Overview
Systematic approach dedicated towards public listing of companies; collaboration with Chinese companies to expand investor base
Singapore offers a large listing for public companies that includes several categories under which companies fall. These include unlimited public companies, public companies limited by shares and public companies limited by guarantee. The Singapore Exchange (SGX) offers two types of public listings for companies in Singapore. They are:
Mainboard - offering services catering to the needs of well-established enterprises. These companies are provided with access to a range of institutional and retail investors.
Catalist - This type caters to fast-growing enterprises that need to be brought to list by authorised sponsors using an IPO (initial public offering) and reverse take-over.
Chinese companies that meet Singapore’s regulatory and governance standards are provided a Direct Listing Framework. This attractive platform enables the country to gain access to global investors. In collaboration with the China Securities Regulatory Commission (CSRC), a number of key requirements are provided in order to enable direct listing on the SGX Mainboard, such as:
Compliance with relevant laws and regulations in China as well as regulatory standards of Singapore and SGX.
Issuers will be provided with an eligibility-to-list, which will subject the issuer to administrative licensing approval and a satisfactory review.
Auditing of financial statements made by applicants and auditing needs to be conducted by certified public accountants in accordance with Singapore Standards on Auditing, the US’ Generally Accepted Auditing Standards or International Standards on Auditing.
Issuers are required to file applications with the CSRC and SGX.
Application reviews will be conducted by the CSRC.
Key Trends
Implementation of a series of initiatives to aid public listing; sector looking to improve post-pandemic
In September 2021, the government of Singapore introduced a series of initiatives in order to assist with stock market growth and the listing of companies within the city-state. The government enabled a co-investment with a state investment firm, named Temasek, to raise capital via public listings. Starting with a first tranche of SGD 1.5 billion, the initiatives enabled were as follows:
An increase in grants by the Monetary Authority of Singapore (MAS) to assist companies with the cost of listings.
Establishment of a new fund by the Economic Development Board (EDB) of Singapore to aid later-stage companies in obtaining listings within the city-state.
Assistance provided by SGX to raise funds for high-growth companies to obtain public listings.
Measures such as these taken by the government are in the hopes of improving the public equity market and encouraging more companies in seeking public listing opportunities. SGX has also implemented opportunities to boost IPOs by allowing the listing of special purpose acquisition companies.
During the first half of 2021, Singapore only attracted three IPOs, which raised SGD 200 million, whereas competitor and fellow financial hub Hong Kong had 46 listings and raised a total of SGD 27.4 billion. Therefore, SGX has taken measures to revive the IPO market and attract more public listings.
Sanctions imposed on Russia by Singapore; companies and trusts listed on SGX asked to suspend trading with Russia
On 7 March 2022, SGX stated that an immediate assessment be carried out on the financial and operational impact of the sanctions being imposed on Russia. Following Russia’s invasion of Ukraine, companies and trusts that were engaged in sanctioned business dealings with Russia were asked to suspend all trading of listed securities until proven that sanctions were no longer applied to the businesses being carried out.
Issuers were asked to submit remediation proposals within six months from the date that SGX approves of. Monthly updates on the remediation proposals have to be provided or removal from the SGX Official List would be inevitable. Singapore’s instant beverage maker Food Empire, a listed company, was temporarily closed due to its factory in Ukraine being suspended as it faced large disruptions to its supply chain, damages to public infrastructure and the displacement of civilians. Other Singapore listed issuers with businesses in Russia are also facing similar obstacles.
US-listed Chinese issuers seek company listings in Singapore; alternative venues sought due to greater regulatory and delisting risks in the United States
Due to the existence of a global valuation slump, the Chinese issuers that are already trading with American depository receipts have begun to seek listings in Singapore. This is due to the neutral jurisdiction seen in Singapore and because the existence of a secondary listing proves a benefit to Chinese companies in terms of acting as a natural hedge. In 2014, the regulatory framework allowed companies that originally had a primary listing on the Main Board to allow zero regulatory requirements to be added to the secondary listed company.
High inflation and rising interest rates worldwide have resulted in the disruption of listing plans by many companies. As of 2022, more than 11 China-domiciled firms contain listings in Singapore and the United States, and data shows that Singapore has reported a haul of SGD 385 million and zero IPOs.
Key Statistics
- Singapore's market capitalization of listed domestic companies in 2020 was reported as USD 652,614,660,000 taken from data obtained in 2022.
- Singapore offers a listing of 673 companies on SGX.
Top Singapore Publicly-Listed Companies
DBS BANK LTD.
Repeated as per client
OVERSEA-CHINESE BANKING CORPORATION LIMITED
Repeated as per client
PARKWAY PANTAI LIMITED
Repeated as per client
UNITED OVERSEAS BANK LIMITED
Repeated as per client
SINGAPORE TELECOMMUNICATIONS LIMITED
Repeated as per client
SRI TRANG INTERNATIONAL PTE. LTD.
Sri Trang International is the distribution arm of the Sri Trang Group, which is headquartered in Thailand. In Singapore, Sri Trang International is a purchasing hub for key users of natural rubber. This publicly-listed company has actively participated in the distribution of natural rubber products to the global market since its incorporation in April 2002. The firm offers a complete range of products that includes Technically Specified Rubber (TSR), Ribbed Smoked Sheets (RSS) and Concentrated Latex. Additionally, Sri Trang International provides engineering and transportation services in Singapore.
PRUDENTIAL ASSURANCE COMPANY SINGAPORE (PTE) LIMITED
Repeated as per client
WILMAR INTERNATIONAL LIMITED
Repeated as per client
CAPITALAND PTE. LTD.
Repeated as per client
SHANGRI-LA HOTEL LIMITED
Repeated as per client