Dual listings enhance region's attraction as capital bloc

SINGAPORE: Dual listings can enhance the region's attraction as a
capital bloc to rival Hong Kong, China and India, says Frost and
Sullivan vice-president for Asia-Pacific business financial services,
Sanjay Singh.
He said these could benefit regional companies
that sought to portray a more international presence, enlarge/diversify
their investor base, gain access to additional capital as well as have
better liquidity for their shares.
"Investors will now be able
to gain access to the markets in these countries with lower transaction
costs. At the regional level, this can enhance the region's
attractiveness as a capital bloc," he told Bernama here on Friday.
Sanjay said this when asked on the benefits of the recent concurrent listings of IHH Healthcare on the Main Market of Bursa Malaysia Securities Bhd and the Main Board of Singapore Exchange Securities Trading Ltd (SGX-ST).
He
said for SGX-ST, the dual listings would provide an opportunity to
strengthen its position by attracting both global and regional
companies to list here and benefit from a more globally-oriented pool
of investors both institutional and retail.
However, Sanjay
cautioned companies seeking dual listings to be mindful of the
differences in regulations, corporate governance issues as well as the
level of disclosures needed and the additional time and investments
needed for the same.
"Companies pursuing this option would also
need to ensure that they secure cornerstone investors to ensure that
the listing is successful.
"In some instances, it may also
require the company to have two legal entities listed on the two
separate stock exchanges but carrying on business as one economic
entity.
"This may prove to be quite cumbersome from an
operational and regulatory perspective. So one needs to carefully
evaluate the pros and cons of the dual listings," he said.
He
said the establishment of the Asean trading link initially between
Singapore and Malaysia followed by Thailand was also expected to
provide a stimulus from a retail investor standpoint. - Bernama