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Singapore IPO market2017 mid-year report
Singapore IPO market | 2017 mid-year report
02Report as of June 30, 2017
Key takeaways 03
IPO listings on the SGX 04
Singapore IPOs: Catalist listings 06
SGX in the news: market watch 07
One Belt, One Road 08
Singapore IPO market | 2017 mid-year report
03
Key takeaways
"We are seeing a great start to the IPO activity this year with nine IPOs. If we take into consideration the one registration and three lodgements as at 30 June 2017, we are seeing unprecedented level of funds raised since 2013.”
Dr Ernest Kan, Deputy Managing Partner (Markets), Deloitte Singapore, July 3, 2017
Singapore's IPO market set for a strong rebound in second half of 2017
Record high capital raising is expected with blockbuster listings in the pipeline
Strong post-IPO performance of the companies listed in 2017 H1 to drive positive market sentiment
123
Singapore IPO market | 2017 mid-year report
04
IPO listings on the SGX2017 H1
Singapore saw nine IPOs in the first half of 2017, raising S$464 million with total market capitalisation of S$2.14 billion. This compares to the seven IPOs in the first half of 2016, which raised S$1.6 billion with market capitalisation of S$2.24 billion.
Market capitalisation of IPOs in 2014 to 2017 H1
886
2,564
56
456
1,608
655 464
0
500
1,000
1,500
2,000
2,500
3,000
2014H1
2014H2
2015H1
2015H2
2016H1
2016H2
2017H1
Amt R
aise
d (S
$'m
)Am
t Rai
sed
(S$'
m)
1,608
464
2016 H1 2017 H1
ActualLodgements / registrations as at June 30
0
500
1,000
1,500
2,000
2,500
3,000
1,881
3,018
2,5541273
2014H1
2014H2
2015H1
2015H2
2016H1
2016H2
2017H1
8,081
7,221
412
1,476
2,238 2,157 2,144
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
IPO
Mar
ket C
ap (S
$'m
)
In addition to the nine IPOs, there were one registered and three lodged deals as at June 30, 2017 including NetLink NBN Trust, which are expected to raise approximately S$2.6 billion. This brings the total amount raised in 2017 to approximately S$3.0 billion, almost doubling that of 2016 on a year-on-year comparison.
Amount raised in 2016 H1 and 2017 H1 including lodgements / registrations
1 This covers IPO lodgements / registrations up to June 30, 2017 detailed below:
Mainboard/ Catalist
Lodgement/Registration Date
Estimated Amount Raised (S$’million)
Aspen (Group) Holdings Limited
Catalist 23-Jun-17 192
NetLink NBN Trust Mainboard - Trusts 27-Jun-17 2,5083
Union Gas Holdings Limited
Catalist 28-Jun-17 192
Y Ventures Group Ltd.
Catalist 30-Jun-17(Registered)
84
2 Estimated using average amount raised for the seven Catalist IPOs in 2017 H1.3 Estimated using average amount raised computed based on minimum and maximum offer price extracted from the preliminary prospectus of S$0.80 and S$0.93 respectively.4 Estimated based on placement of 35,000,000 shares at S$0.22 each extracted from the offer document.
Amount raised in 2014 to 2017 H1
Singapore IPO market | 2017 mid-year report
05
With two Mainboard and seven Catalist listings in the first half of 2017, Singapore IPO market is off to a promising start.
# Company Mainboard/Catalist
Date of listing
Amount Raised
(S$'million)
IPO Market Cap (S$'million)
Offer Price (S$)
First Day
Closing Price (S$)
Share Price % Change
from Offer Price
Share Price as at
Jun 30, 2017(S$)
Share Price % Change
from Offer Price
1 Samurai 2K Aerosol Limited
Catalist 16-Jan-17 4.00 20.00 0.200 0.245 23% 0.425 113%
2 Dasin Retail Trust
Mainboard - Trusts
20-Jan-17 153.87 439.69 0.800 0.805 1% 0.805 1%
3 Kimly Limited Catalist 20-Mar-17 43.45 288.70 0.250 0.440 76% 0.365 46%
4 UnUsUaL Limited
Catalist 10-Apr-17 19.40 128.65 0.200 0.435 118% 0.510 155%
5 Aoxin Q & M Dental Group Limited
Catalist 26-Apr-17 11.40 71.16 0.200 0.240 20% 0.220 10%
6 Sanli Environmental Limited
Catalist 08-Jun-17 11.70 60.45 0.225 0.375 67% 0.305 36%
7 World Class Global Limited
Catalist 15-Jun-17 35.36 235.48 0.260 0.275 6% 0.260 0%
8 HRnetGroup Limited
Mainboard 16-Jun-17 174.06 866.79 0.900 0.925 3% 0.890 -1%
9 Shopper360 Limited
Catalist 30-Jun-17 11.02 33.18 0.290 0.295 2% 0.295 2%
Total 464.26 2,144.10 35% 40%
Number of IPOs: H1 vs. H2 trend
2011 2012 2013 2014 2015 2016 2017
H1 11 7 10 9 3 7* 9
H2 10 15 17 20 10 9 ?
* Excludes secondary listing of Top Glove Corporation Bhd
The number of H1 IPOs in 2017 increased in comparison to the past two periods.
Top performerLargest IPO in 2017 H1
All 2017 H1 IPOs have shown positive post-listing performances both at first day closing and current prices.
Singapore IPO market | 2017 mid-year report
06
2014H1
2014H2
2015H1
2015H2
2016H1
2016H2
2017H1
2014H1
2014H2
2015H1
2015H2
2016H1
2016H2
2017H1
152 154
56
181
55 52
136
0
50
100
150
200
643
844
412
1,082
250 279
838
0
200
400
600
800
1,000
1,200
Amt R
aise
d (S
$'m
)IP
O M
arke
t Cap
(S$'
m)
Singapore IPOs: Catalist listings
No matter what market sentiments are, the Catalist market remains strong.
Amount raised for Catalist IPOs in 2014 to 2017 H1
Market capitalisation of Catalist IPOs in 2014 to 2017 H1
The Catalist market shows a strong presence despite market conditions
• 2017 H1 Catalist IPOs had the highest amount raised and IPO market capitalisation in the past five half-years, with the exception of 2015 H2. This can be attributed to several sizeable Catalist listings in 2017 H1 (Kimly Limited and World Class Global Limited) and 2015 H2 (e.g. Jumbo Group Limited and Soo Kee Group Limited).
Post-IPO AcquisitionsKimly Limited and Aoxin Q&M Dental Group Limited have made sizeable acquisitions within two months post-listing.
• Kimly has acquired a coffee shop and an industrial canteen, with payment mainly through issuance of new shares.
• Aoxin Q&M’s success also helped parent Q&M Dental Group (also SGX-listed) add two new dental clinics in Singapore while incorporating a new company to act as the holding company for expansion of its Malaysia’s business.
IPO has served to expedite their expansion plans, sending a positive signal to their investors and other potential IPO aspirants.
No. of deals2014 H1
2014 H2
2015 H1
2015 H2
2016 H1
2016 H2
2017 H1
Mainboard 2 4 - - - 2 1
Mainboard – Trusts 1 4 - 1 2 1 1
Catalist 6 12 3 9 5 6 7
Total (half-year) 9 20 3 10 7 9 9
Total (year) 29 13 16
Singapore IPO market | 2017 mid-year report
07
SGX in the news: market watch
"We are expecting a strong pipeline of blockbuster listings in 2017 H2 and coupled with the strong post-IPO performance of the companies listed in 2017 H1, Singapore’s IPO market is certainly buzzing with excitement."
Dr Ernest Kan, Deputy Managing Partner (Markets), Deloitte Singapore, July 3, 2017
Signed four Memorandums of Understanding ("MOUs") with industry partners – an equity crowdfunding platform, a venture hub, Infocomm Media Development Authority and A*Star’s commercialisation unit – with an objective to bolster Singapore's technology and small-and-medium sized enterprise (SME) start-up ecosystem by boosting access to growth capital. ( June 21, 2017)
The SGX is not ruling out the idea of a third board where shares of private companies could be traded. “We are working with some of you, in terms of thinking about how and when and if we should have a private exchange in Singapore,” Mr Mohamed Nasser Ismail, SGX head of equity capital market for SMEs. ( June 21, 2017)
Singapore IPO market | 2017 mid-year report
08
One Belt, One RoadOpportunities and challenges
BackgroundThe One Belt, One Road ("OBOR") Initiative refers to the Silk Road Economic Belt and Maritime Silk Road launched by the Chinese government, Xi Jinping, since 2013. It aims to connect countries in Asia, Europe and Africa through land and sea routes.
Key Focus / Implementations from OBOR Initiative
Impact on Southeast Asia RegionThe OBOR initiative will strengthen economic linkages between countries in the Southeast Asia (“SEA”) region. Since the implementation of this initiative, there has been a significant increase in bilateral trade between China and SEA countries and this is expected to continue rising. The initiative will also create positive spillover effects from initial infrastructure projects and further facilitate investments. Short Term ImpactNegative:1. Many countries along the OBOR may lack
the financial capcacity to develop their infrastructure.
2. Companies may would face higher costs due to the supply chain interruptions from the trade barriers, affecting the competitiveness of SEA businesses.
Positive:1. Better trade opportunities for SEA region
with the improved infrastructure. 2. Companies in SEA can partner with
Chinese players and subsequently, leverage this partnership to tap into Chinese markets.
3. Financial players in the market such as private equity firms and investors can discover potential investment opportunities.
1 Improvement of Transportation Infrastructure
Establishment of an efficient and secure network of land, sea, air passages across key routes to facilitate trade
2 Reduce Barriers to Trade
Easing customs and quarantine processes to overcome trade barriers
3 Greater Policy Cooperation
Opening of free trade areas and improvement of cooperation in new technologies
4 Facilitate Financial Integration
Support foreign countries to issue RMB denominated bonds
Impact on Initial Public Offering (IPO) market1. OBOR initiative will result in a positive outlook for SEA’s IPO. As China is facing
problems with overcapacity, it urges Chinese companies to pursue trade projects in SEA, to tap on the SEA regional pool of fund managers and investors.
2. During the IPO of China Energy Engineering Corp (CEEC), which is listed in Hong
Kong, the Silk Road Fund has become the largest cornerstone investor in the $1.96 billion IPO. This is the second time the Silk Road Fund has invested in an IPO in Hong Kong. As it seeks to expand overseas, including SEA region, this will attract more investors and boost their confidence in times of market volatility.
Long Term Impact • The OBOR Initiative has a positive outlook for developing countries. It will also strengthen private sectors in many countries, including those in SEA region.
• If OBOR contributes to greater trade and greater economic collaboration, this initiative will reshape global trades and bring prosperity to many countries.
Singapore IPO market | 2017 mid-year report
09
One Belt, One RoadDeloitte's involvement
As one of the world's leading professional service organisations, Deloitte has vast experience and is able to advise and assist investors on their overseas ventures. We have been proactively reaching out to many Chinese companies interested in investing in SEA.
In particular, our Singapore, Indonesia, Malaysia, Thailand and Vietnam practices have been cooperating as a cohesive team to work with the various government bodies in SEA to promote investment opportunities in our region. By liaising closely with these government agencies, Deloitte provides opportunities for them to join our roadshows so that they can share details about infrastructure projects in SEA with potential investors.
Deloitte organised two OBOR roadshows in Kunming, Yunnan in the first half of 2017. The roadshows were very successful and provided valuable networking opportunities as they were attended by numerous representatives from government bodies, research institutions, businesses from Yunnan and SEA countries, as well as various Deloitte leaders.
Deloitte Southeast Asia has been proactively reaching out to Chinese companies interested in investing in Southeast Asia.
“One Belt, One Road Walk into ASEAN” (March 14, 2017)Deloitte SEA, in collaboration with Yunnan Energy Investment Group (YEIG), Yunnan Press Group and the Department of Commerce of Yunnan Province Representative Office in Singapore, held the roadshow in Kunming, Yunnan. This informative event was attended by many Chinese businesses, where presentations of policies and the sharing of key investment programs and infrastructure investment opportunities throughout the region by representatives from five SEA countries' government agencies were held.
The 1st China-Southeast Asia Business Forum (CSEABF) (June 14, 2017)Supported by Yunnan International Expositions Bureau and China Council for the Promotion of International Trade (CCPIT) Yunnan Sub-Council, Deloitte organised this sub business forum during the 2017 South and Southeast Asia Commodity Expo and Investment Fair (SSACEIF) held in Kunming, Yunnan. This event stressed the importance of regional collaboration between China and SEA via the OBOR Initiative, and involved Deloitte leaders as panelists in sharing experiences on investing and trading in SEA, as well as services Deloitte can provide to facilitate investments.
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