CHAPTER 1 INTRODUCTION
6.2 Recommendations
of the study, certain improvements may be applied for future research. First, other IPO markets, specifically those in the ASEAN countries, may be studied to widen the scope of knowledge that investors have on underpricing and long-run performance of IPOs in Asian markets. In addition to the first limitation, researchers who wish to supplement the findings of this study may consider other stock exchange markets aside from the Mainboard Markets found in the Singapore Exchange and Bursa Malaysia. Second, since this study faced sampling constraints due to limited IPOs available in the time period employed in the study, future researchers may choose to consider more samples to include which may help them in optimizing the regression analysis in their study and overall improve the findings on the two stock exchanges. This may be done by opting to get the top 5 and bottom 5 IPO performers or all listings in the financial year instead of just the top and bottom 3. Third, in regards to the underpricing determinants, future research may incorporate other factors such as financial and socioeconomic factors that may have significant influences on IPO markets to further explain underpricing occurrences.
Fourth, long-run performance may be measured using other methods for a more large-scale financial analysis of the IPO performance. Lastly, in order to formulate new perspectives on the underpricing phenomenon, seasoned or follow-on offerings, and stock rights offerings may be considered for future research aside from just looking at the initial offerings of public markets.
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Appendices APPENDIX A
CONSOLIDATED LIST OF SAMPLES A1. Singapore Exchange
Identifier (IRC) Company Name Date % Change Industry
USPG.SI USP Group Ltd 2007 -91.03%
Consumer Discretionary
SECL.SI Suntar Eco-City Ltd 2007 -87.59% Consumer Staples
CSIL.SI China Sports International Ltd 2007 -82.73%
Consumer Discretionary
KTLG.SI KTL Global Ltd 2007 26.80% Industrials
FRLD.SI First Resources Ltd 2007 39.20% Consumer Staples
SAMT.SI Samko Timber Ltd 2008 -86.32% Materials
MMPR.SI MMP Resources Ltd 2008 -78.16% Utilities
YNMH.SI Yongmao Holdings Ltd 2008 -68.76% Industrials
WHHL.SI Wee Hur Holdings Ltd 2008 87.50% Industrials
DDHL.SI Dukang Distillers Holdings Ltd 2008 102.01% Consumer Staples REGI.SI Regal International Group Ltd 2008 103.92% Industrials
FOIL.SI Forise International Ltd 2009 -67.54%
Consumer Discretionary
BMMO.SI BM Mobility Ltd 2009 -59.41% Financials
PECL.SI PEC Ltd 2009 -4.81% Industrials
TMCL.SI Transit-Mixed Concrete Ltd 2009 113.64% Industrials
SOGF.SI Sino Grandness Food Industry Group Ltd 2009 45.53% Consumer Staples HLSG.SI Hock Lian Seng Holdings Ltd 2009 2.99% Industrials
DPDL.SI Debao Property Development Ltd 2010 -77.78% Real Estate LETL.SI Leader Environmental Technologies Ltd 2010 -68.03% Industrials MSEL.SI Mun Siong Engineering Ltd 2010 -67.94% Industrials
TTJH.SI T T J Holdings Ltd 2010 -6.44% Industrials
TISE.SI Tiong Seng Holdings Ltd 2010 63.24%
Consumer Discretionary SIHM.SI Sin Heng Heavy Machinery Ltd 2010 1.30% Industrials
Discretionary
PRAL.SI Parkson Retail Asia Ltd 2011 -14.59%
Consumer Discretionary
SHEN.SI Sheng Siong Group Ltd 2011 111.28% Consumer Staples
XMHL.SI XMH Holdings Ltd 2011 17.38% Industrials
ZBRG.SI Zhongmin Baihui Retail Group Ltd 2011 374.91%
Consumer Discretionary
JBFO.SI JB Foods Ltd 2012 -65.20% Consumer Staples
GEOE.SI Geo Energy Resources Ltd 2012 -29.00% Materials
CIVM.SI Civmec Ltd 2012 -39.53% Industrials
BUMI.SI Bumitama Agri Ltd 2012 -38.03% Consumer Staples
AMOS.SI AMOS Group Ltd 2012 -3.01% Energy
CORD.SI Cordlife Group Ltd 2012 60.40% Health Care
PACI.SI Pacific Radiance Ltd 2013 -87.72% Energy
KRIS.SI KrisEnergy Ltd 2013 -86.71% Energy
AMCO.SI Amcorp Global Ltd 2013 -68.44% Real Estate
OVER.SI Overseas Education Ltd 2013 -45.63%
Consumer Discretionary
SOIL.SI Soilbuild Construction Group Ltd 2013 -41.63%
Consumer Discretionary HALC.SI Halcyon Agri Corporation Ltd 2013 -0.48% Materials
JAPF.SI Japfa Ltd 2014 -43.40% Consumer Staples
IFAS.SI IFAST Corporation Ltd 2014 -12.66%
Communication Services
FSCA.SI First Sponsor Group Ltd 2014 -11.16% Real Estate
BOUS.SI Boustead Projects Ltd 2015 -8.55% Industrials
ZHEN.SI Zheneng Jinjiang Environment Holding Co Ltd 2016 -32.42% Utilities
PROC.SI Procurri Corporation Ltd 2016 -9.30%
Information Technology Note: *For 2007, there are only five (5) listings. For 2011, there are only five (5) listings. For 2014, there are only three (3) listings. For 2015, there is only one (1) listing. For 2016, there are only two (2) listings.
A2. Bursa Malaysia
Identifier (IRC) Company Name Date % Change Industry
MEHB.KL Melati Ehsan Holdings Bhd 2007 -39.85% Industrials
DLEU.KL Deleum Bhd 2007 -47.86% Energy
PTRE.KL Petra Energy Bhd 2007 -61.59% Energy
SPLN.KL Sarawak Plantation Bhd 2007 -13.35%
Consumer Staples ANCR.KL AEON Credit Service (M) Bhd 2007 33.60% Financials
MYEG.KL My EG Services Bhd 2007 230.77%
Information Technology
SCGB.KL SCGM Bhd 2008 -36.36% Materials
SGNA.KL Signature International Bhd 2008 -13.46%
Consumer Discretionary
UZMA.KL Uzma Bhd 2008 2.05% Energy
MXSC.KL Maxis Bhd 2009 35.01%
Communication Services
MIKB.KL Mikro MSC Bhd 2009 113.33%
Information Technology
COWH.KL China Ouhua Winery Holdings Ltd 2010 -88.79%
Consumer Staples
KSTR.KL K-Star Sports Ltd 2010 -84.62%
Consumer Discretionary
HBGL.KL HB Global Ltd 2010 -82.39%
Consumer Staples
KICB.KL Kimlun Corporation Bhd 2010 79.30% Industrials
CYPR.KL Cypark Resources Bhd 2010 119.92% Industrials
SACB.KL Sarawak Cable Bhd 2010 207.05% Industrials
XOXB.KL XOX Bhd 2011 -86.45%
Communication Services
MCLN.KL MClean Technologies Bhd 2011 -81.58% Industrials
WIDA.KL Widad Group Bhd 2011 -81.21% Industrials
BJFO.KL Berjaya Food Bhd 2011 244.65%
Consumer Discretionary Consumer
FOLU.KL Focus Lumber Bhd 2011 23.69% Materials
FGVH.KL FGV Holdings Bhd 2012 -74.47%
Consumer Staples
AYSV.KL AYS Ventures Bhd 2012 -61.24% Industrials
PASU.KL Pasukhas Group Bhd 2012 -54.93% Industrials
OCKG.KL OCK Group Bhd 2012 140.74%
Communication Services
PESO.KL Pesona Metro Holdings Bhd 2012 161.11% Industrials PEIN.KL PESTECH International Bhd 2012 631.52% Industrials
CAPH.KL China Automobile Parts Holdings Ltd 2013 -88.32%
Consumer Discretionary
VELE.KL Velesto Energy Bhd 2013 -78.46% Energy
AIRX.KL AirAsia X Bhd 2013 -69.28% Industrials
LEON.KL Leon Fuat Bhd 2013 -47.09% Materials
NWPH.KL NWP Holdings Bhd 2013 -42.50% Materials
LHEN.KL Lii Hen Industries Bhd 2013 344.53%
Consumer Discretionary
ICON.KL Icon Offshore Bhd 2014 -91.59% Energy
CARM.KL Carimin Petroleum Bhd 2014 -73.81% Energy
RESE.KL Reach Energy Bhd 2014 -56.09% Energy
BOPL.KL Boustead Plantations Bhd 2014 -26.55%
Consumer Staples
ONLY.KL Only World Group Holdings Bhd 2014 42.19%
Consumer Discretionary
ECOH.KL Econpile Holdings Bhd 2014 304.05% Industrials
DOLP.KL Dolphin International Bhd 2015 -89.73% Industrials
IKHM.KL Ikhmas Jaya Group Bhd 2015 -86.52% Industrials
SEDA.KL Sedania Innovator Bhd 2015 -77.36%
Communication Services
BIOA.KL Bioalpha Holdings Bhd 2015 -15.00%
Consumer Staples SCOG.KL Sunway Construction Group Bhd 2015 -3.30% Industrials
XINW.KL Xin Hwa Holdings Bhd 2015 0.57% Industrials
LKLI.KL LKL International Bhd 2016 -62.07% Health Care
RHON.KL Rhone Ma Holdings Bhd 2016 -2.40% Health Care
DNCO.KL Dancomech Holdings Bhd 2016 74.65% Industrials
FOUN.KL FoundPac Group Bhd 2016 96.91%
Information Technology
MYNE.KL myNEWS Holdings Bhd 2016 101.47%
Consumer Discretionary Note: *For 2008, there are only three (3) listings. For 2009, there are only two (2) listings.
Appendix B:
Descriptive Statistics for Time Period Analysis A. 2007-2011
Table 28.
Descriptive Statistics for Singapore Exchange from 2007-2011
Variables Mean Median Min Max Std. Dev
Ownership Structure (%) (x1) 32.707 25.845 5.14 100.00 20.384 Firm Size (in USD millions) (x2) 126.98 65.000 9.9800 501.80 136.66 Firm age (in years) (x3) 6.8214 2.5000 0.0000 41.000 11.102 Offering Size (in USD millions) (x4) 1.5686 0.78293 0.27375 7.4453 1.8116 Financial Leverage (x5) 26.964 5.5000 0.0000 159.00 42.753
ROE (%) (x6) 27.989 31.050 -3.4000 90.400 26.119
Offering Price (in USD) (x7) 0.27453 0.21718 0.14600 0.80300 0.16115
MAAR (%) (y) 305.39 14.992 -59.201 1387.0 490.74
Table 29.
Summary of Firm Industries in Singapore Exchange from 2007-2011
Variables Frequency Percent
Consumer Discretionary (x11) 7 25.00%
Consumer Staples (x12) 5 17.86%
Financials (x14) 1 3.57%
Industrials (x10) 12 42.86%
Materials (x9) 1 3.57%
Real Estate (x18) 1 3.57%
Utilities (x17) 1 3.57%
Total 28 100.00%
Table 30.
Descriptive Statistics for Bursa Malaysia from 2007-2011
Variables Mean Median Min Max Std. Dev
Ownership Structure (%) (x1) 56.713 42.200 12.100 100.00 35.200 Firm Size (in USD millions) (x2) 82.479 26.600 5.2000 910.10 185.84 Firm age (in years) (x3) 4.5652 2.0000 0.0000 22.000 5.4425 Offering Size (in USD millions) (x4) 132.47 4.3004 0.36960 2808.0 583.65 Financial Leverage (x5) 30.304 6.0000 0.0000 406.00 85.480
ROE (%) (x6) 18.422 23.800 -92.700 70.300 29.590
Offering Price (in USD) (x7) 0.3632 0.17208 0.052800 1.9200 0.44424
MAAR (%) (y) 6.4017 -8.4268 -92.449 279.92 91.226
Table 31.
Summary of Firm Industries in Bursa Malaysia from 2007-2011
Variables Frequency Percent
Communication Services (x16) 2 8.70%
Consumer Discretionary (x11) 4 17.39%
Consumer Staples (x12) 3 13.04%
Energy (x8) 3 13.04%
Financials (x14) 1 4.35%
Industrials (x10) 6 26.09%
Information Technology (x15) 2 8.70%
Materials (x9) 2 8.70%
Total 23 100.00%
B. 2012-2016
Table 32.
Descriptive Statistics for Singapore Exchange from 2012-2016
Variables Mean Median Min Max Std. Dev
Ownership Structure (%) (x1) 33.367 26.200 15.900 94.900 19.416 Firm Size (in USD millions) (x2) 384.52 98.600 30.400 1963.6 528.49 Firm age (in years) (x3) 5.6111 5.0000 0.0000 19.000 5.0659 Offering Size (in USD millions) (x4) 4.0305 2.5889 0.36500 11.563 3.9252 Financial Leverage (x5) 51.222 26.500 0.0000 201.00 57.391
ROE (%) (x6) 19.794 18.050 -3.4000 54.700 15.513
Offering Price (in USD) (x7) 0.48484 0.40150 0.18250 1.0950 0.24965
MAAR (%) (y) 21.395 5.1519 -19.540 177.49 42.596
Table 33.
Summary of Firm Industries in Singapore Exchange from 2012-2016
Variables Frequency Percent
Communication Services (x16) 1 5.56%
Consumer Discretionary (x11) 2 11.11%
Consumer Staples (x12) 3 16.67%
Energy (x8) 3 16.67%
Health Care (x13) 1 5.56%
Industrials (x10) 2 11.11%
Information Technology (x15) 1 5.56%
Materials (x9) 2 11.11%
Real Estate (x18) 2 11.11%
Utilities (x17) 1 5.56%
Total 18 100.00%
Table 34.
Descriptive Statistics for Bursa Malaysia from 2012-2016
Variables Mean Median Min Max Std. Dev
Ownership Structure (%) (x1) 40.363 33.900 5.000 100.00 21.939 Firm Size (in USD millions) (x2) 328.41 53.315 1.2000 3259.0 797.02 Firm age (in years) (x3) 8.0333 2.0000 0.0000 68.000 14.058 Offering Size (in USD millions) (x4) 177.83 7.9628 0.96000 4068.0 738,13 Financial Leverage (x5) 199.80 30.000 0.0000 5040.0 914.83
ROE (%) (x6) 12.854 13.800 -39.000 35.300 14.705
Offering Price (in USD) (x7) 0.2343 2
0.18000 0.028800 0.79200 0.17380
MAAR (%) (y) 21.435 -2.8882 -92.550 432.72 123.14
Table 35.
Summary of Firm Industries in Bursa Malaysia from 2012-2016
Variables Frequency Percent
Communication Services (x16) 2 6.67%
Consumer Discretionary (x11) 4 13.33%
Consumer Staples (x12) 3 10.00%
Energy (x8) 4 13.33%
Health Care (x13) 2 6.67%
Industrials (x10) 12 40.00%
Information Technology (x15) 1 3.33%
Materials (x9) 2 6.67%
Total 30 100.00%
Appendix C:
Diagnostic Tests for Stepwise Regression Model of SGX and KLSE (2007-2016) A. SGX
Table 36. Diagnostic Test for the Stepwise Regression Analysis of SGX (2007-2016)
Diagnostic P-Value Null hypothesis Interpretation Breusch-Pagan test
for
heteroskedasticity 0.000549063
heteroskedasticity not present
Not Passed
Test for normality of
residual 1.70623e-010
error is normally distributed Not Passed
Chow test 0.135441 no structural break Passed