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A Look At The IPOs of 2013

invest-in-ipo logoYear 2013 has been a lackluster one for the Singapore stock market as the Strait Times Index (SGX: ^STI) closed down 1.07% for the entire year. Nevertheless, the local IPO market is still bustled with activity where a total of 26 IPOs have debuted on both the Mainboard as well as Catalist stock exchanges.

Let’s look at how they’ve performed and dig deeper to see if there are any trends to be ascertained as well. The two tables below show that as of 31 Dec 2013, there is almost an equal distribution of companies listing on either the SGX mainboard and Catalist exchanges. The IPOs are ranked based on their performance – which is the percentage gain/loss since their IPO launch dates.

SGX Main Board

IPOs 2013 table 1
*Yangzijiang RMB D and Tosei 100 are removed from the tables above.

SGX has been a strong magnet for REITs and Business Trust listings in the region as half of the IPOs make up the 14 IPOs floated on the SGX Mainboard. Croesus Retail Trust (SGX:S6NU), SPH REIT (SGX: SK6U) and OUE Hospitality Trust (SGX: SK7) are just some of the examples with relatively high dividend yields. However, many income investors would have been disappointed with their performance as all of them have fallen below their IPO prices with the exception of SPH REIT, which managed to achieve a gain of 8.89%.

Only 5 counters out of 14 mainboard IPO companies managed to eke out positive gains since their IPO launches. The top 3 performers are Overseas Education (SGX: RQ1), Linc Energy (SGX: TI6) and KrisEnergy (SGX: SK3).

Catalist

IPOs 2013 table 2

The Catalist continues to be an attractive alternative for smaller companies with short track records as there isn’t a quantitative entry criteria requirement. Instead, sponsors decide if the listing applicant is suitable to be listed.

There seems to be a variety of companies listed on Catalist exchange ranging from a mineral resources companies such as AsiaPhos (SGX: 5WV) to building maintenance firms such as ISOTeam (SGX: 5WF). These small cap companies performed better than the Mainboard as 7 out of 12 Catalist IPOs stayed above water. The returns of the top three Catalist IPOs also beat those from the SGX Mainboard.

Conclusion

It is not a big surprise that the Catalist listings outperformed the Mainboard listings. Catalist listings tend to offer a smaller public tranche and have a tendency to be over-subscribed, thus causing their share price to rise quicker. It is also noteworthy to see that three energy companies; Linc Energy, Kris Energy and Rex International out-performed the REITs and business trusts. 2013 was a year of ups and downs, and time will tell as to how 2014 will shape up.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor James Yeo doesn’t own shares in any companies mentioned.