Capital-raising at PSE to likely hit P 237.52B in ’21

Capital-raising at the Philippine Stock Exchange (PSE) this year can reach about P237.52 billion—a new high for the market—given the robust pipeline of maiden or follow-on offerings for the rest of the year.

In the first 10 months, fresh capital raised through the PSE reached P197.23 billion, eclipsing the P103.76 billion capital raised for the whole of last year, PSE president Ramon Monzon said in a presentation to the Philippine Chamber of Commerce & Industry-Quezon City last week.

Based on the pipeline for the last two months, Monzon said total capital-raising, including the issuance of secondary shares, could hit a new record of P237.52 billion, surpassing the level seen in 2012, during the term of the late President Benigno Aquino III, when the level hit P228.33 billion.

“Our capital-raising pipeline remains robust as more companies are set to list their shares in the remaining two months of 2021,” he said.

“We expect the fund-raising pipeline to grow further as the local economy recovers and business conditions improve,” Monzon said. He also cited the regulatory reforms and various marketing initiatives undertaken by the PSE to encourage companies, both big and small, to list their shares on the exchange. “We eagerly look forward to more SME (small, medium and emerging board) listings in the coming years,” he said.

This year, six new names have debuted on the stock exchange, namely: AllDay Marts, MREIT Inc., RL Commercial REIT Inc., Filinvest REIT Corp., Monde Nissin Corp. and DDMP REIT Inc. There have also been a number of backdoor-listing/follow-on and preferred shares offerings.

In consideration of the extraordinary impact of the COVID-19 pandemic, the PSE’s new listing rules offer sweeteners to those braving the market this year and next year.

For applications filed this 2021 and 2022 for listing on the main and the SME board, the PSE may consider the profitability of the applicant for any two fiscal years in the three most recent fiscal years, excluding the year of the impact.

For an IPO (initial public offering) application filed this 2021 by a company demonstrating the negative impact in its financial condition and results of operations for 2020 due to COVID-19, for instance, the two most recent fiscal years would be 2018 and 2019. If the application is filed in 2022 and the year of the impact is 2020, the two most recent fiscal years would be 2019 and 2021. However, the IPO applicant must fully disclose in the prospectus the adverse impact of the pandemic on its operations, expected duration of the business effects of the pandemic, recovery measures and business prospects of the applicant in the next five years, among others. INQ