The eight companies - including Bangkok Metro Plc, Rayong Refinery Plc, and Thai Optical Group Plc - announced they would postpone their initial public offering (IPO) process, given the political situation.

Moreover, the initial share sales of 22 companies have already received approval from the securities watchdog and they are required to float their IPO shares by year-end in order to be eligible for reduced corporate income tax.

According to the Revenue Department regulations, companies that have won approval from the SEC for their initial share sales must issue shares to the public this year to receive the tax incentive of paying only 25 per cent of annual profit for five years if they list on the SET. They are subject to a 20-per-cent corporate income tax payment if they list on the Market for Alternative Investment this year

So far this year, only two companies - G Steel Plc and City Steel Plc - have made their debut on the stock market and both had a disappointing first day's trade. They closed 16.87 per cent and 2.04 per cent lower, respectively, than their offering prices.

As to how to minimise such poor debuts, Sopawadee said the authorities had no solution as yet.

Earlier, the investment bankers' club proposed that the SET widen the percentage of major shareholders' shares that should be under a "silent period", from 65 per cent to 100 per cent. A silent period is the period after an IPO during which major stakeholders cannot sell their shares.

"The SET will consider the proposal carefully as it once forced 100 per cent of major shareholders to come under the silent period before changing to the current requirement to 65 per cent," SET executive vice president Sopawadee Lertmanaschai.

Ayudhya Securities on Monday said the SET would likely fail to achieve its target of adding 100 new companies to the board this year due mainly to political uncertainty. The broker also revised downward its maximum SET Index target to 784, from 827.

Siriporn Chanjindamanee

The Nation