BUSINESS ARTICLE

A Guide to the IPO Landscape and Incentives in Singapore

A Guide to the IPO Landscape and Incentives in Singapore

A Guide to the IPO Landscape and Incentives in Singapore

firstpagedigital Business Insights, Share Registry

Singapore’s capital markets offer a strategic gateway to growth for companies seeking to broaden their investor base and raise additional capital. Regulated by the Monetary Authority of Singapore (MAS) and the Singapore Exchange (SGX), the IPO (Initial Public Offering) framework provides a balanced approach that promotes accessibility while safeguarding market integrity in the country. In this guide, we will walk you through the current IPO landscape in Singapore, explore key incentives and introduce the concept of chain listings.

The IPO Landscape in Singapore

Singapore offers a well-structured, transparent environment for companies seeking to go public, anchored by its dual-board system on the SGX:

  • Mainboard: Designed for well-established companies, the Mainboard has higher entry thresholds, including minimum profitability, market capitalisation, and operating track record requirements.
  • Catalist: Tailored for high-growth enterprises, Catalist does not impose fixed quantitative criteria. Instead, companies must engage a sponsor – an authorised corporate finance advisor – who assesses the company’s suitability for listing.

The MAS provides regulatory oversight and enforces a disclosure-based regime. Rather than pre-approving every business decision, MAS focuses on ensuring that companies disclose sufficient, accurate, and timely information to empower investor decision-making. This approach fosters both transparency and strong investor protection, making Singapore one of Asia’s most reputable markets for IPOs.

IPO Landscape in Singapore

Current Trends in the IPO Market

Following a subdued period of IPO activity in recent years, Singapore’s IPO market is showing signs of recovery. Analysts forecast 4 to 10 new listings in 2025, with sectors like real estate investment trusts (REITs), healthcare, and new economy companies expected to lead the rebound.

While challenges such as lower market liquidity and compressed valuations persist, sentiment in the IPO market is improving. Recent reforms introduced by MAS aim to enhance market competitiveness by lowering listing costs and improving post-listing valuations. These regulatory improvements, alongside the expected stabilisation of global interest rates, are likely to boost investor appetite — especially for income-generating sectors like REITs.

2025 could mark the beginning of a new chapter for Singapore’s capital markets.

Key Incentives for IPOs in Singapore

Several incentives have been introduced to encourage more companies to list for an IPO and support the growth of Singapore’s equities market.

Tax Rebates for IPO Listings

Companies going public can now benefit from significant cost savings:

  • 20% corporate tax rebate for new primary listings.
  • 10% corporate tax rebate for secondary listings.

Additionally, newly listed companies can qualify for a Corporate Income Tax (CIT) rebate of up to SGD 6 million per year for the first five years after listing, depending on their market capitalisation.

These incentives substantially reduce the financial burden associated with listing, making Singapore an even more attractive venue for IPOs.

Concessionary Tax Rates for Fund Managers

Fund managers who conduct IPOs in Singapore can benefit from an enhanced concessionary tax rate of 5% under the Financial Sector Incentive-Fund Managers (FSI-FM) scheme. This incentive not only encourages greater participation from the asset management industry, but also reinforces Singapore’s standing as a regional hub for financial services.

Tax Exemptions for Fund Investments

Under specific conditions, income derived from qualifying funds that invest significantly in Singapore-listed equities is exempt from corporate tax. This promotes greater fund investment activity in locally listed companies and helps deepen market liquidity.

Support for REITs

Recognising the importance of REITs to the IPO market, the government has extended key incentives until 2030:

  • Tax transparency treatment for REITs.
  • GST remission benefits.
  • Enhancements to qualifying foreign-sourced income and operational expense deductions.

These measures ensure that Singapore remains a favoured destination for REIT listings globally.

The Equity Market Development Programme (EMDP)

The SGD 5 billion Equity Market Development Programme (EMDP) aims to drive investments in Singapore-listed stocks beyond the traditional index constituents. By boosting liquidity and broadening investor participation, this initiative further enhances the appeal of listing on the SGX.

Enhanced Corporate Structure

Exploring Chain Listings in Singapore

Another trend gaining traction is chain listings, where a parent company already listed on the SGX seeks to list one of its subsidiaries separately. Although not specifically defined under SGX rules, chain listings are recognised as a viable strategic move for companies seeking to unlock subsidiary value or raise targeted growth capital.

Benefits of Chain Listings

Some benefits of chain listings are:

Increased Corporate Visibility

A subsidiary listing on the SGX alongside its parent company enhances visibility and credibility, both for the parent and the subsidiary. This strengthens the group’s profile in global markets.

Simplified Capital Raising

For subsidiaries, listing on the SGX allows for easier access to capital and greater flexibility in financing. It also enables them to raise funds more efficiently from local and international investors.

Enhanced Corporate Structure

Chain listings streamline the corporate structure, providing a clear link between the parent and subsidiary, which can enhance strategic alignment and operational efficiency.

In Singapore, chain listings would typically follow the standard IPO process for either the Mainboard or Catalist, depending on the size and nature of the subsidiary. Here are some key considerations:

Several important factors come into play when considering a chain listing in Singapore:

  • Regulatory Framework: The subsidiary must comply fully with SGX listing rules, including financial criteria and public float requirements.
  • Financial Performance: Meeting profitability or revenue thresholds is crucial, depending on whether the subsidiary aims for the Mainboard or Catalist.
  • Market Capitalisation and Public Float: To satisfy SGX listing requirements, sufficient market capitalisation and public shareholding must be achieved.
  • Disclosure Requirements: A full prospectus must be prepared in line with the Securities and Futures Act (SFA), offering transparency into financials, operations, and risks.
  • Sponsorship: Catalist listings require an appointed sponsor to guide and oversee the process.

How Boardroom Supports Your IPO Journey

The IPO process can be complex, especially when you are balancing growth ambitions with regulatory obligations. BoardRoom is here to support you every step of the way.

As your expert share registry service provider in Singapore, BoardRoom offers comprehensive IPO advisory and support services, including scrutineering services, application support, liaison with regulators, legal advisors and sponsors, and ongoing corporate governance and corporate secretarial support post listing. Our end-to-end support and expertise helps you leverage available incentives and navigate the complexities of the IPO process with confidence.

Talk to BoardRoom today to learn how we can support your successful IPO journey – from the first steps of preparation to achieving your listing goals.

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