On 3 March 2016, Singapore bourse operator, SGX, included 41 listed companies into its infamous watch-list due to the implementation of the 20-cent Minimum Trading Price (MTP) rule. In all, there are 76 companies under the SGX watch-list, which is like the Hall of Shame.
To be part of this watch-list is very embarrassing because it means that affected companies have to buck up and improve their share price and financial performance. Otherwise, they face the prospect of being de-listed from the stock exchange.
The expansion of the watch-list to include companies failing to comply with the MTP rule has riled market players because this move essentially blurs the distinction between market quality and business fundamentals. To be fair, even though a company’s share price is trading below 20 cents, it does not mean that the company has shaky business fundamentals. So to put those failing to meet the MTP with those companies with financial ...
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