Nov 27, 2012

Singapore - More public companies in the Philippines eyeing Singapore market for funds

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SINGAPORE: More Filipino companies may be looking at the Singapore market to raise funds, with some eyeing a dual listing while others an initial public offering (IPO), say analysts.

Public companies in the Philippines that seek to list on the Singapore Exchange (SGX) usually do so to raise their profile and broaden their investor base.

Filipino food producer Alliance Select Foods International is seeking to list on Singapore's SGX-Catalist board in 2013, a move that will make it the first publicly-traded Filipino company to debut in Singapore.

Alliance Select Foods International was incorporated in 2003 and listed on the Philippines Stock Exchange in 2006, with Singapore investors forming its largest shareholders.

"Singapore is a regional hub for finance especially in ASEAN. We felt very strongly because of our strong Singapore based shareholders, we felt that it was natural for us to seek a dual listing here in Singapore," said Jonathan Dee, president and CEO of Alliance Select Foods International

"The interest rate in Singapore is (also) much lower than that of the Philippines… we chose the Catalist primarily because of our size. Our market cap today is 50 million dollars and so Catalist would fit perfectly with that," he added.

Experts also said that it was time for local investors to start looking at investment opportunities in the Philippine stock exchange, as the Filipino market gains attention in the international arena.

The Philippines' stock market is Asia's 12th largest with a market capitalisation of about US$212 billion.

"There are international investors, especially banks, which are actually overweight in the Philippines in terms of their Asia exposure, primarily because they see Philippines as a re-flation story," said Daryl Liew, head of Portfolio Management at Reyl.

"It's pretty much a domestic consumption play which is a pretty hot theme at this point in time. And actually if you look at the stock market performance, the Philippines stock market is probably the best stock market performance year to date," said Mr Liew.

"Last I checked it's up about 27 per cent, which is higher than the Thai stock market, the Indian stock market and the Hang Seng," he added.

Some public companies in the Philippines are already popular with international institutional investors.

Once the Philippines stock exchange is connected with the ASEAN trading link, analysts say these new linkages will help elevate its profile as well as increase retail investors' interest in Filipino public companies.

The ASEAN trading link comprises seven exchanges in six countries, with the Singapore Exchange and Bursa Malaysia being the first two exchanges to connect in September 2012. The stock exchange of Thailand followed suit on 15th October.

- CNA/jc

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