Sliver of hope for Singapore IPO market as karaoke chain, interior decoration firm mull Catalist listings

SINGAPORE’S barren spell for initial public offerings (IPOs) could come to an end, as two companies in late September lodged their preliminary offer documents for listing on the Catalist board of the Singapore Exchange (SGX).

This offers a sliver of hope for Singapore’s equities market, which is the worst-performing market in South-east Asia for IPOs this year.

The city-state had just one IPO in the first three quarters of the year, with cancer treatment provider Singapore Institute of Advanced Medicine Holdings’ Catalist listing in February raising gross proceeds of S$26.2 million or net proceeds of S$21.7 million.

In contrast, Malaysia led IPO activity in the region over the same period with 35 new listings. This includes the blockbuster listing of mini-market chain 99 Speed Mart Retail in September to raise RM2.36 billion (S$720 million).

Singapore’s two new listing hopefuls are not expected to elicit the same level of excitement from investors.

Attika Group

Interior decoration and mechanical, electrical and plumbing engineering company Attika Group, which lodged its preliminary offer document on Sep 30, posted a profit of S$2.3 million for its latest financial year ended December 2023 – up around 10.1 per cent from S$2.1 million the year before.

Its revenue climbed around 8.3 per cent to S$27 million for FY2023, up from S$24.9 million in FY2022. 

Gross profit rose 34.7 per cent to S$5.9 million in FY2023, from S$4.3 million in FY2022, as revenue from higher-margin projects taken on in FY2022 was recognised.

Attika Group attributed the rise in revenue to the completion of four projects, including a retail supermarket at Orchard Point, as well as a new corporate office project secured in FY2023. 

The company said it works with third-party contractors and has its own in-house team comprising some 58 full-time carpenters, metal workers, mechanical and engineering tradesmen.

RHB Bank will be the full sponsor, issue manager and placement agent for Attika Group’s potential IPO.

Goodwill Entertainment

Meanwhile, entertainment operator Goodwill Entertainment, which runs the karaoke chain HaveFun Family Karaoke, lodged its preliminary offer document on Sep 27.

The company’s profit after tax and minority interests more than doubled to S$2.9 million for its most recent financial year ended December 2023, up from S$1.1 million in FY2022. 

The increase came on the back of a 45.1 per cent increase in revenue to S$23.9 million in FY2023, from S$16.5 million in FY2022. 

The higher revenue was attributed to the opening of two karaoke outlets, as well as full-year contributions from its existing outlets. Operations at its outlets had been disrupted in the first quarter of FY2022 due to Covid-related circuit-breaker restrictions.

Goodwill Entertainment, which was incorporated in December 2016, operates 11 karaoke outlets in Singapore. It also runs a dance club at its Cineleisure Orchard outlet, and a live show concept with performing artistes at Bugis+.

Corporate advisory service provider Evolve Capital Advisory will be the sponsor and issue manager for Goodwill Entertainment’s potential Catalist listing. It will also be joint placement agents with Haitong International Securities. 

New IPO lows in 2024?

The potential IPOs come amid plans to revive Singapore’s equities market.

The Monetary Authority of Singapore (MAS) in August set up a new review group, chaired by Second Minister for Finance and MAS board member Chee Hong Tat, to turn things around for the local bourse.

Singapore welcomed just six new listings last year – marking SGX’s worst ever IPO showing since 1999 – down from 11 in 2022. And it could hit new lows this year.

Besides Attika Group and Goodwill Entertainment, only three other companies have lodged their preliminary offer documents so far in 2024.

Japanese restaurant operator Food Innovators in August lodged its preliminary prospectus for a Catalist listing.

Healthcare services provider LYC Medicare Singapore and wellness service provider A Wellness lodged their IPOs in March and June, respectively, but both have since withdrawn their applications.

Recent news reports have drummed up some excitement for potential listings here.

Japan-based Nippon Telegraph & Telephone (NTT) is said to be considering listing a global data centre real estate investment trust in Singapore that could raise as much as US$1 billion from the first-time share sale. 

Immersive entertainment group Neon, which is backed by Temasek’s 65 Equity Partners, is also reported to be considering a Singapore IPO that could raise as much as S$500 million.

However, both of these potential offerings will only take place in 2025 at the earliest – if at all.