Make an offer: A significant number of new IPOs are expected in 2017


The Stock Exchange of Thailand (SET) missed its targets for initial public offerings (IPOs) in 2016 after two deals were delayed due to a change in accounting standards under the Securities and Exchange Commission’s (SEC) financial reporting requirements. Despite the temporary contraction, IPO growth is set to accelerate in 2017, with IPO attractiveness buoyed by triple-digit growth in share prices at several recent listings. Several deals that were delayed are also expected to move forward in 2017, including IPOs for major beverages conglomerate Osotspa, state-owned Bangkok Commercial Asset Management (BAM) and the Thailand Future Fund (TFF).

IPOS In 2016

The SET reported in late 2016 that 27 IPOs were launched on the main bourse, as well as the Market for Alternative Investment (MAI), in 2016, adding BT52.8bn ($1.5bn) from the primary market and BT158bn ($4.5bn) in market capitalisation. This was a decline from the previous year, with the SET reporting in mid-December 2015 that 38 listings raised BT297bn ($8.4bn) in market capitalisation, well above the targeted BT250bn ($7bn). The SET later stated in a mid-2016 report that the total number of new securities listed in 2015 hit 41, including 20 SET-listed companies, 13 MAI-listed firms, six property funds and real estate investment trusts, and two infrastructure funds.

Although listings and IPO values were lower in 2016 than in 2015, a number of companies recorded a standout performance following their IPOs. When dessert cafe chain After You listed on the MAI its share prices soared by 200% from BT4.50 ($0.13) during its first day of trading, in December 2016. IT solutions firm Netbay recorded a similar increase, with share prices rising by 183% from BT4 ($0.11) in early June 2016, while Ekachai Hospital’s share prices rose by 116% from BT3.05 ($0.09) on the first day of trading on in mid-July 2016. The largest IPO of 2016 was that of Banpu Power, which priced its October 2016 IPO at BT21 ($0.59) per share to raise BT13.6bn ($383.1m). The company, which holds 1883 MW of generating capacity through stakes in renewable and conventional power plants, issued 648m shares, including a preferential offer of 210m shares to the shareholders of its parent company, coal producer Banpu. The private Rajthanee Hospital, meanwhile, planned to raise BT1.2bn ($33.8m) from selling 74.99m shares priced at BT16 ($0.45) in late August 2016.


In October 2016 the SET announced it would not reach its 2016 target of BT190bn ($5.4bn) in new market capitalisation from securities IPOs, which had been revised downwards from BT270bn ($7.6bn), after two major deals worth an estimated BT100bn ($2.8bn) were delayed. The first was for Osotspa, Thailand’s oldest consumer products conglomerate. With more than 50 companies operating under the Osotspa portfolio, the company maintains a strong presence in lifestyle and consumer products, beverages and medicine.

Accounting Challenge

BAM moved in late 2015 to submit initial documentations for an IPO under the supervision of the State Enterprises Policy Office. Its offering would make it the first state agency to raise funds on the bourse, although the listing was delayed in 2016. “Changes in the SEC’s Thai Financial Reporting Standards in 2016 meant that some companies delayed their launch only because they were bringing their accounting standards into compliance. Brexit, the US presidential election and the world economy have worried some, but these are largely external factors that had no bearing on IPOs in 2016,” Kanate Wangpaichitr, secretary-general of the Federation of Thai Capital Market Organisations, told OBG.

However, 2017 looks to be a better year for IPOs, and in addition to Osotspa and BAM’s potential listings, the SET could also benefit from a major government IPO: the TFF, with assets that include tolled highways owned by the Expressway Authority of Thailand. The fund is expected to list in the third quarter of 2017, offering between BT20bn ($563.4m) and BT30bn ($845.1m) to investors in its first tranche. In late 2015 Reuters estimated the deal would be valued at BT100bn ($2.8bn).