Listed warrants still in the zone

A FEW local companies have been raising funds through rights issues that come with unlisted, free warrants as "sweeteners" to ensure the rights are taken up. These novel instruments were featured in this column recently, but equally interesting is that dozens of local companies have also raised funds via rights issues that include listed warrants with intriguing features of their own.

A good example is Sinarmas Land's warrant, which expires in November 2015 and is the only pure "European-style" warrant listed here. (The letter "e" next to its description on the Singapore Exchange's website denotes this feature.)

Unlike the more common "American-style" instrument, the Sinarmas warrant can only be converted to shares upon expiry. In theory, this should not have a major influence on its price. In practice, it could play a part; add the exercise price of 10 cents to the warrant's price of 28.5 cents, and we find that…