MerryMart shares sizzle, close 50% up on 1st day of trading

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.

Shares of MerryMart Consumer Corp., led by young tycoon Edgar Sia II, sizzled on the retailer’s stock market trading debut on Monday as yield-seeking, coronavirus-weary domestic investors welcomed a new “essential” consumer play during this pandemic.

MerryMart—which listed on the small, medium and emerging board (SME) of the Philippine Stock Exchange under the ticker “MM”—gained 50 centavos, hitting the maximum daily price ceiling of 50 percent. At its closing price of P1.50, the company was valued by the stock market at P7.59 billion.

The company defied the downturn of the Philippine Stock Exchange index, which tumbled by 312.42 points, or 4.82 percent, to close on Monday at 6,163.82.

“It was a fantastic kickoff by MerryMart. It seems like the pricing and prospects of the company generated much interest from market players. Nowadays, this market is only for the brave. Sia not only showed courage but his ingenuity despite the odds,” said Astro del Castillo, managing director at fund management firm First Grade Finance Inc.

“The strong stock market debut of Merry Mart is a testament to the company’s ability to provide its clients essential products during the pandemic in a three-in-one format comprising of grocery, pharmacy and health/beauty [stores],” said Gerry Valenciano, president of PNB Capital and Investment Corp., which was the sole underwriter of this equity deal.

MerryMart raised P1.6 billion from an initial public offering that was oversubscribed by twice the amount of shares pitched to the market.

“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.

“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, hailing efforts led by the economic team which includes
Finance Secretary Carlos Dominguez who graced the listing ceremony.

Sia, who helped tend his parents’ grocery store in Capiz as a child, brought his second company to public hands six years after listing DoubleDragon Properties in April 2014.

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.

Sia said MerryMart’s IPO investors had come in at a time that the company was entering its “hyper” growth phase.

“Hyper growth years generally lasts 10 to 20 years, and we do not mind at all that we have you as shareholders during hyper growth those years and the sincere intention is for you to hopefully create hyper value together with us,” Sia said. INQ