Thailand set to be SE Asia's hottest IPO market with $5 billion of planned second-half floats

[webfact]

Thailand set to be SE Asia's hottest IPO market with $5 billion of planned second-half floats

By Chayut Setboonsarng and Anshuman Daga

 

Tourists pose for a photo at Asiatique night market, in Bangkok, Thailand April 23, 2019. REUTERS/Soe Zeya Tun

 

BANGKOK/SINGAPORE (Reuters) - Thailand is set to see the most funds raised from IPOs in Southeast Asia this year, with more than $5 billion expected to be garnered in the second half, sources said, as a tourist boost to the economy trumps jitters stoked by inconclusive elections.

 

Southeast Asia's second largest economy is expected to see listings from the retail arm of state-owned oil company PTT Pcl, the hospitality business of tycoon Charoen Sirivadhanabhakdi's empire, and a unit of the country's largest retailer Central Group, people familiar with the matter said.

 

First-time share sales from these companies and others could make it the largest haul for the country in six years, said the sources, who were not authorised to speak to the media.

 

Investors are focusing on the country's stable economic growth and currency and do not see any big risk from political uncertainty. Preliminary election results show Pheu Thai, the leading anti-junta party, has won the most constituency seats, while the pro-army Palang Pracharat gained the most votes, but each is unable to form a government on its own.

 

Low interest rates and a hunt for high-yielding assets are driving investors to allocate money for equities, fund managers said.

 

"People are waiting and IPOs will sell," said Narongchai Akrasanee, chairman of MFC Asset Management.

 

Tourism is a strong pillar of Thailand's growth, with the country expecting visitor arrivals to rise by 7.5 percent this year. Thailand's finance minister said last week that the country will introduce economic measures worth about 20 billion baht ($624 million) to boost consumption, tourism and help low-income earners.

 

Last year, Vietnam was the biggest market for IPOs in Southeast Asia, with listings there raising $3.4 billion, according to data from Refinitiv.

Bankers say 2019 is set to be Thailand's strongest year for IPOs since 2013, when they raised over $6 billion. In 2018, Thai listings raised $2.5 billion after mopping up $3.8 billion in the previous year, Refinitiv data showed.

 

For a graphic on IPO proceeds in Singapore, Thailand, click:

 

"One positive in Thailand is that domestic investor liquidity is extremely healthy," said Ho Cheun Hon, Credit Suisse's Singapore-based head of Southeast Asia equity capital markets.

 

"Assuming the final election outcome does not impact consumer and investor sentiment negatively, we are hopeful that market conditions in the second half of the year will be constructive for the strong Thai pipeline to push through," he said.PTT Oil & Retail, which includes gas stations, coffee shops and convenience stores, is expected to kick off its IPO process after the election results and could raise about $2 billion, sources said.

 

Mall operator Central Group's retail arm is also slated for a stock market flotation later this year and could raise $1 billion-$2 billion, sources said.

Asset World Corp, the hospitality arm of TCC Group, which owns office buildings, luxury hotels and shopping arcades, plans to launch a $1 billion-$1.5 billion IPO in the second half of the year, IFR reported in January.

 

PTT, TCC and Central did not respond to Reuters requests for comment.

 

While there is short-term volatility in markets, Thailand's benchmark index is trading at close to its five-year historical PE ratio, so IPO plans should go ahead if there is more clarity in politics in the second half of 2019, said Nunmanus Piamthipmanus, SCB Asset Management's chief investment officer.

Some investors, however, cautioned that issuers had to ensure IPOs were not overpriced.

 

"Competition and supply in offices, hotels and malls make these sectors challenging," says Thidasiri Srisamith, chief investment officer at Kasikorn Asset Management.

 

(Reporting by Chayut Setboonsarng in BANGKOK and Anshuman Daga in SINGAPORE; Editing by Muralikumar Anantharaman)

 

-- © Copyright Reuters 2019-04-25

[Oziex1]

Yep, I'm planning my investment strategy on that story. 

[yellowboat]

Find little inspiration in that story.  Most Thai companies lack innovation.  Most Thai people lack freedom.  They want to get public for money.  Great!  It is still boring.

 

Asiatique is a high priced, ornate, outdoor market.  It lacks any wow factor.  JJ is more inspirational but hugely crowded. 

[nausea]

15 hours ago, yellowboat said:

Most Thai companies lack innovation. 

I agree, they're good at copying; I've yet to see anything Thai where they took something and improved it - Japan being the obvious contrast. As Picasso said - bad artists copy, good artists steal.

[Cadbury]

22 hours ago, webfact said:

Southeast Asia's second largest economy is expected to see listings from the retail arm of state-owned oil company PTT Pcl, the hospitality business of tycoon Charoen's empire, and a unit of the country's largest retailer Central Group

Looks like the greedy filthy rich 1% of the population have their sights set on lifting their world record ownership of Thailand's wealth to above 67%.

They won't be satisfied until they own 100% and the remaining 99% own nothing. The junta will be there to assist them along the way; envelopes permitting.

[Fex Bluse]

2 hours ago, nausea said:

I agree, they're good at copying; I've yet to see anything Thai where they took something and improved it - Japan being the obvious contrast. As Picasso said - bad artists copy, good artists steal.

Well, the east Asians are good at copying (and now innovating). The Thais are not even very good at copying, in my opinion. 

 

There is hardly a single thing in any industry in Thailand that is interesting or of high quality that was not heavily influenced by Western or advanced Asian countries. 

 

Well, except for the girls. The girls are pretty decent quality. 

[DLock]

PTT, Central and TCC are local entities, and purely money grabs for the families that owns them...they are hardly inspiring startups to advance Thailand's reputation in any way.

 

Weak.

[StayinThailand2much]

With the quicksilver at 37degr. C, 'hottest market' should be easy to achieve... ????