Thailand will be the most popular IPO market in Southeast Asia with $ 5 billion in second-half reserve funds

BANGKOK / SINGAPORE (Reuters) – Thailand is expected to receive the most IPO funds in Southeast Asia this year, more than $ 5 billion is expected to be raised in the second half of the year, according to a tourism source that will boost the economy. economy fueled by inconclusive elections.

Southeast Asia's second-largest economy is expected to receive listings from PTT Pcl's public retail group, Charoen Sirivadhanabhakdi's motel and one of the largest distribution groups in the country. country, the central group.

The first sale of shares of these companies and other companies could make it the country's biggest success in six years, said sources, who were not allowed to speak to the media.

Investors focus on the country's stable economic growth and currency and see no major risk badociated with political uncertainty. Preliminary election results show that Pheu Thai, the main anti-junta, won the most seats in his constituency, while Palang Pracharat, who is an army, won the most votes, but each is unable to form his own government.

Low interest rates and the hunt for high-yield badets are driving investors to allocate funds to equities, fund managers said.

"People are waiting and the IPOs are going to sell," said Narongchai Akrasanee, president of MFC Asset Management.

Tourism is an important pillar of Thailand's growth, with the country expecting an increase in visitor numbers of 7.5% this year. Thailand's finance minister announced last week that the country would adopt economic measures worth about 20 billion baht ($ 624 million) to boost consumption, tourism and help low-income people.

Last year, Vietnam was the largest IPO market in Southeast Asia, with registrations yielding $ 3.4 billion, according to Refinitiv data.

Bankers estimate that 2019 will be the best year for Thailand's IPOs since 2013, when they raised more than $ 6 billion. In 2018, Thai registrations raised $ 2.5 billion after recovering $ 3.8 billion in the previous year, according to Refinitiv data.

"One of Thailand's positive points is that the liquidity of domestic investors is extremely healthy," said Ho Cheun Hon, Head of Capital Markets in Southeast Asia of Credit Suisse, based in Singapore.

"Assuming that the final election result does not have a negative impact on the sentiment of consumers and investors, we hope that market conditions in the second half of the year will be constructive for the solid Thai pipeline," he said. Oil & Retail, which includes gas stations, coffee shops and convenience stores, is expected to launch its IPO process after the election results and could bring in about $ 2 billion, according to sources.

The Central Group's retail outlet operator is also expected to be positioned on the stock market later this year and could reap between $ 1 billion and $ 2 billion, sources said.

Asset World Corp, the TCC Group's hotel arm, which owns office buildings, luxury hotels and shopping malls, plans to launch an initial public offering of $ 1 billion to $ 1.5 billion. in the second half of the year, the IFR announced in January.

PTT, TCC and Central have not responded to Reuters' requests for comment.

Although the markets are volatile in the short term, the Thai benchmark is moving closer to its historical five-year PE ratio. The IPO plans should therefore move forward if the political situation was clearer in the second half of 2019, said Nunmanus Piamthipmanus. Investment Director of SCB Asset Management.

Some investors cautioned, however, that issuers must ensure that IPOs are not overvalued.

"Competition and supply in offices, hotels and shopping centers make these areas difficult," says Thidasiri Srisamith, chief investment officer at Kasikorn Asset Management.