SET to tighten supervision of listed Thai firms starting March 25

The Stock Exchange of Thailand (SET) announced plans to strengthen the supervision of its listed companies from March 25 onwards, as part of an initiative to reinforce their financial standing and provide detailed disclosure for investors. SET’s president, Pakorn Peetathawatchai, stated that the move aims to provide investors with clearer and more varied warning signs to alert them of potential financial and operational challenges faced by listed companies.

Pakorn also mentioned the SET’s intention to enhance the standards for backdoor listings and the resumption of stock trading to match the rules for new listings. These changes will be implemented gradually starting on March 25.

The SET president divulged that the organisation is working with the Securities and Exchange Commission to review and amend various criteria, based on the current circumstances. Four major areas are expected to undergo revision.

The first anticipated change pertains to the qualifications of companies listed on both SET and the Market for Alternative Investment. As of next year, the SET plans to increase the profits and shareholders’ equity requirements for companies listed on both exchanges, reported Bangkok Post.

The second change will see the SET introducing more warning signs for investors about situations that could potentially impact a listed company’s financial position, operational performance, or financial liquidity.

The third expected change relates to the addition of reasons for delisting a company. For example, if a company has been inactive for many years or has failed to rectify the free float requirements within the given time frame, the SET will question its suitability to remain listed.

The final anticipated change involves strengthening the rules for backdoor listings and the resumption of stock trading, to ensure that they are on par with new listings.

Paveena Sriphothong, senior vice president and head of market supervision for the SET, revealed that the C mark currently placed on 19 companies would be replaced by a CB (caution business) mark. She expects the number of marked companies to rise to 50 post March 27.

Paveena explained that most of the companies marked with a C are financially troubled. The addition of a warning sign serves to alert investors about the potential risk of the company being delisted, urging them to exercise caution when investing.