SGX Hit By Record Slow-Down In December Trading Volume
Trading activity on the Singapore Exchange (SGX) hit a trough as persistent issues such as the eurozone crisis and the global economy slowdown caused investors to shy away from risky assets. Data released by the SGX showed that total securities market turnover plunged 40% in December from a year ago to 15.1 billion shares, while the value of trades done during the month dropped 41% to $16.7 billion. On an average daily basis, the figures translate into a daily trading volume of 719 million shares, 35% lower than a year ago. Chinese companies continued to see sharp drops in trading activity. Only 2 billion S-chips were traded during the month, 70% lower than a year ago as scandals involving China-based, Singapore listed corporations continued to rattle investor sentiments.
Significance: SGX which relies on trading as a means of revenue, could face a dip in its 1H12 takings as fee revenue declines. The drop in trading volumes could also present additional problems to SGX as prospective companies look to defer listing through IPOs.
Private Equity Group To Boost TTI’s Big Box
Singapore-based private equity group Lucrum Capital (Lucrum) has agreed to boost the Big Box project by TT International (TTI) by injecting at least $200 million. The proposed capital injection could help revive the stalled warehouse and retail project in Jurong East. Under the proposed deal, TTI’s interest in the project will be transferred to a wholly owned subsidiary in which Lucrum will have the option of acquiring up to 49% stake in. TTI was first granted approval for the Big Box project under the government’s Warehouse Retail Scheme (WRS). But after initially ploughing $95 million into the project, TTI ran out of funds to continue with the project when the 2008 financial crisis hit. It has been on a search for prospective project partners ever since. The eight-storey development will have a gross floor area of about 1.3 million square feet and house retail services, including consumer electronic products, furniture and a hypermarket.
Significance: Ostensibly, the capital injection by Lucrum Capital will help revive the long-stalled Big Box project by TTI. However, the proposal is still subject to approvals from the relevant authorities, scheme creditors and shareholders. Both sides are currently committed to “striking a balance” between achieving commercial interests and fulfilling regulatory compliance.
Yoma Poised To Develop Land In Myanmar
Yoma Strategic Holdings (Yoma) has announced plans to acquire the land development rights of a 54-hectare area in Myanmar. In statements released on 4 January, Yoma said that it was pursuing previously secured “first right of refusal” for land development rights related to Star City – about 9.6km away from Myanmar’s former capital, Yangon. While the terms of the acquisition have not yet been agreed upon, Yoma felt that an opportune time had presented itself to pursue its rights. Yoma said that the plan was for Star City to comprise more than 9,000 units of apartments and houses, shopping and commercial areas, with residential units targeted at the growing middle-class population in Myanmar. Yoma’s principal activities include the development of land, the sale of private residential properties, construction, as well as design and project management for real estate developments in Myanmar and China.
Significance: Analysts remark that Yoma’s share price had rose more than 3 times from a low of $0.07, 3 months ago to its current share price of $0.23. It is evident that investors are increasingly showing interest and optimism in Yoma’s outlook and prospects.