SET sweeping revamp of listed companies

Editorial Staff / Stocks

SET board of governors approves sweeping revamp of SET’s and mai’s listing regulations and strengthens supervision to enhance quality of listed companies

The Stock Exchange of Thailand (SET) board of governors has agreed to reposition SET and Market for Alternative Investment (mai) markets to better distinguish them and to facilitate companies with strong financial position and performance to tap into the capital market.

SET president Pakorn Peetathawatchai said that the sweeping regulatory overhaul for SET- and mai-listed companies is in line with the three-year strategic plan (2023-2025) aimed at widening fundraising opportunity for business of every size and addressing the current pain points.

The amendment will include listings of companies that have stronger financial positions and operating performance in conformity with the advent of LiVE Exchange (LiVEx) incorporated for SMEs and startups that want to grow their business, taking in to account the size and financial position of our potential companies, and competitive capabilities with foreign stock exchanges. Strengthening supervision of listed companies to enhance listed companies’ quality and to protect investors is also among the adjustments.

The regulation amendments are repositioning SET and mai by revising qualifications of companies listed on both markets, which require an increase in profitability and shareholders’ equity to reflect stronger financial health and performance.

The same minimum paid-up capital requirement for companies to be listed on both bourses is to alight with the nature of business and to maximize the use of capital market by issuers at full efficiency. In addition, requirements on free float and the public offering allocation ratio of small-sized companies will be increased to improve liquidity in the secondary market.

Stepping up oversight of listed companies including adding cases for posting “C” sign to alarm investors on companies with deteriorating financial position or operating performance as seen by low operating revenue or losses for an extended period, default on financial institutions’ loans or debt instruments, being issued disclaimer of opinion by auditors as financially-ailing companies usually come across material changes, for examples, in shareholders or business, and being targets of backdoor listing. As such, irregular trading activities may occur.

Tightening delisting, SET board of governors will delist companies that are unable to rectify all causes of delisting and resume trading within the specified period in a bid to retain only quality listed companies on the bourse. Furthermore, the stricter scrutiny on qualifications of

The aforementioned amendments are attributable to the collaboration between SET and the SEC in reinforcing supervision of listed companies throughout the process to bolster confidence and integrity of the capital market.

SET will carry out public hearing to obtain opinions about the regulation amendments before seeking an approval from the SEC’s board of directors. The announcement of the amended regulations will be made gradually by taking the appropriate time into account.