Funds raised in IPOs so far easily beat last year's total

An SGX sign is pictured at the Singapore Stock Exchange.
An SGX sign is pictured at the Singapore Stock Exchange.PHOTO: REUTERS

NetLink NBN Trust's IPO, which raised $2.3b, made the big difference - it was the biggest in Asia-Pacific in Q3

The amount raised in initial public offerings (IPOs) here so far this year has easily surpassed the funds generated in all of last year, thanks mainly to the blockbuster listing of NetLink NBN Trust in July.

There have been 14 new listings of companies and business trusts on the Singapore Exchange (SGX) this year compared with 15 in the same period last year and 16 for all of 2016.

This year's most recent addition was real estate brokerage Apac Realty, which made a strong debut yesterday to close at 76 cents a share, 10 cents or 15.2 per cent above its offer price of 66 cents.

In fact, 13 of the 14 IPOs this year saw positive first-day returns. NetLink NBN Trust was the exception, closing flat, but it has since inched upwards after analysts initiated coverage.

Excluding Apac Realty, the 13 IPOs so far this year raised US$2.08 billion (S$2.8 billion), up 27 per cent from the same period a year ago.

NetLink's IPO, which raised US$1.7 billion (S$2.3 billion), was not just the largest in Singapore for six years but also the biggest in the Asia-Pacific in the third quarter, said professional services firm EY in a report yesterday.

The Singtel spin-off was also the second-largest IPO in the world in the quarter, after Switzerland's Landis+Gyr which raised US$2.4 billion in July. The third-largest IPO was China's ZhongAn Online P&C Insurance. It debuted yesterday and raised US$1.5 billion.

MORE CROSS-BORDER DEALS

We expect a growing number of IPOs of Internet-based businesses in the coming months, following the footsteps of Y Ventures Group... The SGX remains an appealing equity springboard for South-east Asian companies.

EY REPORT

EY global IPO leader Martin Steinbach said: "Given the strengthening IPO sentiment with relative low volatility and valuations at high levels, we expect a year-end rally in the fourth quarter, traditionally the busiest IPO quarter of the year.

"Final numbers for 2017 could fall in the range of 1,600 to 1,700 IPOs and US$190 billion to US$200 billion in capital raised and this would mark 2017 as the best year for global IPO performance since 2007."

EY said it expects IPO activity here in the fourth quarter to outshine the same period last year, which had only one IPO.

"We expect a growing number of IPOs of Internet-based businesses in the coming months, following the footsteps of Y Ventures Group, a Singaporean e-commerce retailer and distributor that listed on Catalist at the end of June," the EY report said.

It added that more cross-border deals could be expected: "The SGX remains an appealing equity springboard for South-east Asian companies that enjoy robust fundamentals and proven business models. The doubly subscribed US$1.7 billion listing of Singaporean telecoms company NetLink NBN Trust in July underscores SGX's attractiveness and capacity to achieve successful IPOs."

A version of this article appeared in the print edition of The Straits Times on September 29, 2017, with the headline 'Funds raised in IPOs so far easily beat last year's total'. Print Edition | Subscribe