Mid-caps
are increasingly on the radar of institutional investors in Singapore and with
listing activity set to rise again this year, opportunities for diversification
will also increase.
Institutional
interest in Singapore’s small- and mid-cap segment has strengthened
meaningfully over the past year.
The
Monetary Authority of Singapore’s equity market development programme has been
a major catalyst, directing capital to strategies with a significant allocation
to locally listed equities – particularly those outside the large-cap universe.
The
equity market development programme was launched in February 2025 with a S$5
billion investment to bolster the local fund management ecosystem, deploying
$3.95 billion across two batches of appointed asset managers, with a third
allocation expected in the second quarter of this year.
In
addition, tax exemptions were introduced for fund managers investing
substantially in Singapore-listed equities, while adjustments to the Global
Investor Programme targeting Singapore-based single family offices were made to
encourage capital inflows.
The
grant for the equity market Singapore scheme, enhanced by S$50 million from the
Financial Sector Development Fund, now includes research coverage on pre-IPO
companies and mid- to small-cap enterprises.
According
to Yain Wang, AEW managing director and chief investment officer for Asia
Pacific, these initiatives have helped to broaden market liquidity and improve
price discovery for smaller companies.
“With
S$3.95 billion already allocated to nine asset managers, momentum is building
and many investors now view small and mid-cap companies as a key theme for 2026
as liquidity improves and structural reforms take hold,” she says.
Value
Unlock and Market Support
Complementary
initiatives such as the Value Unlock programme further support this segment of
the market by strengthening corporate engagement and transparency.
Value
Unlock is a strategic initiative by the Monetary Authority of Singapore and the
Singapore Exchange that helps listed companies realise their full valuation
potential by encouraging them to think beyond ‘business as usual’, identify
opportunities for improvement, and implement and communicate actionable
strategies that create sustainable shareholder value.
Singapore Exchange wants to attract more companies from China and Southeast Asia to list in the city-state to increase momentum in IPOs https://t.co/cY7hvuKr5K
— Bloomberg (@business) February 5, 2026
IPO
Activity Rebounds Strongly
According
to PwC’s latest equity capital markets watch report, after a decline over the
past three years, Singapore’s IPO activities experienced a strong rebound in
2025 with 12 IPO deals.
Deloitte’s
Southeast Asia IPO capital market report 2025 notes that the real estate sector
saw two key listings in Singapore, with assets for data centre and
accommodation purposes. While the consumer sector accounted for the highest
number of public offerings last year, it was real estate that fuelled the
massive increase in funds raised – S$2 billion compared to just S$34 million in
2024.
According
to the report, these listings reflect a broader regional shift toward niche
asset classes. Investors are drawn to these sectors for their resilience and
growth potential.
IPO
activity in Singapore is expected to progress in its recovery this year,
supported by regulatory and market reforms and specifically measures
implemented by the equities market review group.
The
more accommodative interest rate environment has supported the return of REIT
listings on the Singapore Exchange, and healthcare and technology companies are
also expected to pursue listings on the SGX. Investors will remain selective,
focusing on companies with strong fundamentals, well-prepared offerings and
decent valuations.
Dual
Listing and Structural Reforms
Wang
agrees that the universe of listed companies in Singapore is expected to
increase further and that structural reforms will also influence listing
activity.
“The
MAS-SGX proposal for a dual-listing bridge with Nasdaq, aimed at attracting
high-growth Asian companies, could draw more issuers to Singapore from mid-2026
onward,” she says. “Combined with the Value Unlock programme, these efforts
should support a modest but steady expansion of SGX’s issuer base.
The real
estate sector, in particular, is at an interesting inflection point.
Alternative-living platforms are already active with additional vehicles and
potential listings in the pipeline.”
ETF
Flows and Pipeline Growth
Shawn
Ang, portfolio manager of the Fullerton Singapore Value-Up Fund, also refers to
increased engagement with Singapore’s emerging mid-cap segment from
institutional investors, noting that flows into Singapore securities picked up
in 2025 with overall ETF fund flows reaching their highest level since 2021.
Ang
(who co-manages the fund with Michelle Sim) says that since its inception the
firm has received a number of reverse enquiries about the fund and its
strategies, both locally and across the region.
“In
terms of listings, Singapore’s IPO pipeline has been picking up,” he says. “SGX
recorded 15 IPOs in 2025 – up significantly from 2024 – and as of the first
week of January 2026 more than 30 companies have begun preparing for listings
across the Mainboard and Catalist [which has no quantitative entry criteria].”
🇭🇰🇸🇬Hong Kong & Singapore to be biggest winners as global capital flows shift to #Asia:HK & SG are best choices for global investors seeking to diversify their portfolios amid geopolitical risks.DBS CEO Tan Su Shan via @SCMPNews. #WealthManagement https://t.co/j34B1J9Kz1
— Urs Bolt 🇨🇭🇵🇭 (@UrsBolt) February 9, 2026
Ang
shares the view that initiatives such as the SGX-Nasdaq dual listing bridge,
which will allow companies to list on both bourses concurrently with a single
set of offering documents, can help to sustain a healthy IPO pipeline by
attracting high-quality growth companies.
“SGX
has also been proactive in its outreach for IPOs from Chinese companies,
especially those pursuing a China + 1 strategy and looking at expansion to
Singapore,” he says. “This allows us to continue to grow our pipeline of
listings and is a trend that benefits the fund in terms of broadening the
investable universe and opening up more opportunities for investment in quality
stocks.”
Strong
Fundamentals Attract Institutions
According
to Robert St Clair, head of investment strategy at Fullerton Fund Management,
institutional investors may turn to domestic assets due to Singapore’s strong
economic fundamentals.
“The
economy expanded by 4.8% in 2025, more than the Government’s forecast of 4%,
marking its best performance since 2021’s bounce back from the pandemic-induced
recession,” he observes. “Supported by strong productivity, external demand and
trade momentum, Singapore is a valuable anchor in this disruptive realpolitik
environment.”
Singapore’s
AAA sovereign rating, stable currency, strong rule of law and fiscal soundness
continue to make local assets highly attractive to institutional investors
seeking safe, predictable returns – especially against a backdrop of volatile
global geopolitics and rising scrutiny on fiscal sustainability across
developed markets, says Wang.
“Investor
appetite has remained robust across sectors, supported by sound market
fundamentals and lower financing costs,” Wang concludes. “These characteristics
reinforce Singapore’s status as a regional safe haven and strengthen the case
for sustained institutional overweighting to domestic assets.”
This article was written by Tareq Sikder at www.financemagnates.com.
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