SGX expects Indian biggies to launch mega issues in Singapore

Singapore Exchange, operator of the city's securities and derivatives markets, expects Indian companies to make up some of its biggest share sales this year following a tie-up with the Bombay Stock Exchange.

The Singapore bourse is likely to draw Indian companies with more than S$1 billion ($700 million) in market capitalization to sell shares, said Seck Wai Kwong, Singapore Exchange's chief financial officer.

Last year, only two of 73 companies that sold shares in Singapore had market values exceeding S$1 billion, data compiled by Bloomberg show.

"We are seeing good interest,'' Seck said in an interview late yesterday. "Our strategy is to aim for the larger companies. India will be a significant source of listings.''

Singapore Exchange needs to attract larger foreign companies to sustain its standing as Southeast Asia's biggest bourse. The exchange expects more than half of its publicly traded companies to come from overseas in 2012, from 36 per cent now, Seck said.

The exchange is collaborating with foreign bourses to increase revenue from overseas. It bought a 5 per cent stake in Bombay Stock Exchange last year and sold 4.99 per cent of itself to Tokyo Stock Exchange.

Mercator Lines (Singapore), a unit of an Indian shipping company, and Ascendas India Trust, which invests in office and industrial properties, are among the India-related stocks that went public in Singapore last year.

Singapore "has a transparent regulatory environment and the overall processing time is faster than other regional exchanges,'' said Thilan Wickramasinghe, an analyst with CLSA Asia Pacific in Singapore.

"You will have competition from other regional exchanges, but you get better valuations. So, I don't think that position can be that easily eroded.''

The Singapore exchange, with other Asian exchanges, fell on Wednesday on concerns that slower economic growth may hurt trading volumes.

Singapore Exchange, which yesterday reported a 44 per cent jump in the second-quarter net profit, is seeking to diversify its sources of income due to the reducing trading volumes. Trading volumes averaged 1.9 billion a day since the start of the year compared with 2.7 billion last year.

Singapore will contribute less than half of the company's revenue "in a year or two,'' Seck said.

"We have been able to attract sizeable listings from across Asia. The recent trend is that we list more foreign companies every quarter than we do domestic companies.''

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INDIA ON A ROLL

Singapore Exchange needs to attract larger foreign companies to sustain its standing as Southeast Asia's biggest bourse

The exchange is collaborating with foreign bourses to increase revenue from overseas