NexGen Energy Corp. led by businessman Dexter Tiu closed more than 1 percent above its IPO price during its stock market debut on Tuesday despite not raising its target amount, reflecting a still-receptive environment for renewable energy firms.
NexGen, which listed on the Philippine Stock Exchange’s (PSE) small, medium and emerging (SME) board under the ticker “XG,” closed at P1.71 per share or 1.8 percent above its IPO price of P1.68.
The third company to brave a volatile stock market this year raised P529 million from the sale of 315 million shares.
READ: NexGen sets public listing price at P1.68 per share
However, this was 8.8 percent below NexGen’s target of raising P580 million, as it did not fully exercise its over-allotment option of 45 million secondary shares.
Juan Paolo Colet, managing director at investment bank China Bank Capital Corp., said that while many short-term traders—or active traders who buy and sell stocks within a short period—exited on NexGen’s first day, the bulk of the company’s investors were “strong hands who are confident about the company’s prospects.”“[NexGen’s] successful IPO will encourage other renewable energy or similarly sized companies to explore listing on the PSE,” Colet added.
NexGen is also the second renewable energy-focused firm to list on the local bourse this year, following the stock market debut of tycoon Edgar Saavedra-led Citicore Renewable Energy Corp. on June 7.
For his part, PSE president Ramon Monzon said NexGen’s IPO “serves as a timely reminder to other small companies that need to raise capital that the SME board is a very practical and feasible listing route.”
Funds raised from the renewable energy firm’s IPO will be used to develop a solar project in Zambales and wind projects in Cavite. —Meg J. Adonis INQ