Competing with rival hubs such as policymakers and business leaders in Hong Kong and Singapore, we know that a vibrant market, the IPO sector, is a key factor in our new wealth.
The group exploring ways to strengthen Singapore’s combative stock market has drafted a package of measures for the stock exchange, including tax incentives that spur the list.
SGX has seen a decline to 20 years’ lows as the number of listed companies moved to markets like the US. The situation is ironic considering that Singapore’s reputation as a wealth management hub grew rapidly over the same period. In late 2024, a media report (Financial Times, others) said there were 617 listed companies, falling from the peak year of 782 in 2013.
Yesterday, the Stock Market Review Group announced that it “announced the first set of measures to strengthen Singapore’s stock market development.”
The SGX is not the only exchange that will go through difficult times. For example, on the London Stock Exchange, the list is down. According to EY in January, LSE in 2024, 88 companies registered or transferred major listings from major markets. Like Singapore’s SGX, London’s blues are affected by poor liquidity and valuation. The challenge is to stop this downward spiral. Singapore’s listing market is also the forefront of competition with rival hubs such as Hong Kong.
In the proposed relief statement, the MAS statement said, “including proposals to introduce tax incentives to encourage more listings and investments in the Singapore stock market.” The proposal was sent to the government. The proposal statement did not explain what the tax incentives were.
“With technology making global markets more accessible, listings and liquidity are drawn to several global stock exchanges, and other exchanges compete for liquidity. It makes it difficult. For example, a significant proportion of global capital is concentrated in the US public markets,” Mas said.
Media coverage noted that companies prefer to list in the US because they can get good reviews and higher liquidity. China’s fast fashion group Singh, headquartered in Singapore since 2022, is reportedly considering a listing in London. The Singaporean companies chose Grab and the Sea.
“The review group recognizes that there are no silver bullets or easy solutions to reverse these trends,” it continued.
The measures will help midsize businesses that do not have immediate access to major capital markets to make city-states available to use as “launch pads for capital raising,” the statement continued. Exchanges must include companies listed elsewhere, but they require a secondary list of Asia.
SGX CEO Loh Boon Chye reportedly told The Straits Times in the Straits of Singapore that the momentum from the companies they want to list there is improving. At the beginning of February, SGX reported a 20.7% increase in net profit from the previous year to $340 million ($252.4 million) by the end of December, up to six months.
