IFBH and Mirxes chose Hong Kong over Singapore for IPOs, highlighting the valuation and liquidity strengths of the Hong Kong stock exchange over the Singapore Exchange (SGX)
Hong Kong IPO market outpaces Singapore in valuation and liquiditySingapore faces increasing challenges in attracting initial public offerings (IPOs), as more companies choose Hong Kong for its market depth and valuation potential. IFBH, a Singapore-incorporated Thai company and the world鈥檚 second-largest coconut water bottler, recently launched a HK$1.16 billion (US$147 million) IPO on the Hong Kong stock exchange. The company initially planned to list in Singapore but shifted to Hong Kong, citing strong connections to mainland China, its key market.The IFBH listing follows the successful debut of Mirxes, a Singapore-based biotechnology firm that raised HK$1.09 billion in its May IPO, with its share price rising 28.8 per cent on the first day. Both companies underscore Hong Kong鈥檚 IPO market advantage.Also read: FWD Group launches US$512 million Hong Kong IPO, targeting HK$48.3 billion valuationAccording to the London Stock Exchange Group, Hong Kong raised US$13.2 billion from 38 IPOs this year, compared with a single US$4.5 million listing on the Singapore Exchange (SGX). In 2023, Hong Kong saw 67 IPOs raising US$11.3 billion, while Singapore posted four listings totaling US$34.2 million.Singapore implements reforms to attract IPOsDespite these trends, analysts and officials indicate that Singapore is taking active steps to boost its IPO market appeal. The Singapore government recently introduced multiple incentives, including a 20 per cent tax break and incentives for funds to invest in local equities.鈥淭hat was a good shot in the arm to provide added confidence for issuers to consider Singapore,鈥 said Anuruk Karoonyavanich, global head of equity capital markets at DBS.Live EventsLiquidity remains a significant constraint for SGX. Singapore鈥檚 market capitalization is approximately US$488 billion, with a daily trading volume near US$1.1 billion, compared with Hong Kong鈥檚 US$6.5 trillion market capitalization and US$30 billion daily volume.Also read: Hong Kong鈥檚 sixfold jump in share sales drives boom year in Asia鈥淚f you look at Singapore-listed companies, over 60 or 70 per cent are controlled by Temasek or GIC,鈥 said Frank Bi, head of corporate transactions at Ashurst in Hong Kong. This level of state involvement may discourage a market-driven IPO environment.Opportunities for growth in Singapore鈥檚 IPO pipelineDespite current disparities, analysts see potential for SGX. Mirxes is planning a dual listing on SGX鈥檚 main board. China Medical System, listed in Hong Kong, also announced plans for a secondary listing on SGX.Japanese telecom operator Nippon Telegraph and Telephone recently filed to list a data center REIT on SGX, potentially raising US$1 billion, the largest listing on the exchange in four years.Karoonyavanich emphasized that companies with regional strategies, particularly those focused on Southeast Asia, are likely to consider Singapore as a viable listing venue. He pointed to increasing capital inflows from family offices and high-net-worth individuals as a potential driver of market growth.Morgan Stanley projected Singapore鈥檚 market capitalization could double by 2030, driven by increased returns on equity, a strong tech startup ecosystem, and proactive government reforms.Also read: China fashion retailer Shein to file confidentially for Hong Kong IPO in rare move, sources say鈥淭he trend is that everybody wants to raise international capital and grow regionally,鈥 Karoonyavanich said. In that context, both Hong Kong and Singapore are positioned to benefit within the Asia-Pacific region.(You can now subscribe to our Economic Times WhatsApp channel)
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(You can now subscribe to our Economic Times WhatsApp channel)Read More News onHong Kong IPO marketinitial public offerings (IPOs)Singapore stock exchangeSGX reformsmarket capitalizationNippon Telegraph and Telephone SGX listinggic(Catch all the Business News, Breaking News, Budget 2025 Events and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online….moreless