Friday, 7 July 2017

(The Star) Bursa CEO expects more companies to seek listing this year

KUALA LUMPUR: The market for new initial public offerings (IPOs) on the local bourse is picking up, helped by improved investor sentiment and the prospect of faster economic growth this year.

Bursa Malaysia Bhd, the exchange operator, expected the number and size of new listings in 2017 to be higher compared with last year.

“This year we are seeing a lot more IPOs coming up, with the big ones already in place: as you know Lotte Chemical Titan is about to list while Edra Energy is most probably coming in,” chief executive officer Datuk Seri Tajuddin Atan said.

“I am quite positive and excited to see the number of IPOs coming in. Not only from the IPO side but also secondary listings.

“This year’s numbers will definitely be much better than last year’s,” he told reporters at the KenTrade trading challenge event here yesterday.

Tajuddin also said growth would be spurred by the stronger economic sentiment coupled with the strong fundamentals of the country.

“You see the gross domestic product (GDP) as has been announced by Bank Negara is a lot better, while earnings are better as well.

“Most importantly the confidence is coming back to the country.

“The KL composite index and the ringgit are also performing well,” he said.

Malaysia recorded a 5.6% GDP growth in the first quarter of this year, buoyed by surging demand from overseas for electronic components used to make smartphones and other gadgets.

StarBiz reported a few days ago that economists in the private sector have also started upgrading their growth predictions for Malaysia, with many expecting the pace of the country’s economic expansion this year to exceed the Government’s forecast, backed by strong foreign demand and solid domestic demand.

Tajuddin said there was pent-up demand for listings this year because companies that wanted to list earlier have decided to go public this year.

“Companies which delayed their IPO last year are coming back this year and there are new ones as well. (Investing) sentiment is also good while perception is great as well.

“When sentiment is good, performance will also improve,” Tajuddin said.

He also noted that the number of foreign investors that have entered the local market was at its highest compared with recent years.

“The first half numbers are looking good but I will not preempt this as we will announce it in Bursa’s first half briefing,” he said.