This year's IPO offerings continue to ride a bullish wave, with the year-end spotlight on Do Day Dream Plc (DDD), the maker and distributor of Snail White skincare products, as the last IPO listed on the Stock Exchange of Thailand (SET) in 2017.
DDD shares yesterday closed on their first day of trade on a high of 85 baht, up 32 baht, in trade volume worth 5.8 billion baht.
This registered a 60.1% gain on the IPO price of 53 baht.
There have been 44 new listings this year, including 22 deals listed on the SET, 16 deals listed on the Market for Alternative Investment (MAI) index, five real estate investment trusts (REIT) and one infrastructure fund. These exclude merger and acquisitions and reverse takeover deals.
Total market capitalisation for this year's IPOs reached an all-time high of 420 billion baht as the SET celebrated its 42nd anniversary.
The growth of IPO deals resulted from the SET's effort to educate provincial companies on the costs and benefits of being listed by partnering with law firms, accounting firms, and financial advisers over the past 3-4 years, said SET executive vice-president Amnouy Jiramahapoka.
Of the 38 IPOs, 37 launched their first trading day on either the SET and MAI, with Sunsweet Plc set to be this year's last IPO launched on the MAI, due to commence trade this Thursday.
Only two stocks, Information and Communication Networks Plc (ICN) and Humanica Plc (HUMAN), have exceeded a 100% return on IPO price on the first day of trade.
ICN shares gained 151.09% on the MAI, while HUMAN shares gained 101.25% on the SET.
Excluding ICN and HUMAN, 22 of the IPOs saw more than a 10% capital gain, six rose less than 10%, and six recorded capital losses.
Returns on IPOs are based on a calculation of IPO stock purchases on the first trading day.
SET senior executive vice-president Santi Kiranand said the IPO momentum is expected to continue into next year, resulting from provincial educational efforts and the IPO programme arranged for chief financial officers, company founders, law firms, and provincial chambers of commerce.
Even though the number of IPOs in 2017 is slightly short of the 46 IPOs recorded in 2014, the market capitalisation of Gulf Energy Development Plc reached an all-time high of 96 billion baht, higher than the previous record held by PTT Plc.
TPI Polene Plc had the second-largest IPO market capitalisation this year at 58.8 billion baht, followed by TOA Paint Thailand Plc (48.7 billion), B.Grimm Power Plc (40.7 billion), and Thonburi Healthcare Group Plc (32.3 billion), according to SET data.
"The combined market capitalisation of the largest five IPOs exceeded our annual target and most of them are companies in the energy sector," Mr Santi said.
This year, the SET targeted a total combined market capitalisation of 280 billion baht for IPOs, excluding secondary offerings.
Another interesting investment development was seen in foreign listings and REITs that invested in foreign assets. Examples include SET-listed Ingress Industrial Thailand, a Malaysian auto parts manufacturer, as well as Strategic Hospitality REIT investing in Indonesian hotels.
For 2018, Mr Santi projects over 30 IPOs, including REITs and the Thailand Future Fund, will commence trading in the first quarter.
Bualuang Securities president Pichet Sithi-Amnuai said the IPO market continues to have good sentiment in 2018 as global equity markets are expected to keep rallying based on US tax reform policy, while Thailand's economic recovery supports the upbeat outlook.
IPOs are aiming to be attractive, clustering in sectors with high-growth potential and a good business outlook with an ability to increase long-term net profits, said Mr Pichet.
However, companies who plan to raise funds from the stock market have to take the time to prepare their business structures and accounting standards to meet the bourse's listing requirements, he said.
If market sentiment continues to be positive on continued global economic growth and stable domestic politics, next year's IPO market should maintain its upward trend, said Vicha Tomana, managing director at Phillip Securities Thailand.
All businesses can raise funds from the bourse, but they need to have a niche market or strengths to attract investment incentives, said Mr Vicha.
Appropriate IPO prices are also important to raise funds from the market, meaning financial advisers have to study how to set a fair price for all participating parties, he said.
"The IPO market in 2017 has been very active because of good market sentiment supported by Thailand's economic recovery, low interest rates, and the tempered nature of the domestic political climate. If next year's market sentiments remain positive, the IPO market will continue growing," said Mr Vicha.
He said companies not only raise funds from the stock market to reduce operation costs, but also because they need sustainable growth as listing will increase their credibility based on the upgrade in accounting standards, internal audit committees, as well as transparency in business structure and shareholders.