SET targets Singapore’s market cap
The Stock Exchange of Thailand (SET) aims for its market capitalisation to equal that of the Singapore Exchange by 2023 as its seeks sustainable growth through initial public offerings (IPOs) and new products.
The Thai bourse will also focus on increasing market competitiveness by creating a partnership platform to prepare for demographic and technological changes, said SET president Pakorn Peetathawatchai.
Mr Pakorn took the helm last Friday, replacing Kesara Manchusree, whose tenure ended on May 31. The SET president’s term runs for four years.
The SET yesterday hosted a media briefing for Mr Pakorn to highlight his strategic development campaign, “Creating a Partnership Platform to Drive Inclusive Growth”.
Under the plan, the bourse plans to increase market cap by 250 billion baht each year, with new capital deriving from IPOs, innovative products and other securities, Mr Pakorn said.
The exchange’s market cap reached US$350 billion baht (11.2 trillion baht) five years ago, compared with the Singapore Exchange’s $700 billion at the time.
Since then, the SET’s market cap has risen to $550 billion, remaining below the Singapore Exchange’s current market cap of $800 billion.
“The SET’s market capitalisation has an average increase of 250 billion baht each year,” Mr Pakorn said. “If we can keep this growth ratio, the bourse has a chance of beating the Singapore Exchange.”
While acknowledging the challenge of equalling the Singapore Exchange’s market cap by 2023, the new president said the SET has strategies in place to achieve such
an ambition.
Key development areas that the bourse will focus on include increasing advanced analytics tools, initiating end-to-end customer solutions, partnering with fintech companies, focusing on wealth management and life-path investment, increasing new products and services from customer insight through big data, strengthening risk management and developing suitable infrastructure for Thai startups and the country’s connectivity, Mr Pakorn said.
Besides beefing up the SET’s market cap, the exchange plans to adopt new technological platforms to boost its operational strength, he said.
Deputy Prime Minister Somkid Jatusripitak said the SET’s market cap has a good chance to reach par with the Singapore Exchange’s level because the former has grown by 20-30% a year, while the latter’s growth is about 10% annually.
The Thai bourse’s market cap rose by 4 trillion baht over the past four years, with the benefits disseminating to the overall economy apart from enhancing investors’ wealth, Mr Somkid said.
“A 300-point rise in the stock market contributes to improved consumer spending, while Thailand’s GDP value increased to 2 trillion baht over the past four years,” he said. “We have to strengthen Thai companies further, especially startups which are deemed to be a new engine of growth driving the economy forward.”