STAR Travel Corp Taipei was listed on Taiwan’s Gre Tai Securities Market stock exchange on February 24, becoming the second local travel consultancy to go public after Phoenix Tours International last November.
More domestic travel and hospitality firms are expected to follow suit, with Chateau International Development, a resort hotel operator in Kenting, scheduled to go public on March 14, and Lion Group Taipei due to launch an IPO in third quarter 2013.
According to Mars Hsu, analyst, Grand Cathay Securities, two travel consultancies, nine hotels and one amusement park are already listed on the stock exchange in Taiwan.
“I think this is an effort by (local travel companies) to push their brand names in China and elsewhere, though of course, they will also use the capitalisation to seek additional business opportunities,” he said.
Echoing Hsu’s sentiment, Star Travel CEO Vincent Lin explained that the opportunity to boost brand awareness overseas was a key factor behind his company’s listing, which he believes will help its three branch offices in China – in Xiamen, Shanghai and Suzhou – to grow traffic to Taiwan, particularly in the FIT segment.
“We wanted to elevate the value of our brand and increase brand perception among consumers,” said Lin. “Many companies use stock market listings to raise capital. We didn’t need to do that as we are part of Tsann Keun Enterprise (a Taiwanese home appliance and consumer electronics giant).”
Reporting by Glenn Smith