Indian Inc flocks SGX
The Financial Express
SUNITA JYOTI & ROOPA KULKARNI
Posted online: Tuesday, June 06, 2006 at 0000 hours IST
MUMBAI, JUNE 5: With the Singapore government planning to relax a few listing requirements for the Singapore Exchange (SGX),
many Indian corporates across sectors are heading towards the city-state to be the flavour of the local investors.
A total capital of close to S $ 1 billion is expected to be raised by the Indian companies in the next six months through listing on the SGX. With assets under management of over S $ 280 billion
According to the current listing requirements of SGX, an issuer needs to obtain the shareholders’ approval for any interested person transaction of a value equal to or more than 5% of the group’s latest
audited net tangible assets, when aggregated with other transactions entered into with the same interested person during the same financial year.
According to the current listing requirements of SGX, an issuer needs to obtain the shareholders’ approval for any interested person transaction of a value equal to or more than 5% of the group’s latest audited
net tangible assets, when aggregated with other transactions entered into with the same interested person during the same financial year.
However, SGX is planning to moderate this requirement in the next 2-3 months, which will boost India Inc’s chances of being listed on the SGX. In the next six months, two shipping companies (Varun Shipping being one of them),
a power company, a research driven pharma company, a water treatment company and a food and beverages company are planning to get listed on the SGX.
DBS Bank’s head-investment banking Nandakumar Ranganathan said, " We are currently working with a speciality company in the power sector who is looking at a dual/follow on listing."
SGX provides attractive valuations in sectors like shipping at a significant premium to domestic valuations. Mr Nandakumar said that shipping companies in Singapore are valued at much lower discounts to their net tonnage
values compared with the higher discounts at which the Indian exchanges value them.
Similarly, valuations for integrated transportation companies also range around a P/E of 40x. Further, electrical companies are valued in the 15-26x range." DBS Bank led the listing of Meghmani Organics on the SGX--the first Indian company to be listed.
Market depth, adequate yet pragmatic regulatory requirements, reasonable listing and post listing compliance costs, speed of listing and ability to value businesses fully are what an exchange has to offer a potential issuer and Singapore is well positioned on all these counts, he said.
The India-Singapore CECA signed in 2005 is expected to provide further fillip and connectivity to the Asean region. The CECA at a broader level is expected to channel investments through Singapore into India. Top | 
