2023 has been a rollercoaster for Singapore’s Initial Public Offering (IPO) market, with more dips than climbs. The numbers tell a stark story: a 95% drop in IPO proceeds to $28 million and market caps dwindling to $137 million.
Despite this, together with the Asia-Pacific region, Singapore holds its ground as the IPO heavyweight, clinching around 60% of the worldwide share. And in 2023, a few bold companies have stepped up, ready to test the waters of the public market.
This is the story of Singapore’s daring few, navigating through a year of financial ebbs and flows.
Disclaimer: Market analysis for this article was conducted on 12 Nov 2023.
Singapore’s IPO Class of 2023
The daring few companies that went public in 2023 have had to demonstrate remarkable resilience. Their post-IPO journeys have seen both ups and downs.
Singapore’s IPO class of 2023 includes:
- OhMyHome Ltd.
- Simpple Ltd.
- MoneyHero Ltd.
- YKGI Ltd.
- Ever Glory United Holdings Ltd.
- Pasture Holdings Ltd.
These companies have each charted their course in the volatile post-IPO environment. We take a closer look at how they have fared.
OhMyHome Ltd.: A Homegrown Property Tech Pioneer
OhMyHome is a proptech platform in the real estate industry that offers end-to-end property solutions for real estate transactions. The company provides a unique hybrid model of DIY services and full-fledged agency assistance. They went public on the Nasdaq in March 2023. The main reason for OhMyHome’s IPO was to raise capital and boost brand awareness.
OhMyHome Performance Analysis
OhMyHome’s share price has dropped 55.1% since its IPO at $4.14 per share. On October 11, 2023, it closed at $1.86 after reaching a 52-week high of $27.13. This steep decline triggered trading halts, highlighting OhMyHome’s challenges.
Singapore’s competitive property landscape has posed difficulties for OhMyHome to attract homebuyers cost-effectively. Analysts have speculated that its unproven model and rapid early growth might have led to unsustainable valuations.
For public investors, this competitive environment and OhMyHome’s challenges in differentiating itself raise questions about its ability to establish a defensible position and achieve sustainable growth. Investors may want to observe how OhMyHome adapts its strategy and execution before committing significant capital.
Simpple Ltd.: Innovation on the Nasdaq Frontier
Simpple Ltd operates in Singapore’s PropTech industry. Its unique SIMPPLE Ecosystem automates services like building maintenance and security for facility owners.
Simpple has market penetration in Singapore, serving over 200 schools, hospitals and universities. It went public on the Nasdaq in September 2023 to raise capital for overseas expansion.
Simpple Ltd. Performance Analysis
Since its IPO at $5.25 per share, Simpple’s stock has fluctuated between $4.20 to $5.70. It closed at $5.11 on November 8, 2023, a modest increase.
While generating $4.8 million in revenue, Simpple operates at a $580,721 net loss as costs outweigh income. This suggests investors remain cautious as profitability has yet to be achieved.
For investors considering Simpple, it may be prudent to take a wait-and-see approach at this stage. The company shows promising top-line growth, but its inability to convert revenue into profit can be regarded as a red flag.
MoneyHero Ltd.: Navigating Through Market Turbulence
MoneyHero SG operates in Singapore’s fintech sector as part of MoneyHero Group. It offers a platform comparing financial products to empower consumer choices in Singapore’s competitive financial landscape.
MoneyHero Group went public on the Nasdaq in October 2023 via a SPAC merger, aiming to accelerate growth and capture opportunities in Southeast Asia’s fast-growing digital financial services market.
MoneyHero Ltd. Performance Analysis
MoneyHero’s share price has plunged over 30% since its IPO to $1.05 in November 2023, with its market cap standing at just $25 million. This reflects a substantial $137 million net loss despite generating revenue of $103 million, highlighting profitability concerns.
The sharp decline also points to challenging market conditions for growth stocks amid rising interest rates and economic uncertainty weighing on investor appetite.
Specifically, MoneyHero’s net loss widened by 59.8% year-on-year to $49.44 million in 2022, even as revenue rose 10.1% to $68.13 million. This indicates that expenses are rapidly outpacing income growth, eroding profitability and dampening investor confidence.
MoneyHero Ltd. streamlines financial choices with user-friendly tools, striving to make personal finance accessible to all. Their IPO journey began with the promise of expanding their financial empowerment platform to a wider market.
YKGI Ltd.: Steady in the Food Sector
YKGI Ltd is a Singapore F&B company operating brands like Yew Kee Duck Rice and XO Minced Meat Noodles. It has over 30 years of experience in F&B operations, food courts, and central kitchens. YKGI went public on the SGX in February 2023.
The company owns a diverse portfolio of non-Halal and Halal dining brands. Its IPO listing was assisted by CLA Global TS, formerly Nexia TS.
YKGI Ltd. Performance Analysis
YKGI’s stock has fluctuated since its IPO debut at $0.033 in February 2023, ranging between $0.025 and $0.038 so far in 2023. As a new listing, volatility is expected as investors evaluate growth prospects.
Broader market swings, competitive dynamics, and varying financials contribute to the price fluctuations. YKGI’s limited trading history exacerbates the volatility.
However, YKGI’s dividend yield and brand portfolio appeal to investors seeking returns and stability. With 30+ years in F&B, YKGI has a strong foundation that could steady performance over time through consistent execution. While uncertain initially, YKGI has potential if it delivers on growth plans.
For investors, YKGI’s outlook will become clearer as more data emerges post-IPO. While volatility is expected initially, YKGI has long-term potential if it can deliver on its growth plans.
Ever Glory United Holdings Ltd.: Engineering Market Stability
Ever Glory United Holdings Ltd. is a mechanical and electrical engineering company serving the infrastructure sector across various property types in Singapore. The company went public on the SGX in May 2023, marking a significant milestone in its vision to enhance service offerings and expand market reach.
Ever Glory United Holdings Ltd. Performance Analysis
Ever Glory’s stock price has remained stable at SGD 0.370 since its IPO debut. It currently has a market capitalisation of SGD 62.68 million. Over the past 3 months, the stock has seen a substantial 42.31% increase, reflecting enduring investor confidence.
The steady performance of Ever Glory’s stock post-IPO indicates a market that values the company’s specialised engineering expertise and long-term growth potential. The notable rise over the last quarter suggests investors recognise the company’s prospects for sustained expansion. Overall, the stock’s stability and substantial gain make it an attractive option for investors seeking exposure to Singapore’s engineering service sector.
Pasture Holdings Ltd.: Fluctuating Fortunes
Pasture Holdings Ltd is a Singapore-based company focused on pharmaceuticals and medical devices. It went public with an IPO on the SGX in June 2023, a strategic move to boost expansion globally and reaffirm its commitment to healthcare solutions.
Pasture Holdings Ltd. Performance Analysis
Pasture Holdings’ stock price stands at SGD 0.185, having faced fluctuations since its debut. A 7.50% decline occurred over the past 5 days. However, the stock saw a monthly gain of 8.82%, signalling some recovery and steadying after initial volatility post-IPO.
Pasture Holdings’ post-IPO stock performance indicates a company gradually stabilising after early instability. The recent modest rise suggests some renewed investor optimism, potentially due to the company’s strategic adaptations to thrive in the competitive pharmaceutical and medical device landscape.
Analysing the IPO Aftermath
Singapore’s 2023 IPO scene reveals evolving trends and selective conditions. Only 6 intrepid companies went public this year amid financial uncertainty—a slim lineup reflecting more prudent choices.
With Singapore’s latest crop of IPOs now trading on the public markets, the real test of their staying power and performance begins. The post-IPO period is often marked by volatility, as the market processes expectations versus realities. Now, these companies must demonstrate their growth potential to weather the storms. It is common for stock prices to fluctuate after an IPO as the market finds the right valuation.
2 key factors drive this volatility: the lack of REITs and SPACs.
With rising interest rates, REITs are less attractive to investors looking for higher returns.
Meanwhile, the SPAC frenzy has fizzled out after peaking in early 2022. The 3 SPACs listed last January are still seeking acquisitions under tight deadlines. This mirrors a global cooling towards SPACs, with increased diligence by investors and regulators.
These shifts have opened the stage for a diverse range of businesses in 2023’s IPOs, beyond the usual REIT and SPAC fare. The choosy environment indicates that companies must prove their mettle before public listing. For investors, vigilance is key when assessing new opportunities.
Revisiting Singapore’s IPO Alumni
On the other hand, Grab and PropertyGuru underscore the volatile nature of IPOs, where initial market enthusiasm can quickly give way to the realities of economic pressures and shifting investor moods. These cases serve as a barometer for the health and sentiment of the broader market while reflecting the intricate dance between investor expectations and company performance.
Grab: From Superapp to Market Sobriety
Grab, renowned for its comprehensive ‘superapp’ capabilities, experienced a significant decline in its share value, dropping over 70% following its public offering in December 2021. The company, which entered the Nasdaq through a merger with a SPAC, saw its initial share price surge to US$16.75, only to settle at approximately US$3.50 in the current trading climate.
Grab’s post-IPO journey has been tumultuous, with its stock falling sharply from its peak. However, recent cost-cutting, including a workforce reduction, has led to a narrower loss and a 15% stock rise this year, signalling a potential turnaround.
Despite narrowing losses and a 130% revenue increase in Q1 2023, Grab’s stock has not recovered. The market remains unappeased, even with a 3% growth in GMV, indicating that investor confidence requires more than improved financials.
Despite Grab’s efforts to cut costs and grow revenue, its stock price can’t seem to get off the ground. This shows investors are getting fed up with the lack of profits – revenue growth alone won’t appease shareholders anymore. They want to see money on the bottom line.
Now investors are rightly sceptical of the business model. The stock may languish until Grab can prove it can turn a strong profit, not just grow revenue. Cost-cutting can only help so much here – profits matter most to shareholders.
PropertyGuru: Navigating Market Turbulence
PropertyGuru Group began its NYSE journey in March 2022 after merging with a SPAC backed by high-profile investors. This move valued the Southeast Asian real estate marketplace at $1.6 billion. Although its shares initially soared, they have since halved in value, reflecting the market’s challenging dynamics post-IPO.
After reporting higher net losses in Q1 2022, PropertyGuru’s stock saw its steepest decline in May 2022. Despite reducing net losses in Q1 2023, external factors like government policies in Vietnam, Malaysia’s political landscape, and Singapore’s property tax hikes pose significant challenges.
Questionable moves like expanding into traditional real estate before fully dominating digital now look risky as the core business faces headwinds while new initiatives strain profits. Investors have good reasons to be wary.
Unless PropertyGuru can showcase strong execution despite the tough environment, its stock will likely remain depressed. This company may have expanded too quickly, damaging its financial position. Investors want to see focused growth and paths to profitability before commitment. Macro trends are not currently in PropertyGuru’s favour.
What This Means for Singaporean Investors
The influx of IPOs affects Singaporean investors in complex ways. More IPOs seem positive, expanding investment options. However, risks also increase in unpredictable markets.
On one hand, investors gain access to more homegrown companies across industries. This allows greater diversification and potential upside if bets on growth pay off. However, stocks can swing wildly, punishing those who invest at peaks. Focus on short-term gains may also undermine companies’ long-term health.
The recent IPOs in Singapore have shown a mixed bag of results. Still, those willing to take the risk demonstrate Singapore’s innovative capacity. Investors should research carefully to balance risks and rewards in new listings.
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