Singapore retail market is underpenetrated: SGX

Singapore has only 350,000 active Central Depository accounts out of a resident population of 3.79m.

According to Maybank Kim Eng's recent discussions with the management of Singapore Exchange, the bourse is putting a lot of effort into the retail market segment in a bid to grow this slice of the pie, whose latent potential is hard to ignore. Maybank is positive on this development as it reinforces our argument that SGX has structural growth potential.

Here's more from Maybank:

Huge potential beckons. SGX’s internal studies show that despite Singapore’s reputation as a financial hub, its retail market is underpenetrated compared to its regional peers. The Republic has only 350,000 active Central Depository (CDP) accounts out of a resident population of 3.79m. This penetration rate of about 9% pales in comparison to Hong Kong’s 35% and Australia’s 43%, not to mention that Singapore has a higher GDP per capita than the two markets.

Impact of similar penetration. We estimate that about 18% of the current SDAV is generated by retail clients (based on the assumption that one-third of the 55% trading value from contract sizes less than S$1.5m is from retail clients). Our sensitivity analysis shows that SDAV should be at least S$2.1b today if local retail participation matches Hong Kong’s. This is excluding the knock-on effect of greater market buoyancy. In this scenario, the bottomline for SGX may hit S$390m.

Property curbs, casino fatigue will benefit SGX. Anecdotal evidence suggests that poor retail participation over the past 24 months may be partly attributable to more investments into real estate and the “casino effect”. However, with more property curbs being rolled out and the novelty of the two new casinos (which opened around mid-2010) wearing off, we think SGX may get more traction in its retail initiatives going forward. In turn, this will benefit SDAV.

If you've been wondering whether SBR could work for your company — yes, probably.

A lot of the companies we partner with started as readers. They'd been following our coverage for a while, saw their own customers and competitors in it, and eventually asked the obvious question: could we do something with you? The answer is usually yes. The shape of it depends on what you're trying to do.

The options are broader than most people assume — thought leadership articles, sponsored content, industry summits across Southeast Asia, regional awards programmes, podcasts, and media placements in print and digital. Some partners use one channel; most use a mix. We figure out the right combination by starting with your brief, not with our rate card.

So if the question has been on your mind, here's the easy way to ask it.

We'll tell you honestly whether we can help, and how. It's a better use of everyone's time.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia