Wednesday December 31, 2008
IPOs at lowest level in 8 years
By IZWAN IDRIS
PETALING JAYA: The number of initial public offerings (IPOs) on Bursa Malaysia sank to its lowest level in eight years in 2008, as companies delayed plans to sell shares to investors amid a rout in equity markets worldwide.
Only 21 companies went public this year, raising RM1.236bil, preliminary data by Bloomberg showed.
The biggest IPO in 2008 was steel maker Perwaja Holdings Bhd with RM367mil in proceeds underwritten by RHB Investment Bank Bhd.
The combined capital raised by companies through IPOs, additional offerings and rights issues shrunk by a massive 74.39% in 2008 to just RM2.778bil, compared with RM10.846bil last year.
The plunge in volume was largely due to a reduction in additional offerings, which totalled only RM355mil from RM6.61bil in 2007, a 94.63% decrease, the data showed.
And only RM66mil were raised by four companies which went public in the last quarter.
The dismal performance by new listings this year was a refelection of the overall weak stock market condition.
The benchmark KL Composite Index was down 39% for the year as at yesterday’s close of 881.63 points.
The worst performing new listing was Winsun Technologies Bhd, down 82.3% from its adjusted IPO price of 28.3 sen to yesterday’s close of 5 sen.
At least three other companies – Fibon Bhd, TFP Solutions Bhd and Asia Bioenergy Tecnologies Bhd – issued free shares ahead of their listings that effectively reduced their respective IPO prices.
Only four companies managed to stay above their IPO prices as at yesterday’s close.
The top performer was Ewein Bhd, up 20.7% from its IPO price at yesterday’s closing price of 84.5 sen.
The biggest IPO for the year, Perwaja, closed at 73.5 sen yesterday, a plunge of 75% from its listing price.
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