The Singapore equity market provides an important avenue for Singapore and foreign companies to raise long-term capital
through public issue of their shares on the Singapore Exchange Securities Trading Limited (SGX-ST) Main Board or the
SGX-ST Dealing and Automated Quotation System (SESDAQ).

The Singapore Advantage

Singapore’s financial market has been built on a robust and competent legal and judicial framework. In 2006, the Political
and Economic Risk Consultancy survey distinguished Singapore as having one of the best judicial systems in Asia.

Entrepreneurs and investors favour Singapore as a choice destination for its pro-business environment, established infrastructure,
transparent regulations, political stability, and investor-friendly government policies. Companies considering listing are further
attracted by the following factors:

International recognition

  • Foreign listings constitute more than 30% of all listings on the Singapore Exchange (SGX).

  • Companies listed on SGX are perceived as having good corporate governance.

Door to international investors and global market

  • In 2006, total funds managed in Singapore were approximately S$900 billion.

  • SGX has strategic alliances with major stock exchanges for both the securities and
    derivatives markets.

Comprehensive research coverage

  • Singapore has over 100 research analysts and over 20 research houses covering
    companies listed on SGX.

  • For newly listed companies, SGX and MAS have set up a Research Incentive
    Scheme to facilitate research coverage.

Choice of accounting standards

• For both primary and secondary listings, companies may use financial statements in compliance with:
(i) Singapore Financial Reporting Standards (FRS)
(ii) InternationalAccountingStandards(IAS)

(iii) US Generally Accepted Accounting Principles (US GAAP)

Benefits and Drawbacks of Listing


  • Creates a market for the company’s shares
  • Enhances the status and financial standing of the company
  • Increases public awareness and public interest in the company and its products
  • Provides the company with an opportunity to implement share option incentive schemes for its employees
  • Increases avenues for future fund-raising via the issuance of new shares or other securities
  • Facilitates acquisition opportunities by use of the company’s shares
  • Offers existing shareholders a ready means of realising their investment

• Increases accountability to public shareholders
• Needs to maintain dividend and profit growth trends
• Becomes more vulnerable to unwelcome takeover
• Needs to observe and adhere strictly to the rules and regulations by governing bodies
• Increases costs in complying with higher level of reporting requirements
• Relinquishes some control of the company following the public offering
• Suffers loss of privacy as a result of media interest

Listing Criteria

General Requirements

(i) The company must be a going concern.
(ii) The company should be in a healthy financial position.
(iii) The company’s management team, directors and shareholders should have the experience, 
expertise, character and
integrity to lead and run a listed company.
(iv) The company should eliminate or resolve all conflict of interest situations prior to listing.

Foreign companies seeking listing will need to:
(i) Release all information and documents in English, and all securities will be quoted in Singapore dollars, unless approved
by SGX or MAS.
(ii) Appoint at least two independent directors resident in Singapore.

SGX Main Board and SGX SESDAQ Requirements

Companies considering listing in Singapore may choose to list on either the SGX Main Board or SGX SESDAQ.
The tables below set out the principal criteria for listing on the above-mentioned Boards.

For listing on the SGX Main Board, companies must satisfy one of the following criteria:

SGX Main Board

Criteria 1

Citeria 2

Criteria 3

Pre-tax Profit

Cumulative pre-tax profit of at least S$7.5 million over the last three consecutive years, with a pre-tax profit of at least S$1 million in each of those three years.

Cumulative pre-tax profit of at least S$10 million for the latest one or two years.


Market Capitalisation



Market capitalisation
of at least S$80 million at the time of the initial public offering, based on the issue price and post- invitation issued share capital.


Vested shareholders may not sell their entire shareholdings for a minimum of 6 months after listing.

Vested shareholders
may not sell their entire shareholdings for at least 6 months after listing, and must hold at least 50% of the original shareholdings for the next 6 months.

Substantial independent shareholders, who acquire and make payment for the shares within 12 months from date of listing application, may not sell a proportion of their shareholdings, calculated based on capital gains.

SGX SESDAQ was established to enable sound local and foreign companies which are not able to meet the criteria for listing on the Main Board but still wish to enjoy the benefits of listing to obtain listing. There are no quantitative requirements for listing on SGX SESDAQ.



Pre-tax Profit

No set requirements. Business is expected to be viable and profitable with good growth prospects.

Track Record

A company with no track record has to demonstrate that it requires funds to finance a project or develop a product, which must have been fully researched and costed.


Vested shareholders may not sell their entire shareholdings for at least 6 months after listing, and must hold at least 50% of the original shareholdings for the next 6 months.

Substantial independent shareholders, who acquire and make payment for the shares within 12 months from date of listing application, may not sell a proportion of their shareholdings for at least 6 months, calculated based on capital gains.

Following listing on SGX SESDAQ, companies may apply to be transferred to the Main Board if they satisfy its criteria in the future.

At the time of publication, SGX has proposed to develop a New Board to replace the SGX SESDAQ. The New Board will be
similar to the Alternative Investment Market in the United Kingdom. It will be a sponsor-supervised board tailored to create a
conducive environment for growing companies to list, and to easily raise capital and acquire assets post-listing.

Methods of Listing

A company may seek either a primary listing or secondary listing, where the company is already listed on another stock exchange.
Companies seeking primary listing will need to comply with SGX’s regulations in full, while companies seeking secondary listing will
not need to do so, on condition of adhering to the requirements with respect to secondary listings.

Shareholding Spread

SGX has set minimum public float requirements for the amount of post-invitation share capital, based on market capitalisation.
The table below sets out the requirements:

Market Capitalisation

Minimum Public Float

Number of Shareholders

SGX Main Board

Less than S$300m



S$300m to less than S$400m



S$400m to less than S$1 billion



More than S$1 billion




Any size

15% or 500,000 shares, whichever is greater


Pricing of the Shares

The issue price is largely dependent on the company’s present and future earnings. It is therefore important to prepare a two-year
business plan for review by the issue manager.

For companies without historical records of positive earnings, it is still possible for them to obtain a listing. The issue price may be
based on future earnings, and expert assessment may be required of the company.

Listing Preparation

When considering a listing, a company should ascertain its reasons for such an exercise, and be aware that the preparation and process
of listing will consume a considerable amount of the company’s time and resources. The following are some of the areas that should be
completed or taken into account when considering a listing:

Listing Preparation Checklist

Financial and management control systems

Prepare timely and accurate management accounts.

Ensure adequate internal controls are in place; any highlighted internal control weaknesses must be adequately addressed.

Have in place service contracts for key management staff.

Have in place an employee share option scheme, if any.

Compliance with relevant accounting standards

Prepare the previous three years’ financial statements in accordance with the relevant accounting standards acceptable to SGX.

Identify and resolve any accounting issues or standards that are particular to the industry.

Have the financial statements audited by reputable accounting firms.

If the financial statements of foreign subsidiaries have been prepared using the respective local accounting standards, reconcile
them according to the holding company’s accounting standards and policies as soon as possible.

Corporate restructuring

Determine the businesses or companies that should be included in the proposed listing group. This structure should enable the
business activities and operations to expand in the future.

Within the selected group structure, determine the extent of restatement to be reflected in financial statements and address any
potential conflict of interests that may arise.

Business expansion plan for the next two years

Prepare detailed two-year financial projections for the income, balance sheet and cash flow statements. The business plan must
also include the future plans of the company and the intended use of IPO proceeds.

Interested party transactions and conflict of interests

The management, directors and substantial shareholders of listed companies on SGX are expected to be transparent in any
dealings they may have with the company.

Ongoing significant transactions between the company seeking listing and its management, directors and substantial shareholders
and their associates will have to be reviewed by an Independent Financial Adviser (IFA), to ensure that transactions are conducted
at arm’s length.

Potential conflict of interests between the company and other companies or businesses of the group that are not part of the proposed
listing group, should also be addressed.

Pro forma accounts to be reviewed by auditors

Prepare pro forma income statements for the past three years.

Prepare pro forma balance sheet for the latest accounting year.

Align financial year-end for the past three years, if there is any change in the financial year-end.

Align depreciation policy.

Resolve any outstanding tax issues prior to IPO, if any.

Preparation of prospectus - some key information to be included

History, business, risk factors of the company.

Segmental performance for the past three years, in compliance with the FRS.

Year on year financial analyses for the past three years.

Production processes and a quantification of production capacity and utilisation for the past three years.

Prospects and future plans. 

Timeline to IPO

Professional Help to Pave the Way

The key professionals that an IPO aspirant will require include:

1. The Issue Manager

The listing process kicks off with the appointment of an issue manager, who will assume the position as the company’s sponsor. The issue manager is usually a member of SGX, a merchant bank or similar institutions acceptable to SGX. The issue manager has an active role in priming the company for listing. In addition to managing the IPO, the issue manager also submits the listing application on behalf of the company, and coordinates with SGX on all matters arising from the listing application.

  1. Legal Counsel

    The company has to appoint a lawyer to undertake the legal aspects of listing. This will include the need for an overseas legal counsel if it has overseas subsidiaries, and if required by the issue manager, another legal counsel to advise the issue manager on the issue.

  2. Auditors

    The appointed certified public accountant’s role is to audit the accounts of the company and highlight any weaknesses in the internal controls of the company.

  3. Business Advisors

    The business advisors are able to assist the management in the entire IPO preparation. They will conduct a preliminary appraisal of the company’s readiness to undertake a listing exercise. The business advisors will also prepare the company for IPO by optimising the business value of the company, guiding the company through restructuring the business (if necessary), identifying and resolving issues, compiling and analysing its financial statements, preparing the prospectus and business plan, as well as facilitating the company in upgrading its internal control procedures.

  4. Public Relations Consultant

    Before and during the IPO launch, the company will need to engage a competent public relations firm to assist in increasing investor awareness of the company.

Costs Involved in a Listing Exercise


SGX Main Board


Initial listing fee

S$50,000 – S$200,000

S$10,000 – S$20,000

Annual listing fee

S$25,000 – S$100,000

S$5,000 – S$25,000

Professional fees

From S$700,000

Miscellaneous expenses

From S$200,000

Placement commission & brokerage

3-7% of gross proceeds raised


  1. Corporate governance and transparency

    A successful IPO is only the beginning for greater corporate governance and transparency. Listed companies will
    need to maintain good corporate governance and disclosure policies, in accordance with the requirements of SGX.

  2. Duties and responsibilities of directors

    Directors of a listed company will have to undertake additional statutory duties to ensure that the company is well-managed.
    Directors and management of companies considering a listing on SGX must be ready to take on the responsibilities that
    accompany their respective designations after the listing.

    It is also a pre-listing requirement to disclose if directors have prior experience or have undergone training in the role and
    responsibilities as directors of listed companies.

  3. The Board of Directors

    The practice of good corporate governance is expected of companies listed on SGX. The Board of Directors has to comprise
    at least two independent directors, and to participate in the following committees that are to be formed upon listing:

    (a) Audit Committee
    (b) Nominating Committee (c) Remuneration Committee

  4. Announcement and reporting requirements

    A listed company will have to act in accordance with the financial reporting requirements and obligations as established by SGX.
    Below are some of the regulations as stipulated by SGX:

  • The company and its officers are prohibited from trading in the company’s securities one month before the half-year or full financial
    year results are announced.
  • The Corporate Disclosure Policy stipulates that directors are to disclose any material information of the company, clarify/confirm any
    rumours or reports, and report any unusual trading activity.
  • SGX also stipulates that financial statements for the full financial year must be announced within 60 days of the financial year-end,
    and within 45 days for the first half of the financial 
    year. For companies with market capitalisation exceeding S$75 million, they are
    also required 
    to announce their quarterly results within 45 days from the end of each quarter. The listed company must also hold its
    Annual General Meeting within 4 months after the end of the company’s financial year. Effective 1 September 2006, interim results
    require a “negative assurance” confirmation from the Board of Directors that, to the best of their knowledge, nothing has come to
    their attention that may render the financial results to be false or misleading. 

Sources: IE Singapore and RSM Chio Lim, 2007.