In this complete guide on initial public offerings (IPOs) for Singapore companies, we have compiled the best articles from The Motley Fool Singapore’s flagship website, www.fool.sg. These articles touch on a wide range of topics, from the basics of an IPO to whether you should dip into your savings to buy IPOs.
Without further ado, let’s dive in.
What is an IPO?
An IPO is an event where a company offers its shares to the public for the very first time.
IPOs are offered on the primary market directly to investors, and once the companies become listed, they are traded on the secondary market, which is the stock exchange.
To apply for an IPO on the primary market in Singapore, you need to have a Direct Securities Account with The Central Depository (also known as a CDP Account), and a local bank account.
More on the basics of an IPO can be found in the article below:
Reading the IPO prospectus
Just like a student’s report card, the IPO prospectus contains all the information investors should know about a company. Before investing in IPOs, you must know more about the company’s business, future growth drivers, and so on. However, many investors do not like to read an IPO prospectus as it is too voluminous (they are usually 500 pages-thick).
Therefore, to help you breeze through an IPO prospectus effectively, we have laid out the top eight things to look out for in the thick tome:
Even if you do not invest in an IPO and only invest in the company after it has gone public for some time, its IPO prospectus is still a very useful go-to guide for everything there is to know about the company. It is almost always more detailed than an annual report.
Recent IPOs in Singapore
From the start of 2018 through to 7 August 2018, there were 10 IPOs on the Singapore stock exchange. For a quick overview of the best performers in that period, jump into the article here.
Should you invest in IPOs at all?
Most of the 10 recently-listed companies mentioned above had not performed well as their stock prices on 7 August 2018 were lower than their respective IPO prices. This begs the question: Are IPOs worthy investments? The short answer is: No. For a longer read, check out the following articles:
Should you then buy a company after it goes public?
If it’s unwise to participate in an IPO, is it wise to buy a company after it has become listed? It might be, as highlighted in the article here.
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Disclosure: The Motley Fool Singapore contributor Sudhan P contributed to this article. The information provided is for general information purposes only and is not intended to be personalised investment or financial advice.