Thai Life shares weak in Southeast Asia's biggest IPO debut this year

(Left) Sara Lamsam, Muang Thai Life Assurance’s chief executive and a board of director at Fuchsia Venture Capital; (right) Thanapong Na Ranong, Beacon VC’s managing director. Source: Beacon Venture Capital.

Thai Life Insurance Plc (TLI) shares made a weak debut on the Bangkok stock exchange on Monday in what is Southeast Asia’s largest initial public offering (IPO) so far this year.

TLI stock rose 0.63% at the opening bell but quickly lost ground in line with the market to be flat heading into the afternoon session.

The broader market was up 0.24% by 0422 GMT.

TLI shares were priced at 16 baht, raising at least 34.4 billion baht ($937 million) from the sale of 2.3 billion shares, with about half from investors who bought before the deal went public, according to regulatory filings.

“Today’s listing will help Thai Life grow with strength and we will use the funds to improve business efficiency and service for customers,” chief executive officer Chai Chaiyawan said before the opening bell.

The volume of capital markets deals, especially IPOs, has fallen sharply in 2022 in Asia as global financial markets remain roiled by geopolitics, rising interest rates and ongoing uncertainty caused by Chinese regulatory upheaval.

Thai Life‘s flat opening was a reflection of high valuation and broader market performance, analysts said.

“This was a very weak showing for such a high profile IPO, reflecting the high IPO price and generally weak market sentiments,” said M Corp Review analyst Athaporn Arayasantiparb.

The flat debut is in line with Thailand’s listed insurance sector, which has weakened over the past month.

Share prices of major insurance stocks have fallen by about 5.3% since TLI published its revised prospectus on June 24 ahead of its IPO launch, according to Global Equity Research analyst Arun George, who publishes on Smartkarma.

Thailand’s economy was among the slowest to recover in the region, according to the latest report from the Asian Development Bank.

TLI has the third-largest market share among Thai insurers and competes with other market leaders – AIA, FWD and Muang Thai Life Assurance. It plans to use funds from the IPO to invest in digital transformation and strengthening partnerships.

TLI’s IPO is Thailand’s biggest since microfinance firm Ngern Tid Lor went public last year, raising 38 billion baht.

The insurer’s IPO has been the largest equity capital market deal in Southeast Asia in 2022, according to Refinitiv data. There were $2.45 billion worth of IPOs in the region in the first half of 2022, compared with $6.1 billion in the same period last year.


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