Deloitte: Malaysia’s IPOs continue to raise funds, attract investors

KUALA LUMPUR: Initial public offerings (IPOs) are on the rise in Southeast Asia, including in Malaysia, with the region’s positive growth outlook making it an investor favourite, said Deloitte’s Southeast Asia Mid-Year IPO report.

Deloitte Malaysia disruptive events advisory leader Wong Kar Choon said good technology-enabled companies would continue to get the funds they need for expansion, either through an IPO or via private equity funding.

“There continues to be an influx of foreign direct investment due to the region reopening its doors, restoration of the tourism industry, and booming domestic demand.

“Together, these factors have contributed to the positive economic growth in the region despite the global economic uncertainties,” he said.

The Southeast Asia IPO capital market achieved 85 IPOs in the first half of 2023 (1H 2023) with US$3.3 billion (US$1=RM4.57) in IPO proceeds raised and an IPO market capitalisation of US$20.1 billion, compared with 73 IPOs, US$3.1 billion in IPO proceeds and IPO market capitalisation of US$35.4 billion in 1H 2022.

As compared to 1H 2022, 1H 2023 saw a 16 per cent increase in the number of new IPOs and a five per cent increase in IPO amounts raised.

On the homefront, Bursa Malaysia is standing strong with 16 listings raising approximately RM1.6 billion with a market capitalisation of RM9.4 billion.

Radium Development Bhd and Cape EMS Bhd are among the top 10 listings in Southeast Asia, with a combined total of RM667.73 million raised in proceeds, said the report.

In comparison to 1H 2022, Bursa Malaysia had around 16 listings which raised approximately RM2.1 billion, mostly due to the listing of a strong heavyweight, Farm Fresh Bhd.

“These data points to continued confidence in Malaysia’s capital market, with a proven track record of business.

“Most of the 16 IPOs have had high oversubscription rates due to the support from institutions and retail investors,” Wong said.

He noted that the recent announcement by Prime Minister Datuk Seri Anwar Ibrahim on capital market competitiveness had provided substantial positive messages for stakeholders in the capital market, which includes the reduction of stamp duty rates for the trading of listed shares in Bursa Malaysia and a relook at policies to attract and widen the pool of investors. – BK