Singapore rolls out $6.5b equity boost to strengthen market liquidity

The policy move is expected to support trading activity and deepen market participation.

Singapore has expanded its Equity Market Development Programme to $6.5b from $5b, a move expected to increase liquidity and support capital markets activity, according to a 16 February report by RHB Investment Bank.

The programme channels institutional capital into domestic equities and is intended to strengthen trading activity and market depth.

RHB said the expansion could support higher securities turnover, improve fundraising conditions, and increase investor participation in Singapore-listed firms.

Average daily securities turnover on the Singapore Exchange is projected to increase to $1.84b by FY 2028 from $1.3b in fiscal year (FY) 2025, according to the report.

Derivatives volumes are expected to grow at a compound annual growth rate of about 10.4% over the same period, supported by institutional demand and hedging activity.

Recurring net profit at SGX is forecast to rise to $853m by FY2028 from $611m in FY2025.

Dividend per share is projected to increase to $0.60 from $0.38, reflecting higher earnings and continued capital returns, RHB said.

Despite the earnings outlook, RHB maintained a “neutral” rating on SGX with a target price of $19.00, citing limited upside from current levels.

The exchange is trading at about 26 times forward earnings, above its historical average, according to the report.

RHB said further share price gains would likely depend on sustained increases in trading volumes or additional catalysts supporting market activity.