The Main Market in Bursa Malaysia is actually a combination of the former Main and Second Board companies. Today, companies which was previously listed under the Main and Second Board of the then Bursa Saham Malaysia are all coined in the Main Market. This was made through a unification process which took place in August 2009.
Streamlining public listed companies
The reason this exercise was carried out was to streamline all the processes, rules and regulations for companies to be listed in one market where it would help to lower costs of regulation as well as to provide shorter time-to-market duration. Basically, if you are trading shares through the main companies in Malaysia, you will be trading through the Main Market. The other market in Bursa Malaysia is known as the ACE market which is more industry specific.
What is the Main Market exactly?
The Main Market in Bursa Malaysia is where companies list their shares for trading and you will find the likes of MAS, AirAsia, Petronas and others. Under the Listing Requirements (LR), the company must ensure that at least 25% of its total shares issued are spread for public shareholders. Generally, the Main Market is where most share investors try to earn their profit by buying and selling of the respective companies’ shares.
The Main Market is part of the 2 markets under the Securities Market of Bursa Malaysia where it currently holds 823 companies. Under the Main Market, products such as shares, REITs, ETFs, Warrants and such are traded on weekdays from 9am to 5pm apart from public holidays. Pre-opening hours start from 8.30am to 9am and from 12.30pm to 2.30pm is the midday break. 4.45pm to 4.50pm is the pre-closing session while last trading in the Main Market starts from 4.50pm and the market closes at 5.00pm.
At the end of each day, the performance of the 30 largest companies grouped by their full market capitalization on the Main Market will determine the FTSE Bursa Malaysia KLCI Index or FBM KLCI which will give you an overall sentiment on how the market fared for that particular day. this was previously known as the KLCI Index since the unification of the 2 boards.
Listing the company on Bursa Malaysia
A lot of homework must be carried out if you want to have your company listed in the Main Market of Bursa Malaysia. While you might want to consider employing a professional consultant to get your company there, perhaps one of the most influencing factors would be in the dollars and sens. Here are some that you might be interested to know.
Basics of getting listed
There are several important issues that you must know and consider before getting your company listed. Among them, you should have either one of the following:
- The company must have a market capitalization of more than RM500 million after listing. Besides that, there must be a one-full year of revenue generated
- A project that the company has secured (and confirmed). Here, the company would be given the right to build or operate some form of infrastructure either locally or abroad which costs more than RM500 million
- A profit after tax with the aggregate of over RM20 million continuously for 3 to 5 years. The latest profit after tax meanwhile must be over RM6 million
As for the criteria, the company must:
- Have at least 1,000 shareholders
- At least 50% of the shares are allocated for Bumiputera shareholders
- Not have any accumulated losses in shareholders equity while cash flow is positive from overheads and operations
- Have sufficient working capital of at least 1 year
- Have the same management in the company for 3 years or more
- Operating a core business which is not a holding investment firm for another public listed company
What about payments
To get the company listed in the Main Market, be prepared to incur costs. This includes:
- Application fee: RM80,000. This is not inclusive of the 0.01% of the market value of listed securities
- An initial listing fee: 0.01% of the issued capital market value or a minimum of RM20,000 and capped at RM200,000.
- Prospectus Registration: RM15,000
- 1 to 3% of the value of shares to be paid as Underwriting, Placement and Brokerage fees
- Other fees: This includes auditors, professional services, consultancy and others which differ among parties