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The Week in Numbers: Thailand Set to Become Hottest IPO Market in South-East Asia

Thailand is set to raise more than US$5 billion from initial public offerings (IPOs) in the second half of 2019. South-East Asia’s second-largest economy could see its largest IPO haul in six years, despite the economic jitters due to the inconclusive election results earlier this year.

Tourism has been a key driver of growth for the Thai economy, with the country expecting a 7.5% increase in visitor arrivals this year. Thailand’s finance minister said that the country will introduce 20 billion baht (S$848.04 million) worth of economic measures to boost the consumption, tourism and help lower income earners.

In 2018, Thailand’s IPO market raised US$2.5 billion compared to US$3.8 billion in 2017. Among the big names expected to list in Thailand this year are state-owned oil company PTT Pcl, the hospitality business of tycoon Charoen Sirivadhanabhakdi empire, and a unit of Thailand’s largest retailer Central Group.

South Korea’s economy surprised analysts as it shrank in the first quarter of the year, its worse performance since the global financial crisis some 10 years ago. Gross domestic product declined by a seasonally adjusted 0.3% from the previous quarter, the worst contraction since a 3.3% fall in late 2008.

The data comes a day after the South Korean government disclosed a 6.7 trillion won (S$7.9 billion) supplementary budget to tackle air pollution and weak exports. Capital investment plunged 10.8%, the worst decline in 20 years.

Facebook beat Wall Street earnings estimates in the first quarter of the year. The company set aside US$3 billion to cover anticipated costs associated with the settlement regarding the sharing of data other disputes that the firm violated. Excluding this, Facebook would have earned US$1.89 per share, up from US$1.69 per share a year ago and beating analysts estimate of US$1.63 per share. Total first-quarter revenue rose 26% to US$15.1 billion from US$12.0 billion last year.

Back home, ARA Group is spinning off a raft of American hotels under the Hyatt brand into a business trust that it wants to list in Singapore. If successful, it would be the first hospitality trust focused purely on the United States market and the first counter on the mainboard since Koufu Group Ltd (SGX: VL6) went public in July last year.

The ARA US Hospitality Trust will have an initial portfolio of 38 hotels, comprising 27 Hyatt Place Select-service outlets and 11 Hyatt House extended-stay inns with an appraised book value of US$719.5 million (S$978 million). Net property income is projected at US$42.3 million and distributable income at US26.1 million for the eight months from May 1 to December 31 this year. The prospectus said that the trust is expected to have an aggregate gearing of 33.4% and borrowings of US$251.8 million at the date of listing.

Meanwhile, industrial rent in Singapore remained stable in the first quarter of 2019. The price index was down 0.1%, while the rental index was flat. The occupancy rate was flat from the previous quarter but rose 0.3 percentage points to 89.3% from a year ago.

For the rest of 2019, another 1.2 million square meters of industrial space is estimated to come on stream. This compares with the average annual supply and demand for industrial space in the past three years of 1.4 million and 1.1 million square meters respectively.

Finally, a paper tycoon and his wife have reportedly made the biggest luxury property purchase in Hong Kong this year for HK$1.45 billion (US$180 million). The seller of the nine-apartment complex in Repulse Bay was American International Assurance Co, which allegedly paid HK$20.2 million in 1985. The deal comes amid a rebound in Hong Kong property prices, which have climbed for 10 straight weeks.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore recommends Facebook Inc. Motley Fool Singapore contributor Jeremy Chia owns shares of Facebook Inc.