SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Equity Bottom-Up

<ul>
<li>Audience Analytics made its debut on the SGX Catalist today. Established in 2002, the Group offers a range of solutions that allows companies to better understand their businesses, in order to make more effective business decisions. &nbsp;</li>
<li>Based on its audited combined financial statements, net profit grew by a CAGR of 17.5% from S$2.1 million in FY2018 to S$2.9 million in FY2020. The Group saw an increase in gross profit margin from 46.5% in FY2018 to 65.7% in FY2020, while total revenue grew from S$7.2 million in FY2018 to S$7.6 million in FY2020. &nbsp;</li>
<li>Although the Group currently does not have a fixed dividend policy, the Directors intend to recommend and distribute dividends of 50.0% of the profit attributable to equity holders of the Company in respect of FY2021 and FY2022.&nbsp;</li>
</ul>
&nbsp;
Established in 2002, the Group helps businesses in multiple sectors better understand their businesses, make better decisions, promote their businesses, and partner with them for growth. It offers a range of solutions via a wide portfolio of awards, exhibitions, conferences, digital and print media and business analytics. While the Group’s main office is located in Malaysia, it now conducts business activities in Cambodia, Hong Kong, India, Indonesia, Macau, Malaysia, Philippines, PRC, Singapore, South Korea, Taiwan, Thailand, and Vietnam. Highlights of the IPO based on Offer Document (click <a href="https://api2.sgx.com/sites/default/files/2021-09/Optimus%20Prime_Final%20Offer%20Document_Clean.pdf" target="_blank" rel="noopener">here</a>) 1. Business Segments 
 Audience Analytics derives its revenue from four business segments: 
<ul>
<li>Business Impact Assessment and Recognition – Conducts business impact assessments on companies to assess their eligibility to participate in the business recognition awards organised by Audience Analytics. Such awards include SME100 Awards, HR Asia Award and the Golden Bull Award.</li>
<li>Exhibitions – Organises large-scale exhibitions including but not limited to Malaysia Career &amp; Training Fair, Mega Career Fair and Post Graduate Fair.</li>
<li>Business Media – Offers business media services such as B2B digital and print business media brands which provide informative and timely intelligence for business professionals across Asia. It offers a comprehensive range of business media solutions to its customers through the Group’s Digital Platforms and print publications (such as online portals and print publications of SME Magazine, HR Asia, and Capital Asia), as well as organising networking events and conferences.</li>
<li>Business Intelligence and Growth Analytics – A new segment offered via a Software as a Service (SaaS) model which include the use of the Group’s proprietary ‘Total Engagement Assessment Model’ (TEAM) software to provide accurate and timely data to HR professionals to better understand their workforce.</li>
</ul>
<figure class="editor-figure mceNonEditable"><img src="https://api2.sgx.com/sites/default/files/2021-09/Capture_7.PNG" class="editor-image img-responsive"></figure>
<div class="content-caption">Business Segment by Revenue</div>

2.&nbsp;Key Business Strategies (Please refer to Page 124 of the offer document for a complete list of business strategies and future plans) Enhancing business analytics capabilities
<ul>
<li>To incorporate AI technology, including predictive analytics and ML into the TEAM methodology. AI technology will be used to analyse big data collected from various HR activities such as employee acquisition, attendance, performance management, engagement, training, and compensation to develop tools and enhance TEAM product.</li>
<li>To introduce a new business assessment and analytics product, Velocity. This real-time analytic tool will generate a set of performance metrics which will provide a global view of customer experience performance, identify choke points and take effective corrective measures to enhance customer experience.</li>
</ul>
Expansion into new geographic markets, industry verticals and functional specialisations 
<ul>
<li>To replicate the success of the HR Asia Awards in new markets in Asia, for SME100 Awards, Golden Bull Award, EA Awards and CXP Awards.</li>
<li>To introduce new awards within and outside existing industry verticals and functional specialisations, while progressively laying out brand extensions of existing and new awards into other markets.</li>
</ul>
Digitalisation of existing business operations to tap new growth channels
<ul>
<li>To fully digitise the B2B media products, notably the publications, which will enable the Group to grow its subscriber base.</li>
<li>A paywall will be established to allow third party contributors to publish their content on the Group’s Digital Platforms.</li>
<li>To expand the mode of delivery of B2B media products from static print or digital media to more mediums such as podcasts which will be accessible on mobile devices, or which can be sold or distributed via mobile applications and other third party sites.</li>
</ul>
3.&nbsp;Competitive strengths (Please refer to Page 122 of the offer document for a complete list of competitive strengths)
<ul>
<li>Established track record and strong market reputation – With more than 10 years of experience across Business Impact Assessment and Recognition Segment, Exhibitions Segment and Business Media Segment, Audience Analytics can capitalise on its vast knowledge of organising events and keeping up with changing demands. The Group has been able to secure prestigious speakers and participants, and attract Fortune 500 companies for it’s awards<s>.</s></li>
<li>Diverse range of products caters to evolving needs across different growth stages of customers – Ability to support customers across different stages of business growth cycles with products that can assist them in branding, marketing and promotions, talent acquisition, retention and development, business process improvement and market intelligence.</li>
<li>Scalable and asset-light business model – Ability to adapt quickly to market conditions through scaling its operations, increasing product offerings or expanding geographical coverage, without material capital commitments.</li>
</ul>
4. Key Risks&nbsp;(Please refer to Page 40 of the offer document for a complete list of risk factors)
<ul>
<li>Exposure to risks of outbreaks of communicable diseases such as COVID-19 – Lockdown measures introduced due to the COVID-19 pandemic affected the success of physical events which led to the decline in revenue. The Group is unable to assure that we would be able to maintain costs and not incur additional costs due to the change in operations resulting from COVID-19 in the future. &nbsp;</li>
<li>Changes to terms and termination of licenses – Revenue contributed from licenses amounted to approximately 35.4% and 37.2% of the Group’s revenue in FY2019 and FY2020 respectively. Should there be any pre-mature termination or non-renewal of licenses, operations and financial performance may be adversely affected. &nbsp;</li>
<li>Dependent on the reputation of its brands – Maintaining brand reputation is essential to preserve the Group’s existing customer base as well as to attract new customers. Negative comments or publicity about its awards, business operations or management, may adversely impact business and financial performance.</li>
</ul>
 Financials &amp; Valuation
<ul>
<li>Based on its audited financial statements, net profit grew by a CAGR of 17.5% from S$2.1 million in FY2018 to S$2.9 million in FY2020. The Group saw an increase in gross profit margin from 46.5% in FY2018 to 65.7% in FY2020, while total revenue grew from S$7.2 million in FY2018 to S$7.6 million in FY2020.</li>
<li>According to the Offer Document, Audience Analytics’ post-placement earnings per share (EPS) is 1.75 Singapore cents based on the audited FY2020 income statement. With a Placement Price of S$0.30, the price-to-earnings (P/E) ratio is 17x for FY2020.</li>
<li>Although the Group currently does not have a fixed dividend policy, the Directors intend to recommend and distribute dividends of 50.0% of profit attributable to equity holders in respect of FY2021 and FY2022.</li>
</ul>
<figure class="editor-figure mceNonEditable"><img src="https://api2.sgx.com/sites/default/files/2021-09/Capture_8.PNG" class="editor-image img-responsive"></figure>
<div class="content-caption">Financial Performance</div>

Additional Information from Offer Document (click <a href="https://api2.sgx.com/sites/default/files/2021-09/Optimus%20Prime_Final%20Offer%20Document_Clean.pdf" target="_blank" rel="noopener">here</a>)
IPO Details
<ul>
<li>Placement price at S$0.30 per Placement Share</li>
<li>Placement of 26.0 million Placement Shares
<ul>
<li>18.2 million New Shares</li>
<li>7.8 million Vendor Shares</li>
</ul>
</li>
<li>Estimated IPO Market Capitalisation of S$50.46 million based on post-Placement share capital of 168.2 million Shares.</li>
<li>Net proceeds from placement approximately S$6.39 million</li>
<li>Use of net proceeds:
<ul>
<li>S$0.5 million – Development of the Group’s Business Intelligence and Growth Analytics Segment</li>
<li>S$0.5 million – Expansion into new geographic markets, new industry verticals and functional specialisations</li>
<li>S$0.5 million – Digitalisation of existing business operations</li>
<li>S$2.6 million – General working capital purposes&nbsp;</li>
</ul>
</li>
</ul>


Audience Analytics made its debut on the SGX Catalist today. Established in 2002, the Group offers a range of solutions that allows companies to better understand their businesses, in order to make more effective business decisions. &nbsp;
Based on its audited combined financial statements, net profit grew by a CAGR of 17.5% from S$2.1 million in FY2018 to S$2.9 million in FY2020. The Group saw an increase in gross profit margin from 46.5% in FY2018 to 65.7% in FY2020, while total revenue grew from S$7.2 million in FY2018 to S$7.6 million in FY2020. &nbsp;
Although the Group currently does not have a fixed dividend policy, the Directors intend to recommend and distribute dividends of 50.0% of the profit attributable to equity holders of the Company in respect of FY2021 and FY2022.&nbsp;

&nbsp;
Established in 2002, the Group helps businesses in multiple sectors better understand their businesses, make better decisions, promote their businesses, and partner with them for growth. It offers a range of solutions via a wide portfolio of awards, exhibitions, conferences, digital and print media and business analytics.  While the Group’s main office is located in Malaysia, it now conducts business activities in Cambodia, Hong Kong, India, Indonesia, Macau, Malaysia, Philippines, PRC, Singapore, South Korea, Taiwan, Thailand, and Vietnam.  Highlights of the IPO based on Offer Document (click here)  1. Business Segments 
 Audience Analytics derives its revenue from four business segments: 

Business Impact Assessment and Recognition – Conducts business impact assessments on companies to assess their eligibility to participate in the business recognition awards organised by Audience Analytics. Such awards include SME100 Awards, HR Asia Award and the Golden Bull Award.
Exhibitions – Organises large-scale exhibitions including but not limited to Malaysia Career &amp; Training Fair, Mega Career Fair and Post Graduate Fair.
Business Media – Offers business media services such as B2B digital and print business media brands which provide informative and timely intelligence for business professionals across Asia. It offers a comprehensive range of business media solutions to its customers through the Group’s Digital Platforms and print publications (such as online portals and print publications of SME Magazine, HR Asia, and Capital Asia), as well as organising networking events and conferences.
Business Intelligence and Growth Analytics – A new segment offered via a Software as a Service (SaaS) model which include the use of the Group’s proprietary ‘Total Engagement Assessment Model’ (TEAM) software to provide accurate and timely data to HR professionals to better understand their workforce.


Business Segment by Revenue

2.&nbsp;Key Business Strategies (Please refer to Page 124 of the offer document for a complete list of business strategies and future plans)  Enhancing business analytics capabilities

To incorporate AI technology, including predictive analytics and ML into the TEAM methodology. AI technology will be used to analyse big data collected from various HR activities such as employee acquisition, attendance, performance management, engagement, training, and compensation to develop tools and enhance TEAM product.
To introduce a new business assessment and analytics product, Velocity. This real-time analytic tool will generate a set of performance metrics which will provide a global view of customer experience performance, identify choke points and take effective corrective measures to enhance customer experience.

Expansion into new geographic markets, industry verticals and functional specialisations 

To replicate the success of the HR Asia Awards in new markets in Asia, for SME100 Awards, Golden Bull Award, EA Awards and CXP Awards.
To introduce new awards within and outside existing industry verticals and functional specialisations, while progressively laying out brand extensions of existing and new awards into other markets.

Digitalisation of existing business operations to tap new growth channels

To fully digitise the B2B media products, notably the publications, which will enable the Group to grow its subscriber base.
A paywall will be established to allow third party contributors to publish their content on the Group’s Digital Platforms.
To expand the mode of delivery of B2B media products from static print or digital media to more mediums such as podcasts which will be accessible on mobile devices, or which can be sold or distributed via mobile applications and other third party sites.

3.&nbsp;Competitive strengths (Please refer to Page 122 of the offer document for a complete list of competitive strengths)

Established track record and strong market reputation – With more than 10 years of experience across Business Impact Assessment and Recognition Segment, Exhibitions Segment and Business Media Segment, Audience Analytics can capitalise on its vast knowledge of organising events and keeping up with changing demands. The Group has been able to secure prestigious speakers and participants, and attract Fortune 500 companies for it’s awards.
Diverse range of products caters to evolving needs across different growth stages of customers – Ability to support customers across different stages of business growth cycles with products that can assist them in branding, marketing and promotions, talent acquisition, retention and development, business process improvement and market intelligence.
Scalable and asset-light business model – Ability to adapt quickly to market conditions through scaling its operations, increasing product offerings or expanding geographical coverage, without material capital commitments.

4. Key Risks&nbsp;(Please refer to Page 40 of the offer document for a complete list of risk factors)

Exposure to risks of outbreaks of communicable diseases such as COVID-19 – Lockdown measures introduced due to the COVID-19 pandemic affected the success of physical events which led to the decline in revenue. The Group is unable to assure that we would be able to maintain costs and not incur additional costs due to the change in operations resulting from COVID-19 in the future. &nbsp;
Changes to terms and termination of licenses – Revenue contributed from licenses amounted to approximately 35.4% and 37.2% of the Group’s revenue in FY2019 and FY2020 respectively. Should there be any pre-mature termination or non-renewal of licenses, operations and financial performance may be adversely affected. &nbsp;
Dependent on the reputation of its brands – Maintaining brand reputation is essential to preserve the Group’s existing customer base as well as to attract new customers. Negative comments or publicity about its awards, business operations or management, may adversely impact business and financial performance.

 Financials &amp; Valuation

Based on its audited financial statements, net profit grew by a CAGR of 17.5% from S$2.1 million in FY2018 to S$2.9 million in FY2020. The Group saw an increase in gross profit margin from 46.5% in FY2018 to 65.7% in FY2020, while total revenue grew from S$7.2 million in FY2018 to S$7.6 million in FY2020.
According to the Offer Document, Audience Analytics’ post-placement earnings per share (EPS) is 1.75 Singapore cents based on the audited FY2020 income statement. With a Placement Price of S$0.30, the price-to-earnings (P/E) ratio is 17x for FY2020.
Although the Group currently does not have a fixed dividend policy, the Directors intend to recommend and distribute dividends of 50.0% of profit attributable to equity holders in respect of FY2021 and FY2022.


Financial Performance

Additional Information from Offer Document (click here)
IPO Details

Placement price at S$0.30 per Placement Share
Placement of 26.0 million Placement Shares

18.2 million New Shares
7.8 million Vendor Shares


Estimated IPO Market Capitalisation of S$50.46 million based on post-Placement share capital of 168.2 million Shares.
Net proceeds from placement approximately S$6.39 million
Use of net proceeds:

S$0.5 million – Development of the Group’s Business Intelligence and Growth Analytics Segment
S$0.5 million – Expansion into new geographic markets, new industry verticals and functional specialisations
S$0.5 million – Digitalisation of existing business operations
S$2.6 million – General working capital purposes&nbsp;




Audience Analytics – Enabler and Growth Partner to Businesses – Lists on SGX 

Singapore

Audience Analytics Limited operates as a holding company. The Company, through its subsidiaries, provides exhibitions, conferences, digital and print media, and business analytics services that enables us to support companies at different stages of their growth. Audience Analytics serves customers in Switzerland.

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Audience Analytics (AAL SP)

Audience Analytics – Enabler and Growth Partner to Businesses – Lists on SGX

Audience Analytics made its debut on the SGX Catalist today. Established in 2002, the Group offers a range of solutions that allows companies to...

Singapore Exchange Ltd (SGX)

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