In recent years, secondary listings on the Singapore Exchange (SGX) have mostly struggled to gain meaningful traction with investors. Instead of raising their profile and whetting investors’ appetite, their performance on SGX has raised the question of why they even bothered to list here at all.
Unlike an initial public offering (IPO), a secondary listing involves a company listed on a stock exchange making its shares available for trading in another market. Singapore is home to 29 such listings, all on the Mainboard, of which nine hail from Hong Kong, more than any other exchange.
Of the remaining 20, five hail from the London Stock Exchange, four each are from the Tokyo Stock Exchange and Bursa Malaysia, two each from the New York Stock Exchange (NYSE) and the Stock Exchange of Thailand, and one apiece from the Australian Securities Exchange, the SIX Swiss Exchange and the Philippine Stock Exchange.
Nine of the 29 secondary listings landed on SGX after the turn of this decade. All nine listed in Singapore by way of introduction, meaning the companies did not sell any new or vendor shares.
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This story takes a look at these nine stocks to find out whether Singapore’s renewed push in recent years to attract international names has done anything beyond adding tickers to a market that, after years of deep slumber, finally started to stir only a few months ago.
If indeed these cross-border listings are struggling to gain traction here, should SGX continue to court more of such companies? What does this imply for the local IPO market? Is there still an appetite for primary listings on SGX?
Among the weakest links
The first secondary listing on SGX since the start of this decade is AMTD Idea, a diversified business group with interests in financial services and investments, digital solutions, and hospitality real estate. Shares of AMTD Idea started trading on SGX in April 2020, eight months after their primary listing on NYSE.
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The stock opened at $13.95 on its first day of trading in Singapore. It went on to hit a high of nearly $18 a few months later, before descending over the years to $3.60, where it has been holding for about a year now.
That is a 74% decline from its trading debut’s opening price, making it one of the worst performers among companies that launched a secondary listing on SGX in the past five years.
AMTD Idea’s share price on NYSE has seen much bigger swings and losses. From its IPO price of US$8.38, the stock soared above US$60 within days of its trading debut on Aug 5, 2019. It’s hovering around US$1 these days.
Wild as that was, it was nothing compared to how the shares of AMTD Idea’s digital services arm fared in their early days on NYSE. Paris-headquartered AMTD Digital made its debut on NYSE in July 2022. From its IPO price of US$7.80, the counter rocketed to US$2,555 barely a month later, giving the company a market cap of more than US$300 billion. It did not take long for it to be dubbed a meme stock.
Shares of AMTD Digital, which is 51.6% owned by AMTD Idea, were quickly sold down in the weeks after their meteoric rise. The stock has never rebounded ever since. Its current 50-day moving average is about US$1.94 while its market cap is less than US$600 million.
AMTD Idea was founded by Calvin Choi, an auditor-turned-investment banker who used to work at PwC, Citigroup and UBS. The company’s largest shareholder is AMTD Group, a privately held financial services outfit founded in 2003 by the Commonwealth Bank of Australia and Hong Kong billionaire Li Ka-shing’s CK Group but now controlled by Choi, a Hong Kong citizen.
In seeking to reassure investors of his commitment to the companies, Choi placed upon himself a moratorium to not sell his AMTD Idea and AMTD Digital shares in the open market for five years until Oct 23, 2028.
Latest dual listing
The latest secondary listing on SGX is China Medical System Holding, a Hong Kong-listed pharmaceutical company founded in 1992 in Shenzhen.
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Shares of China Medical System opened on SGX at $2.05 on July 15 this year. The stock, which is traded in board lot sizes of 100 shares, went on to hit an intraday high of $2.32 before closing the session at $2.28. It has since succumbed to some profit-taking.
From lab bench to market launch, the company covers every stage of the drug development journey. It has been paying out 40% of its earnings as dividends since its listing in Hong Kong in 2010.
Before China Medical System, Hong Kong-listed PC Partner Group was the most recent dual listing on SGX. PC Partner makes video graphics cards and provides electronic manufacturing services to major brands worldwide.
Shares of PC Partner opened at 85 cents on their first day of trading in Singapore last November. They rose above $2 in March this year but have since pared much of those gains.
Still, the stock continues to hold above its trading debut’s opening price and is up by more than 50% so far this year. This makes it the best performer among the nine companies that made SGX their secondary market from 2020.
PC Partner’s longstanding business ties with Nvidia, the Silicon Valley titan fuelling the world’s AI ambitions, could explain why investors seem more enamoured with its stock than most other recent secondary listings on SGX.
Nvidia supplies over two-thirds of the computer chips that PC Partner uses to produce branded graphics cards sold worldwide. With global demand for Nvidia’s chips going strong, PC Partner is seen as a beneficiary, especially in the graphics card market.
That said, tariffs and trade restrictions by the US against China could be a dampener. The US has blocked some of Nvidia’s chip exports to China as part of efforts to stop Beijing from advancing its military and AI capabilities.
This poses risks for PC Partner, which relies heavily on Nvidia’s chips and produces most of its graphics cards in Dongguan, a major manufacturing hub in China and one of the country’s key export centres.
Sales to some of PC Partner’s export markets have already been affected by these curbs. Sales in China, one of PC Partner’s key revenue contributors, could also take a hit if restrictions are widened to cover more consumer-grade graphics cards.
While PC Partner has begun shifting some production to Indonesia to hedge against these risks, escalating tensions between the US and China could still squeeze margins and slow deliveries.
In line with its intention to diversify beyond Greater China, PC Partner relocated its global headquarters to Singapore last year from Hong Kong, where it has been operating for decades since its inception in 1997. It’s in the process of delisting from the Hong Kong stock exchange. SGX will be its primary market once that’s completed.
A mixed bag for the rest
Of the remaining six secondary listings that made their debut on SGX in recent years, investor interest has been lukewarm at best. A few are holding above their opening price on Day 1 of their listing, while the rest remain underwater. Most are thinly traded.
Those still above water are Helens International, which runs one of the largest networks of pubs in China, and TSH Resources, a producer of crude palm oil and palm kernels with plantations in Malaysia and Indonesia. Between these two, Helens has risen more from the time of their debut till now.
Helens made its market entry on SGX in July last year, opening at 36.5 cents. It fell to a low of 22.5 cents two months later but rebounded shortly afterwards, reaching a 52-week high of 66 cents. While it has come off that peak, it is up by over 10% this year and is more than 30% higher than the closing price on its debut.
Shares of Helens in Singapore have even outperformed their primary listing in Hong Kong, where they are down by over 40% year to date. The stock in Hong Kong now trades at just a fraction of Helens’ IPO price of HK$19.77 ($3.25).
Bursa-listed TSH Resources started trading on SGX in September 2023. The stock in Singapore is down nearly 10% so far this year but has gained slightly more than that from its Day 1 opening price. Its shares in Malaysia are also down by nearly the same magnitude year to date, but have more than doubled since they started trading in 1994.
The other secondary listings that made their debut on SGX after the turn of this decade — Comba Telecom Systems, Emperador, Nio and Sri Trang Gloves (Thailand) — are all trading way below their respective Day 1 opening prices.
Not letting up on secondary listings
Despite how most of the secondary listings in recent years have fared, Singapore is not relenting on efforts to attract more companies trading on other exchanges to also list here.
The Monetary Authority of Singapore (MAS) sought public feedback in May to simplify the process for secondary listings on SGX. In essence, it wants to make it easier for overseas-listed companies to also list here and sell shares to retail investors by letting them reuse their existing prospectus with only minor changes.
This will ease the burden for such companies, which currently have to meet the same strict prospectus rules as those pursuing an IPO if they wish to pursue a secondary listing and issue new shares on SGX.
Among other measures to attract more secondary listings, MAS will also offer a 10% corporate income tax rebate for overseas-listed companies that wish to go public and sell shares in Singapore.
While these measures are relevant, Singapore faces an uphill task in piquing the interest of primary issuers contemplating a secondary listing. Notably, trading liquidity in the local stock market remains stubbornly dismal, making it tough to raise meaningful capital.
Even if a primary issuer on another exchange wants to dual-list but has no immediate plans to raise funds, Singapore may not rank high on its list, as there is no shortage of markets in the region to choose from.
Hong Kong proudly welcomed Contemporary Amperex Technology (CATL) to its stock exchange in May, helping the maker of batteries for electric vehicles pull off the world’s biggest IPO so far this year. Besides China, where Shenzhen-listed CATL is based, Hong Kong is also courting listed companies from Southeast Asia and the Middle East to float on its bourse.
Malaysia, too, is becoming part of the conversation for companies contemplating a secondary listing. Hong Kong-listed Unity Group, which sells energy-saving solutions, has unveiled plans to dual-list in Malaysia, one of its key revenue markets. Several Singapore-listed companies, including Oiltek International, Q&M Dental Group and UMS Integration, have also announced similar plans.
Other Asian markets, including Thailand and Indonesia, are also following suit, aiming to attract international listed companies that are eyeing a wider investor reach and greater capital access.
Against this backdrop, what are Singapore’s chances?
Dilemma for SGX
For a start, the patchy performance of the eight companies that pursued a secondary listing on SGX over the past five years stems from multiple factors, according to issue managers The Edge Singapore spoke to.
These include limited investor awareness of their business, industry-specific headwinds and issues unique to some of these companies. Nio, for example, is still struggling to turn the corner amid brutal competition among electric-car makers, especially those from China. Shares of Nio have tumbled more than 70% since their SGX debut in May 2022.
Risk aversion in the Singapore market is another reason some of these stocks have not found much favour with investors, many of whom still prefer dividend stocks and real estate investment trusts.
A much easier way for SGX to create new listings is through a secondary listing of listed companies from other exchanges, says Mark Liew of PrimePartners Corporate Finance / Photo: Albert Chua
“I know of so many high-net-worth individuals who happily trade US, Hong Kong and China stocks. But for Singapore, they want safety,” says Mark Liew, CEO of PrimePartners Corporate Finance, the issue manager for AMTD Idea and TSH Resources’ Singapore listings.
“(These individuals) see their Singapore portfolio as a hedge, giving them good income. If everything elsewhere is too volatile, they come back to Singapore. In that sense, the volatility and trading are not there in Singapore.”
This is why businesses that are not tried and tested or lack an established track record are not likely to take off on SGX, even if they are already listed on another exchange, says Liew. “The business models of new-economy or creator-economy companies are less familiar to Singapore-based investors and can be harder to understand.”
Does it make sense then for SGX to continue chasing secondary listings? Or are such listings the solution to Singapore’s IPO drought?
“I think SGX is taking a two-pronged approach — trying to attract more secondary listings and IPOs at the same time,” says Liew. “A much easier way to create new listings is through a secondary listing of listed companies from other exchanges.”
He believes Chinese companies listed on NYSE or Nasdaq may view SGX as a viable secondary market if growing tensions between the US and China hinder their business or their ability to raise capital from US investors. Some may also consider SGX a hedge against the risk of losing their primary listing if Sino-US ties deteriorate further.
There is a catch, though. “For most listed companies with two or more listings, most of the trading or liquidity usually continues to be on their primary exchange,” he concedes.
One way to help generate greater interest in these companies is for them to beef up investor education after they list here, including getting research coverage. The nine secondary listings mentioned in this story have largely flown under the radar of analysts in Singapore.
“We rarely cover secondary listings because of the lower (trading) volumes. In addition, analysts on the primary exchange tend to have better management access and industry knowledge, leaving us disadvantaged,” says Paul Chew, head of research at Phillip Securities Singapore.
Meanwhile, fund managers and other institutional investors in Singapore should take a more constructive approach toward promising companies considering a listing on SGX, according to Jason Saw, head of investment banking at CGS International Securities, the issue manager and underwriter for the dual listing of Helens and China Medical System. All too often, he says, those from the buy-side tend to demand overly-discounted valuations, which risk driving quality issuers to other exchanges.
“One of the challenges we often hear from the buy-side is, ‘This company is worth only, say, 10 times earnings’. Yet the same company goes to Hong Kong and commands a 30 times valuation. Why is that? It’s the same company, after all.
“Ultimately, that’s a function of the market, not the business itself. Singapore investors are not used to paying a premium for growth. We need a mindset shift if we want quality listings to come to Singapore.”
If IPOs remain elusive, bringing in more secondary listings may be the way to go for Singapore’s stock market, which is facing a spate of privatisations, Saw says. “In today’s environment, smaller companies actually don’t need to list because there’s so much private capital out there.”
Listed Chinese companies on the hunt for more consumer markets, especially in Southeast Asia, may find SGX compelling, according to Saw. “Post-Liberation Day, companies in China are looking to expand elsewhere. They need new export markets and access to consumers,” he says, referencing President Donald Trump’s aggressive tariff campaign aimed at reshaping America’s trade ties with China and other countries.
China Medical System seems to fit the bill. It said being listed on SGX will deepen its presence in Southeast Asia and enable it to tap what it calls a “new and sophisticated investor base” in Singapore.
Singapore investors are not used to paying a premium for growth. A mindset shift if needed, says Jason Saw of CGS International / Photo: Albert Chua
Closing bell reflections
Singapore’s courtship of secondary listings was never meant to be a silver bullet. But if the aim was to add dynamism, improve liquidity and elevate SGX’s global standing, the results so far suggest the strategy has fallen short.
The problem is not necessarily with the companies, many of which are profitable and regionally relevant, with some even well-known in their home markets. The disconnect lies in the lack of investor awareness and a local investment community that still prizes safety and yield over growth and risk.
Until these deeper market dynamics shift, even the most promising cross-border listings may find Singapore a tough crowd. If the goal is to attract global names, Singapore must offer more than regulatory ease. More engaged investors, active analysts and a willingness to pay for growth are also important. Otherwise, it risks becoming a quiet side stage for companies whose main act lies elsewhere.
