IPO parade ploughs on despite volatility
FSS: Momentum from 'freshness'
A series of IPO launches is expected to continue unabated next year regardless of economic conditions or stock market fluctuations as there is still a need to raise funds through capital market mechanisms, says Finansia Syrus Securities (FSS).
"I expect businesses will have momentum next year. Although the Stock Exchange of Thailand [SET] index has not been bullish this year and there have been many issues related to external and domestic economies, many IPOs have been launched this year," said Somphop Keerasuntonpong, FSS' president.
There have been three IPOs this year from REIT and infrastructure funds, with 11 IPOs launched on the SET, including Asset World Corp, a hospitality and property firm helmed by Thai billionaire Charoen Sirivadhanabhakdi. There have been 15 IPOs launched on the Market for Alternative Investment index.
Mr Somphop said the overall returns generated from investment in IPO shares this year remains higher than last year, though huge profits may not be seen.
"The charm of IPOs is freshness. There is plenty of IPO supply, which makes investors more selective with their investments based on industry outlook, growth and suitable pricing," he said.
There are still several IPOs scheduled to launch next year and some have already received approval from the Securities and Exchange Commission (SEC).
As of Monday, five companies were approved for IPO listing on the SET index. These comprise Bangkok Aviation Center, Bangkok Commercial Asset Management (BAM), Successmore Being, Starflex and Siam Rajathani.
On Monday, BAM, the country's largest non-performing loan and non-performing asset management company, decided on an IPO price of 17.50 baht per share, with a par value of five baht per share, following interest from retail and institutional investors for IPO shares of 1.765 billion shares. First-day trade for BAM shares is scheduled for Dec 16.
Central Retail Corporation, a holding company investing in multi-format and multi-category retail goods and services, is among companies awaiting the SEC's approval. The company submitted an IPO filing in November for total share offerings of up to 2.23 billion shares.