shareswizard of 10years and still going strong

DJ TAKING STOCK: Solid Singapore IPO Market Overlooked (2009/11/20 16:51PM)

By Kirsty Green
A Dow Jones Newswires Column
SINGAPORE (Dow Jones)--Given Singapore''s recent track record on initial public offerings, it seems a little odd that some local companies are turning to the Hong Kong market to try and unlock value.
While the Singapore market may lack the glamour of its regional rivals, when it comes to IPOs, it''s no lame duck. In the last three months, Singapore has seen every single IPO rise on its debut.
That''s a record to turn major regional rival Hong Kong green with envy. Yet Singapore companies still turn to Hong Kong in the hope of injecting a little fizz into their share prices.
But they may find it is a trickier affair these days. Take palm oil giant Wilmar, whose planned Hong Kong IPO of its China business has been stalled for months while the company monitors stock market conditions.
In contrast, property developer CapitaLand''s decision to float its shopping malls unit, CapitaMalls Asia, in Singapore looks shrewd. The Singapore market appears to have had no problem absorbing what will be its largest IPO in over a decade. In fact, the market has lapped it up.
The CapitaMalls Asia IPO, which will raise up to S$2.8 billion, was quick to come to market, priced near the midpoint of the planned range and was upsized amid strong demand from institutional investors. All the signs are that the IPO will be another Singapore success story with trading in the stock due to start on November 25.
The business that Wilmar plans to float is a China one, so it could be argued it makes geographical sense to list in Hong Kong. But the majority of CapitaMalls Asia''s shopping malls are also in China, so it too could perhaps have gone down the Hong Kong route. In hindsight, its decision not to looks a wise one.
It''s fair to say that Singapore has less IPO issuance to absorb than Hong Kong, which can help a company attract more interest for its offering. There are also simply fewer companies listed in Singapore, so a new entrant can frame itself as a unique play.
Analysts say that this means Hong Kong investors are a little more choosy compared with their Singapore counterparts. And Singapore investors also tend to be less cynical and trust that IPOs will be attractively priced.

my own comments--(remember chartered semiCON??)

Singapore''s receptive investors are nothing new. In the first three months of this year, when rights issues rather than IPOs were all the rage, the Singapore market digested over US$3 billion worth of rights issues, according to Dealogic. That was two-thirds of the entire equity issuance in the Asia ex-Japan region.
With Singapore''s quietly buzzing IPO market, maybe local companies should look on their own doorstep first when they want to tap the market.
(Kirsty Green covers Singapore''s stock market for Dow Jones Newswires. Previously based in London, she spent four years as an equity research analyst at JPMorgan and HSBC. She can be reached on 65 6415 4158 or by email at kirsty.green@dowjones.com)
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(END) Dow Jones Newswires
November 20, 2009 03:51 ET (08:51 GMT)
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