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Singapore’s equity market gains raise bar for new IPOs: OCBC

Published July 7, 2026 at 2:53 AM UTC

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Singapore's equity market has experienced significant gains, leading to a revaluation of existing stocks and setting a higher benchmark for new initial public offerings (IPOs). The S$6.5 billion Equity Market Development Programme (EQDP), implemented in February 2025, has played a pivotal role in strengthening the capital market, making investors more discerning when considering new listings. Carmen Lee, Head of Equity Research at OCBC, highlighted that for new IPOs to attract investor interest, they must offer either a substantial valuation discount or a compelling growth narrative. She emphasized that companies aiming to list at market prices without delivering significant earnings growth may find it challenging to justify their valuations. Despite this, Lee anticipates a broader pipeline of IPOs in the latter half of the year, particularly from sectors that are considered more attractive to investors. She also noted ongoing efforts to diversify the IPO landscape by attracting more overseas listings, moving beyond the traditional base of domestic companies. However, the current IPO pipeline has yet to translate into stronger post-listing performance, with several companies debuting in the first half of the year, such as JustCo, experiencing lackluster share price returns. In light of these developments, OCBC maintains an overweight stance on Singapore equities for the second half of 2026, citing attractive valuations that remain undemanding despite recent gains. The bank also expects Singapore equities to continue standing out for their defensive characteristics and the strength of the Singapore dollar amid ongoing macroeconomic uncertainties. OCBC's research team remains positive on industrial stocks, noting that many companies in the sector are well-positioned to benefit from long-term secular growth trends. They also highlighted positive developments emerging from the Middle East as supportive of the sector. Additionally, OCBC's research team identified 15 preferred Singapore stocks for the second half of 2026, spanning various sectors, including real estate, consumer, healthcare, and industrials. These selections aim to capture a diverse mix of industries, with a particular emphasis on healthcare as a key structural theme. Overall, while the strengthened equity market presents challenges for new IPOs, it also offers opportunities for investors to engage with a more dynamic and diversified market landscape.