Thu, 02 Dec 2021

SINGAPORE, Nov. 25 (Xinhua) -- Capital markets across Southeast Asia recorded robust initial public offering (IPO) activity for the first 10 and a half months in 2021, according to a news release from Deloitte on Thursday.

Deloitte said that data as of Nov. 15 showed that companies in Southeast Asia raised a record of 9.8 billion U.S. dollars from 121 IPOs this year, outperforming the full calendar year 2020.

It added that the momentum in IPO activity continues to grow even as the region is still battling the COVID-19 pandemic.

The number of IPOs increased by six percent, while the total funds raised rose by 39 percent, and the total IPO market capitalization grew by 24 percent, compared to the 12 months of last year, said the company, adding that this translates to a 2.8 billion dollar increase in total IPO proceeds and increase in market capitalization to 36.1 billion dollars in 2021.

Deloitte said that Thailand remains for the third consecutive year the Southeast Asian country that raised the highest funds from IPOs, followed by Indonesia, Malaysia, the Philippines, Singapore and Vietnam, thanks to its stable economy, strong currency, low interest rates and consistently strong domestic liquidity. The Thai bourse raised 4.2 billion dollars in IPO proceeds in the first 10 and a half months.

IPOs were scarce in Singapore in the period due to the absence of REITs that typically support the IPO capital market. As of Nov. 15, the Singapore Exchange raised 270 million dollars in IPO proceeds from five IPO deals.

But Deloitte said that the new framework on Special Purpose Acquisition Companies (SPAC) listings introduced this September is expected to help Singapore's capital market bounce back from this dry IPO spell to outperform last year.

"By enhancing secondary listing rules and introducing the SPAC framework, listing aspirants in Southeast Asia with familiar local names have more options and can list closer to home," said Tay Hwee Ling, Disruptive Events Advisory Leader of Deloitte Southeast Asia and Singapore.

She added that the emergence of more IPOs from Southeast Asia will trigger a positive effect and help increase the dynamics of Singapore as an international capital market that provides listing aspirants with a growth platform.

On the outlook for the remaining year and 2022, Tay believes that there is still be a supply of listings to the end of the year and looks forward to Southeast Asia crossing the 10 billion dollar mark, and surpassing the total funds raised in each of the last five years, as the region emerges from the COVID crisis.

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