MerryMart sizzles on PSE trading debut
MerryMart chair Edgar Sia II with PNB Capital president Gerry Valenciano
Shares of Merry Mart Consumer Corp., led by young tycoon Edgar Sia II, sizzled on stock market trading debut on Monday as investors welcomed a new purely non-discretionary or essential consumer play during this pandemic.
It was the first company to conduct an initial public offering (IPO) this challenging year.
Shares of MerryMart, which listed on the small, medium and emerging board (SME) of the Philippine Stock Exchange (PSE), gained 50 centavos – hitting the maximum daily price ceiling of 50 percent – to close at P1.50. It was among the day’s most actively traded companies.
The retailer bucked the downturn in the local stock market. The main-share Philippine Stock Exchange index (PSEi) shed 312.42 points or 4.82 percent to close at 6,163.82 on Monday.
MerryMart raised P1.6 billion from the IPO which oversubscribed by twice the amount of shares pitched to the stock market. All the IPO shares were taken up by local investors. PNB Capital acted as sole underwriter.
“We hope that this move of MerryMart to tap the stock market for funding will encourage more entrepreneurs to do the same. PSE is currently reviewing and revising its listing rules to make the equities market more accessible to small and medium enterprise owners,” PSE president and chief executive officer Ramon Monzon said in his welcome remarks.
“This IPO of MerryMart, done during this global pandemic is far better than any kind of survey, because this is a real thermometer of the underlying state of our economy. It shows that our economy is alive and ready to begin bouncing back,” Sia said during the listing ceremony.
The non-discretionary consumer segment includes groceries and pharmacies selling essential goods that people consume in good times or bad.
“And this IPO will not be possible if our government just did nothing. Our economy is tiding through the rough waters well, and that is possible because of the well thought out and decisive decisions that were put in. Definitely a lot of thought, work and intervention, unseen my most of us, was done to get our economy to survive,” said Sia.
Finance Secretary Carlos Dominguez III, who graced the listing ceremony, said in his keynote message: “This initial public offering signals trust in our good economic prospects. It shares in the optimism that, notwithstanding the global downturn engulfing us today, the Philippine economy has the fundamentals to rise quickly from the devastation wrought by the pandemic. It is also a sterling example of how government and the private sector can work together to inspire public confidence in our ability to quickly recover from this crisis.”
As to why MerryMart decided to brave the stock market at this time that the coronavirus is causing a global recession, Sia said many of the most successful businesses around the world either started during a crisis, or deepened market grip during the crisis period.
“Because actually, during a highly challenging period like where we are now, the large established players’ huge size and heaviness, suddenly becomes a disadvantage, and natural to a major crisis comes the repositioning of elements, such as, a major change of customer behavior, which suddenly, the pile of money alone, can not solve,” Sia said.
“In fact, it is during periods like this, during unprecedented times like this, when the mountains of revenue or income that a large company has generated in the past 10, 20, or 30 years will have not much use or value. What is most important in times like these is to have a relevant and well innovated business model, and the company and the team have to be quick and nimble enough, to adjust and calibrate simultaneously, as the dust of the crisis settles and emerge successfully, stronger than ever, and move forward to the future in an even better market position,” he added.
Shown in photo (L-R, by row): Philippine Chamber of Commerce president Ambassador Benedicto Yujuico and PSE director Eusebio Tanco; MM chair and CEO Edgar Sia II; Department of Finance Secretary Carlos Dominguez III; PSE president and CEO Ramon Monzon and PSE director Edgardo G. Lacson; MM president and COO Ferdinand Sia; PNB president Wick Veloso and PSE director Emmanuel Bautista.
