KUALA LUMPUR (Nov 8): A spate of lacklustre debuts throughout October fails to dent sentiment as issuers charge ahead with their initial public offerings (IPO) while investors still want a piece of the market action.

Corporate remains keen on raising funds on Bursa Malaysia, investment bankers and advisors say, pointing to the strong pipeline of new small and large listings while IPOs already launched continue to attract strong demand from investors.

Enthusiasm for IPOs is here to stay “as there is still a lot of liquidity in the market,” said Khairi Shahrin Arief Baki, deputy chief executive officer of CGS International Securities Malaysia. “The key would be the ability to bring interesting themes and companies to the market.”

Shares of 3REN Bhd (KL:3REN) surged 41% during their debut on Wednesday while investors snapped up Metro Healthcare Bhd with the IPO shares oversubscribed by nearly 40 times, injecting some optimism into the market.

Bursa Malaysia welcomed five new companies in October and all struggled on debut, ekeing out less than 8% gain by the end of their listing days. That stood in contrast to the strong debuts of three firms a month earlier.

Steel Hawk Bhd (KL:HAWK) more than doubled its IPO price on Sept 5 followed by 99 Speed Mart Retail Holdings Bhd (KL:99SMART), the country’s largest IPO in seven years by size of proceeds, gained 14% four days later. Solar District Cooling Group Bhd (KL:SDCG) surged 33% a week later.

“Despite some concerns, three out of the five companies that IPO-ed in October are still trading above their IPO prices, indicating that the performance hasn’t been as weak as it may seem,” Affin Hwang Investment Bank institutional equity sales vice president Ho Chung Teng told The Edge.

Part of the blame is on global developments, including the US presidential election that put off foreign and domestic investors for months. Escalating geopolitical conflicts in the Middle East and uncertainties surrounding the US Federal Reserve’s next policy move still weigh on investors sentiment.

Caution is likely to prevail, said Mercury Securities head of research Toh Woo Kim. “Looking at the remaining IPO lineup for the year, there doesn't appear to be anything particularly compelling that could reignite strong investor interest,” he said.

There are still five IPOs scheduled for listing in the remaining days of the year — Mega Fortris Bhd, Azam Jaya Bhd, Life Water Bhd, Metro Healthcare Bhd, and Supreme Consolidated Resources Bhd.

All in all, Bursa Malaysia has hosted seven listings on the Main Market, 33 on ACE Market, and two LEAP Market so far this year, bringing the total to 42 new IPOs.