Trendlines slips below the line on debut

Singapore

THE trading debut of Trendlines Group, an Israeli biomed incubator, on the Catalist board may be worthy of celebration for several reasons but its shabby stock performance on Thursday belied that.

Trendlines is the 100th firm to seek a new listing on Catalist since the junior board was launched eight years ago and it also marks the first listing of an Israeli firm on SGX in a decade.

Yet, after a nothing-to-clap-about opening of 34 Singapore cents, up 3 per cent from its offer price of 33 Singapore cents, the stock ended the day underwater at 30 Singapore cents amid a weak market. Some 26.5 million shares were traded. At its best, the stock climbed nearly 8 per cent to 35.5 Singapore cents in early trade before hitting the intraday low of 30 Singapore cents after mid-day trading.

This was not the case for Jumbo Group, the most recent Catalist entrant before Trendlines which had much better luck; shares of the seafood chain owner finished 36 per cent up on its first trading day, after jumping 58 per cent at one point of the day.

"It's disappointing. I'd ascribe it to insufficient awareness of the company's business," said a market observer on Trendlines' maiden-day showing. It may have helped less that all of Trendlines' 75.76 million shares was purely a placement tranche with no "public shares".

"There was no wide net cast out there in the market for Trendlines shares," said the observer, adding that it possibly explained the lack of public understanding of the firm's business model.

Trendlines is an incubator of medical and agricultural tech firms, sectors deemed a "hot play" given its rapid advancement while M&A activities involving Israeli startups by Asian firms have fired up the scene even further. But even so, an analyst reckoned that Trendlines' earnings visibility, given the nature of its business, is unclear while early-stage firms carry the high risk-high-reward element which can be a boon or bane depending on investor appetite.

November marks a bumper month (relatively speaking) for Catalist which has hosted four new listings, three of which took place this week, making it a lively spot in an otherwise near-eventless IPO scene on the Singapore Exchange. On Monday, Malaysian property developer Astaka Holdings began trading post-reverse takeover of E2 Capital. It finished unchanged at 23.5 Singapore cents on Thursday. On Friday, another Malaysian firm Axcelasia, an integrated professional services firm, will take to the Catalist stage with a placement of 47.52 million shares at 25 Singapore cents each.