With shrunken IPO, Top Line drops depot expansion

As a result of downsizing its initial public offering (IPO) size, Top Line Business Development Corp. has dropped plans to expand its fuel depot capacity and will shift its focus to importing fuel and boosting retail expansion in Central Visayas.

“Luckily, in our current depot that we’re also operating, they have enough capacity for us to import,” Top Line chair Erik Lim told the Inquirer in an interview on Friday.

The Cebu-based conglomerate had allocated the lion’s share of its original IPO size of P3.12 billion to build new fuel depots in Bohol and Mactan.

READ: Top Line delays, shrinks IPO to P900M

These facilities were expected to boost Top Line’s fuel capacity by 30 million liters from 5 million liters currently.

But Top Line later cut its IPO size by 75.5 percent to P764.2 million, citing discussions with potential institutional investors.

“If you look at the current use of proceeds, it’s basically making sure that it’s more efficient in terms of the deployment of capital,” Lim said.

“It’s more of focusing on the importation, and then expansion of the retail arm,” the CEO added, referring to the Light Fuels brand that caters mostly to two-wheel vehicles.

Q2 debut

Top Line, which is also engaged in the businesses of real estate and ports, sources its entire fuel supply from the country’s sole oil refinery—Petron Corp.’s facility in Bataan.

Once Top Line launches its IPO in the second quarter of this year, it plans to start pursuing a balance between imported and locally sourced fuel in order to “interconnect the whole supply chain,” according to Lim.

At the same time, Top Line has upgraded its expansion plans for Light Fuels from up to eight stations to 20 stations in the next two years.

Light Fuels, the main market of which is Central Visayas, currently has four operating stations that sell diesel products. This year, Top Line will add gasoline to their offerings.

“There’s a lot of room for growth … We’re only about 6 to 8 percent in terms of market share [in Central Visayas] so we’re still quite bullish,” Lim said.

“If we incorporate other products, it can push our volume even further,” he added.

High volume sales caused a 157-percent surge in Top Line’s net income in the first nine months of 2024 to a historic high of P90.5 million.

This already exceeded the company’s full-year 2023 profit of P78.2 million.

Revenues likewise inched up by 9 percent to P2.4 billion.

Top Line sold around 50.8 million liters of liquid fuels during the period, up by 19 percent from 2023.