User Research/Opinions   

Over 60 more companies added to SGX Watchlist

Share consolidation to meet MTP at 20  cents result in huge loss in liquidity and many counters lost more market cap after doing so. So many proper companies ruined.

MTP should be set at 5 cents.



Quote from Straits Times this morning - http://www.straitstimes.com/business/companies-markets/29-companies-added-to-sgx-watch-list

When the MTP was introduced last March, 57 companies failed to meet the rule. Now, it is 66. (The other 12 making up the total 78 on the watchlist are there for failing to meet the financial criteria.)

Mr Leon Yee, a lawyer and independent director of Federal International, which was one of over 100 issuers that previously resorted to share consolidations to meet the MTP, said: " There is a mismatch between financial performance and share price performance in Singapore, because of the low liquidity of our markets.

" As the years go buy, more companies will go on the watchlist, because there is only so much liquidity to go around. Until now, the regulator is still stuck on this. The fact of the matter is it is not working out for issuers."
 

Demostation      ( Date: 05-Jun-2017 16:00) Posted: The max you can lose is $1 per 1000 shares (1 lot) without consolidation of a condemned counter.   But with consolidation the new price can be wiped down until 0.1 cent again.   This repeats again with the company planning another consolidation citing the rules of SGX.   I can see the benefits go to the shortists at SGX and the company directors who know how to scheme the scheme.   Anyone disagree, let me know. Lol..

 

The max you can lose is $1 per 1000 shares (1 lot) without consolidation of a condemned counter.   But with consolidation the new price can be wiped down until 0.1 cent again.   This repeats again with the company planning another consolidation citing the rules of SGX.   I can see the benefits go to the shortists at SGX and the company directors who know how to scheme the scheme.   Anyone disagree, let me know. Lol..

 

What is the rational for consolidation?   Afterall without consolidation, it is still tradable right.   Without consolidation the investment is safer, meaning you don' t lose more than $1 per lot should the price reach 0.01 cent.   But with consolidation, you would lose more.   This sounds very sinister.   We are geting very near to unfathomable distastefulness.   Blame who?   Why blame whom? Lol. 

 

Numerous companies placed on SGX watchlist over the weekend.

Many of these companies are not insolvent. They are placed on the watchlist due to the MINIMUM TRADING PRICE (" MTP" ) ENTRY CRITERIA and profitability issues.

• 8 Telecom
• Ace Achieve
• Asia Fashion
• A-sonic Aerospace
• ASTI Holdings
• Attilan
• Ausgroup
• Beng Kuang Marine
• BH Global
• CASA Holdings
• Chasen Holdings
• China Gaoxian
• China Great Land
• China Haida
• China Jishan
• China Sports
• China Taisan
• Compact Metal Industries
• CosmoSteel
• Dapai
• Dragon Group
• Fabchem China
• FJ Benjamin
• Foreland Fabrictech
• Forise Int
• Full Apex
• Global Yellowpages
• Hoe Leong
• Hu An Cable
• Huan Hsin
• Informatics
• Innopac
• Ipco
• Jackspeed
• Jadason
• KS Energy
• KTL Global
• Leader Environmental Tech
• Lorenzo
• Luzhoug BioChem
• M Development
• Mirach Energy
• MMP Resources
• Mun Siong Engineering
• Nex-gen Satellite Comm
• Nico Steel
• Nippecraft
• NutryFarm
• Oceanus
• Ossia
• Ouhua Energy
• Pavillon Holdings
• Plastoform
• PSL Holdings
• Qianhu
• Regal Int
• Seroja Investments
• Star Pharmaceutical
• Stratech
• Suntar Eco-City
• Swee Hong
• Travelite
• United Food Holdings
• USP Group
• VibroPower
• Ziwo Holdings

History has proven that many of the MTP companies faced massive market cap erosion upon share consolidation to meet the intangible criteria. SGX' s overall market cap will likely be affected.

http://www.sgx.com/wps/portal/sgxweb/home/company_disclosure/watchlist