Singapore’s stock market continues to shrink

New rules were introduced by the Singapore Exchange in the previous year which gave allowance for groups to list with dual-class shares; a funding structure favored by tech firms in an effort to make it a more attractive destination. It has also tapped into agreements with Tel Aviv Stock& America’s Nasdaq the Exchange to pursue side by side or secondary listings which can help fast-growing businesses expand worldwide.
This year, more measures came, with Singapore Exchange offering an S$75 million which is equivalent to US$55 million grant to support & help young businesses cover the costs of listing, while Muthukrishnan Ramaswami, its longtime president, stated that he would step down by the end of this year after a restructuring to pursue growth. The exchange stated that all of these efforts have accelerated interest in Singapore as a fundraising hub.
However, the steps so far have failed to turn the tide. The stock market of Singapore continues to contract, and observers are unclear whether the exchange can serve the fastest-growing firms of the region.
Singapore Exchange has seen the total number of firms listed on its exchange decline by 28 in the past 5 years to 30th June, according to the exchange. There has been continuity in the trend in the first half of this year, with an overall loss of three firms, in spite of south-east Asia’s tech boom gathering pace.
Director of Capital markets at Fidelity International in Singapore, Leng Ng stated that it is a function of low valuation & liquidity”, as well as, plentiful capital in the world of private equity. New issuers would tend to gravitate towards larger & deeper markets where they believe they can raise the best valuation.
Net loss of Singapore in the listings since the end of last year compares with a net gain of 67 firms in Hong Kong, its main opponent in the region over the same period.

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