice in India hit a double-digit compound annual growth rate in the past few years as well. But Ling Tok Hong, deals and private equity leader at PwC, cautioned that 'this continued focus on the India market could make it more susceptible to overvaluation if investors are not cautious'. South-east Asia's healthcare sector is also attracting PE investors, leading to 'unprecedented valuations' of Ebitda multiples in their 20s, noted Ling. He was referring to earnings before interest, taxes, depreciation and amortisation. Room for growth; returns still strong Despite the rising valuations in Asia's healthcare sector, market participants point out that there is still room for growth, a key factor backing the higher valuations in the first place. The sector offers attractive long-term growth prospects as the supply of quality healthcare assets in the region is not growing quickly enough to meet demand. In markets such as South-east Asia, 'the number of large, institutionally ready platforms is still limited. This scarcity has helped sustain high entry multiples in recent years', said Alex Boulton, partner and Asia-Pacific lead for healthcare and life sciences private equity at Bain. He pointed out that South-east Asia's healthcare sector relies heavily on private players. For instance, the private sector accounts for roughly half of all hospital beds in Indonesia and the Philippines. 'That structural dynamic creates an enduring role for private capital in expanding and upgrading healthcare infrastructure.' Market participants emphasise that Asian healthcare is not in bubble territory. Boulton pointed out that even with rising valuations, healthcare PE in Asia is still delivering strong returns. Bain's analysis shows that from 2018 to 2023, the median multiple on invested capital (MOIC) for exited healthcare deals in the region was approximately 2.6 – meaning that a US$1 million investment generated a return of US$2.6 million. This compares with the global median MOIC of around two. 'That speaks to the sector's ability to compound value through growth and operational improvement, even in a more expensive entry environment,' noted Boulton. That said, while returns are likely to remain strong in the future, the median MOIC may not be sustained at these levels, he added. Thus, market players said, investors will need to have a clear plan to create meaningful impact and value over the life of their investments.
Straits Times
9 hours ago
- Straits Times
Corporate financier expects to help list at least four Singapore firms on SGX in next 18 months
The developments are being fuelled by a programme to allocate $5 billion in seed capital to Singapore-based funds for investing in local stocks which are not on the benchmark STI. ST PHOTO: BRIAN TEO Corporate financier expects to help list at least four Singapore firms on SGX in next 18 months SINGAPORE - Interest from Singapore firms to list on the local bourse via initial public offerings and reverse takeovers (RTO) has been returning ahead of a $5 billion capital injection that is expected to help revive the local stock market. 'We are currently working on several listings, including the Yangzijiang Maritime spin-off and the proposed reverse takeover involving Sincap and Skylink Apac, both expected to list on the Singapore Exchange (SGX) within the year,' Mr Ong Hwee Li, chief executive of corporate finance firm SAC Capital, told The Straits Times. This follows April announcements by SGX-listed Yangzijiang Financial to spin off its maritime investments into a separately listed company, and by Sincap Group to acquire vehicle leasing firm Skylink for $42.3 million via an RTO, paving the way for Skylink to become publicly listed. SAC Capital is also advising 'two to three' local IPO aspirants in sectors including events management, co-living and natural resources. These firms expect to list on SGX in 2026. 'We are receiving more listing inquiries, about one to two per month, from companies in other industries like construction, food and beverage, technology, and financing sectors, highlighting renewed interest in IPOs,' Mr Ong said. He added that SAC Capital's IPO pipeline is now full, with much stronger investor interest in book-building compared to 2024. Book building is a stage in the IPO process where investors bid for the number of shares they want at certain price points, which helps corporate advisers gauge demand for a company's shares and how to price them before they are listed on the stock exchange. These developments are being fuelled by a central bank-led programme to allocate $5 billion in seed capital to Singapore-based funds for investing in local stocks which are not on the benchmark Straits Times Index (STI). The STI tracks the performance of the top 30 largest and most liquid companies listed on SGX. Announced in February as part of a string of measures to revive the Singapore stock market, the programme has received positive interest from global fund managers. Suitable investment strategies will be shortlisted by end-September, the Monetary Authority of Singapore has said. Analysts reckon the funds will likely be deployed before the end of 2025. Listing interest has gained momentum as a result. On June 6, Bloomberg reported that Hong Kong-based Link Reit is considering listing a Reit in Singapore that would include some of its properties outside of China and Hong Kong, while Japan's Nippon Telegraph and Telephone in its earnings release in May said it plans to list its data centre real estate investment trust (Reit) on the SGX in the future. In May, Reuters reported that at least five companies from mainland China or Hong Kong are planning IPOs, dual listings, or share placements in Singapore in the next 12 to 18 months. The companies include a Chinese energy company, a Chinese healthcare group, and a Shanghai-based biotech group. In April, LHN Group announced plans to take its co-living business Coliwoo Group public on the SGX. The real estate management services group, dual-listed in Singapore and Hong Kong, said it has submitted applications in both places for the proposed spin-off and separate listing of the shares of Coliwoo on the mainboard of SGX. In January, Centurion Corp said in a bourse filing that it is exploring the establishment of a Reit involving some of its worker and student accommodation assets that it plans to list on the SGX mainboard. US data security firm AvePoint, which trades on Nasdaq, in January also filed for a secondary listing in Singapore. If they take place, these listings will give the SGX a much-needed boost after the bourse saw just four IPOs in 2024, a record low. The bourse hosted just one notable IPO in 2025, that of automotive group Vin's Holdings, which is now trading at 29 cents, close to its IPO price of 30 cents. Key to their success is how the shares are traded post-listing, Mr Ong said, noting that many IPOs, particularly on Catalist, are too small and have controlled floats, where a company limits the number of shares available for public trading. While a limited float may initially create strong demand and price momentum, it also means there is little market depth to absorb selling pressure once investor sentiment shifts. Mr Ong noted that SAC Capital encourages retail participation in the IPOs it manages by offering ATM tranches, which allows retail investors to apply for shares directly through their bank ATMs. He added that retail investors who receive shares through the ATM tranche tend to trade more actively, contributing to a more diversified and engaged shareholder base post-listing. Join ST's Telegram channel and get the latest breaking news delivered to you.
