Weak share prices land 41 companies in SGX watch-list

They have three years to get their act together.

A total of 41 Mainboard companies are on thin ice after failing to meet the Singapore Exchange (SGX)’s minimum trading price (MTP) requirement.

According to the local bourse, two companies will also be added to the list because they triggered the financial entry criteria.

SGX asserts that prior to 3 March 2016, there were 33 companies already on the watch-list because they had triggered the financial entry criteria. Of these, 16 did not fulfil the MTP requirement.

The companies on the watch-list from 3 March 2016 have 3 years to roll out share price-boosting measures if they are non-compliant with MTP, or improve their financial performance if they triggered the financial entry criteria.

“Putting these companies on a watch-list increases transparency for investors, enabling them to more easily monitor the companies they have invested in,” comments June Sim, SGX’s head of Listing Compliance.

Sim adds: “Since the introduction of the watch-list effective March 2008, a significant number of companies were able to improve their financial performance and exit the watch-list.”

SGX further reports that the companies will be reviewed for MTP compliance on 1 September 2016, as the companies are new entrants; have been granted an extension after a consultation with the bourse; and have completed share consolidation before 1 March 2016 and have 6-month VWAP below below $0.20.

Meanwhile, the financial entry criteria require pre-tax losses for the three most recently consecutive financial years; and an average daily market capitalisation of less than $40m over the last six months.