b) CHANGING MESDAQ
3) OPEN THE BOND MARKET'S APPROVAL STRUCTUR
4) THE GOVERNMENT APPROVED A THIRD CREDIT RATING AGENCY
THE CURRENT LISTING REQUIREMENT IN
PAID UP CAPITAL | PROFIT RECORD | |
MAIN BOARD | 60 MILLION | 5 YEARS |
SECOND BOARD | 40 MILLION | 3 YEARS |
MESDAQ | 2 MILLION TO 20 MILLION | OPERATED FOR 3 YEARS |
TOPIC BACKGROUND:
THE PRIME MINISTER ANNOUNCED A MERGED BOARD， THE MERGING OF THE MAIN BOARD AND SECOND BOARD。 THE MARKET OPINION IS DIVIDED。
THE MERGING OF SECOND BOARD AND MAIN BOARD CREATED A SENARIO THAT HAVE A MIXTURE OF THE BOARD， IN SHORT TERM IT WILL AFFECT THE OVERALL EVALUATION OF MALAYSIA SHARE MARKET， BUT THIS IS THE TREND OF GLOBAL STOCK EXCHANGE MARKET， IN THE LONG RUN， IT DEPENDS ON THE SUPERVISING AUTHORITIES ’ PLANNING， EXECUTION AND MONITORING。
MARKET ARE SAYING THAT THE MERGING IS A BACKWARD MEASURES， FROM THIS YEAR， THE FOCUS ON THE LIQUIDITY TO CAPITAL FORMATION， BUT THE GOOD SIDE OF IT IS THAT IT LOWER THE LISTING REQUIREMENTS BUT AT THE SAME TIME， THE COMPANIES THAT DON ‘T FULFILL THE LISTING REQUIREMENTS WILL BE KICK OUT EVEN FASTER。
THE GOOD | THE BAD |
1。MERGING MEASURE WILL MODERATELY AFFECT THE INSTITUTIONAL INVESTMENT， IN LONG TERM， IT WILL LET FUND MANGERS TO BE MORE FLEXIBLE IN INVESTING， HAVING MORE CHOICES ON MEDIUM AND SMALL CAPITAL TO DEVELOPING COMPANY -THE SECOND BOARD ’S QUALITY IS BETTER THAN PREVIOUSLY， BASED ON THE | 1。SECOND BOARD AND MESDAQ ’S MERGING CONCEPT IS MORE PRACTICAL。REASON BEING MAIN BOARD AND MESDAQ HAS COMMON POINT: a) INDIVIDUAL SHARE ‘S FACE VALUE ARE LESS ATTRACTIVE b) MARKET VALUE VARIES RAPIDLY BUT UNABLE TO REFLECT THE ACTUAL VALUE。 c) LACK OF LIQUIDITY d) LACK OF |
2。A PORTION OF ESTATE MANAGEMENT OR TRUST FUND COMPANIES MAY ADJUST THE CURRENT INVESTMENT STRATEGIES。 (A) CURRENTLY MOST OPERATORS FIXED RULE TO INVEST ONLY ON MAIN BOARD NOT ON SECOND BOARD AND MESDAQ SHARES。 (B) THE FUND MANAGERS ARE PRACTICAL， THEIR AIMS ARE FOR THE COMPANIES ’ PROFIT THE POTENTIAL ON GROWTH， AS LONG AS THE COMBINATION OF INVESTMENT BRING PROFITS， MAIN BOARD OR SECOND BOARD DOESN ‘T MATTER。 (C) BLUE CHIP : RESULT GUARANTEE/ SLOW IN GROWTH (D) 2ND AND 3RD LINE SHARES ’ POINT: STRONG GROWTH /THERE MAY BE GOOD SHARES WHICH WERE OVERLOOKED FOR A LONG TIME | 2。MESDAQ LISTING REQUIREMENT IS GETTING STRICTER BY THE DAYS， DISTANCE FROM THE ORIGINAL GOAL TO HELP CREATIVE COMPANIES TO GATHER FUNDS， AND MERGING WITH THE SECOND BOARD IS MUCH MORE PRACTICAL。 |
3。THE MERGED BOARD WILL STRESS MORE ON QUALITY AND KEEPING ONLY THE GOOD SHARES; THE NUMBERS OF LISTING COMPANIES WILL NO LONGER MATTERS (BY STRICT MONITORING, LISTING REQUIREMENTS AND REWARDS, PROMOTES THE LISTING COMPANIES’ QUALITY WHICH WILL HELP TO ATTRACT INVESTORS) | 3。SECOND BOARD’S OVERALL RESULT ARE BELOW EXPECTATION, MERGING MAY CAUSE THE END RESULTS TO BE UNSATISFACTORY (EVEN THOUGH THE MAIN BOARD ALSO HAS SOME BAD SHARES, BUT THE OVERALL PERFORMANCE IS STILL A LOT BETTER THAN THE SECOND BOARD ) |
4。MANY PEOPLE BELIEVE THAN THE SHARE PRICES MAY READJUST, INCLUDING THE 100 MAIN SHARES THAT WILL BE RESTRUCTURE, TO ACCOMMODATE THE SHARES IN THE SECOND BOARD AND MAIN BOARD SHARES, AT THE SAME TIME DELIST THE LOW LIQUIDITY MAIN BOARD SHAREHOLDES, TO REFLECT THE TRUE COLOR OF THE MERGING. | 4。INDIVIDUAL SHAREHOLDERS WILL HAVE HARDTIME CHOSING SHARES TO INVEST, ESPECIALLY THOSE WHO BASED ON HEARSAY WITHOUT DOING THEIR HOMEWORKS. (FUND MANAGERS HAVE RESEARCH DEPARTMENT’S SUPPORT, CHOSING SHARES TO INVEST AFTER MERGING SHOULD NOT BE A PROBLEM |
5。OTHER POSIBILITIES INCLUDES THE PRICES: a)OR EXPAND THE TYPES OF SHARES b)OR BASED ON MAIN BOARD, SECOND BOARD AND MESDAQ’S COMPANIES NUMBERS (OR CAPITAL VALUES) RATIO, TO RESTRUCTURE AND FIXED. | 5。FUND MANAGERS WHO LOCKED TO THE PRICES WILL FACE PROBLEMS AT FIRST (SOME FUNDS WHCH FOCUS ON PRICE, MAY NEED TO READJUST THE INVESTMENT PACKAGE, BUT THE EFFECT OF MERGING DEPENDS ON THE NEW SHARE PRICES AFTER THE MERGE. |
RELATED TOPICS
WHY MAIN BOARD AND SECOND BOARD MERGE？
- FOREIGN CAPITALIST SELDOM INVEST MUCH IN
- IN MARKET CAPITAL *，BURSA
- IN TERMS OF PROFITS，SMALL SHARE MARKET MAY NOT GIVE THE RETURN AS THE BIG INVESTORS WISH, AS THE LIQUIDITY OF THE SHARE MARKET ARE LOW。
- MALAYSIA CURRENTLY HAS MORE THAN ONE THOUSAND COMPANIES LISTED IN THE BURSA MALAYSIA，ITS AMOUNT ARE SIMILAR TO THE ONE IN HONG KONG SHARE MARKET, BUT THE MARKET CAPITAL OF HONG KONG SHARE MARKETS ARE 8 TIMES THE SIZE OF OURS. IN ANOTHER WORD, OUR COUNTRY HAS TOO MANY SMALL CAPITAL LISTING COMPANIES。
- IT IS THE IMPRESSION OF THE INVESTORS THAT GOOD COMPANIES WILL BE MOVED TO THE MAIN BOARD AND THAT THE LISTED COMPANIES IN THE SECOND BOARD ARE THOSE THAT IS NOT SUCCESSFUL. THE END RESULT IS LACK OF LIQUIDITY IN THE SECOND BOARD THEREBY WORSEN THE SECOND BOARD CONDITION.
THE SITUATION IN
** | TYPES OF | REGISTERED IN | VENUE OF LISTING | TRADE CURRENCY |
1。 | A | REN MIN BI | ||
2。 | B | USD/ | ||
TYPES OF | REGISTERED IN | VENUE OF LISTING | TRADE CURRENCY | |
3。 | H | |||
4。 | RED CHIP SHARES | |||
TYPE OF OVERSEAS SHARES | REGISTERED IN | VENUE OF LISTING | TRADE CURRENCY | |
5。 | ||||
6。 | USD | |||
**
1。70% INDIVIDUAL INVESTORS, ONLY FOR
AND QFII TO TRADE
2。ALLOW FOREIGN INVESTORS TO TRADE
3。LIMITED TO INTERNATIONAL FINANCIAL INSTITUTIONS TO TRADE
4。
THE REST ARE FOR INTERNATIONAL INVESTORS
ADDITIONAL TOPIC:
MESDAQ WILL BE REVAMP, TO ALLOW SMALLER COMPANIES TO BE LISTED MUCH EARLIER AFTER FORMATION。
- THE SPONSORSHIP MECHANISM, THE EFFECT IN THE LONG RUN IS POSITIVE.:
a) THE RELEVANT AUTHORITIES REQUIRED THAT THE RELATED COMPANIES HAVE LONG TERM CAPITAL TO INVEST, AND MAKE SURE THE RELATED COMPANIES HAVE GOOD POTENTIAL TO GROWTH AND GOOD MANAGEMENT FORMULA。
b)THE SPONSORSHIP MECHANISM MAY EXPAND THE TYPES OF MESDAQ SHARES，NO LONGER LIMITED TO TECHNOLOGY RELATED SHARES, IF THE MODE OF OPERATION ARE HEALTHY/PROSPECT OF GROWTH IS GOOD。
NOTE ：
* SMALL CAP - MARKET CAPITAL LES THAN 1 BILLION
MID-CAP - MARKET CAPITAL MORE THAN 1 BILLION, LESS
THAN 5 BILLION
LARGE-CAP- MARKET CAPITAL MORE THAN 5 BILLION
RESOURCES：
1。 SIN CHEW DAILY
2。 BIZWEEK
3。 MALAYSIA-FINANCEBLOGSPOT
Forum (1) "THE MERGING OF MAIN BOARD AND SECOND BOARD OF BURSA MALAYSIA"
DATE：31 May 2008
TIME：8：00PM - 10：30PM
VENUE：Puchong, Selangor
MODERATOR：LO YU CHONG
RECORDER：TAN CHUN MING
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