Sat, Dec 30, 2006 - Page 12 News List

TSEC aiming for 25 new listings next year

HIGH HOPES The stock exchange hopes to fight competition from Hong Kong and said it hoped the government would loosen regulations to attract unlisted companies

By Jason Tan  /  STAFF REPORTER

In a bid to further revitalize the stock market, the Taiwan Stock Exchange Corp (TSEC) yesterday said it was aiming to lure 25 companies to join the main bourse next year.

"We intend to invite international capital and to attract more companies to list on the stock exchange by offering a highly efficient, low-cost and internationally competitive platform," TSEC chairman Gordon Chen (陳樹) told reporters at a year-end press conference yesterday.

The total number of listing firms this year shrank to 688 firms, as 13 companies had de-listed as a result of merger and acquisition activities, which offset the number of newly listed firms -- 10 -- throughout the year, he said.

Last year, 691 companies were listed on the main bourse, already six companies fewer than the number in 2004.

The stock exchange is facing stiff competition from its Hong Kong counterpart, as local businesses increasing choose to launch initial public offerings (IPOs) to bypass the government's investment rules for China, Taiwan's largest investment destination.

The Cabinet in September introduced a plan to beef up the financial market, aiming to attract 250 companies to list on the local stock markets within the next three years.

Of that amount, it is expected that 90 companies will make IPOs with TSEC, while the rest will go to GRETAI Securities Market -- the nation's over-the-counter market.

GRETAI is the nation's biggest exchange for bonds and has 530 listed firms currently.

Chen is also planning to boost the stock exchange's daily turnover to over NT$100 billion (US$3.06 billion) next year.

The average daily turnover this year was NT$96.3 billion, up from last year's NT$76.2 billion, statistics from TSEC showed.

The price-earnings ratio (P/E ratio), meanwhile, was 18.76, compared with 17.55 last year.

The ratio measures corporate earnings power and is used by investors to gauge market demand for stocks, with a higher number indicating higher demand.

Chen said TSEC was also communicating with the government to loosen regulations to attract Taiwanese firms that are not registered locally to launch IPOs.

Currently, there are over 1,000 local enterprises registered in the Cayman Islands and Bermuda, with some 200 to 300 of them being potential candidates for a local listing, he said.

Other measures to be taken include slashing the paid-in capital prerequisite for IPOs to NT$300 million, from the current NT$600 million, as well as luring state-run firms such as Bank of Taiwan (台灣銀行) and Land Bank of Taiwan (土地銀行) for public listings, the TSEC said earlier.

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