P175B in capital raised via stock market in 9 months

Capital raising at the Philippine Stock Exchange reached a record high P174.97 billion in the first nine months, as the upbeat investor sentiment encouraged a number of companies to either go public or widen public ownership.

Net foreign buying in the stock market from January to September also surged to P95.21 billion from P15.61 billion in the same period last year, as more offshore investors bought into the Philippine growth story.

The surge in foreign inflows helped drive up the main-share Philippine Stock Exchange index by 22.3 percent during the period.

“The market’s sustained increase has presented attractive valuations for listed firms to raise capital at the exchange this year,” PSE president Hans Sicat said in a statement.

The P174.97 billion worth of capital raised through the stock market in the first nine months exceeded the full-year 2011 figure of P107.50 billion.

Three initial public offerings were  held at the stock market during the period—those of GT Capital Holdings Inc., East West Banking Corp. and Calata Corp. Capital-raising was likewise buoyed by the follow-on offerings of San Miguel Corp. and First Gen Corp.,  and the stock rights offerings of BDO Unibank Inc., Belle Corp., Alcorn Gold Resources Corp. and Philodrill Corp.

The PSE said the overall trading activity was robust during the first nine months of the year on account of a third round of quantitative easing in the United States, coupled with the country’s sound economic environment. On September 13, the Federal Reserve announced it would purchase additional $40 billion worth of agency mortgage-backed securities a month to further stimulate the US economy.

On October 4, the PSE index staged a new high at 5,443.74. Total value turnover for the nine-month period reached P1.31 trillion, 25 percent higher than the level registered in the same period last year. Total value turnover at the local bourse amounted to P1.42 trillion in 2011.

The combined market capitalization of listed issues in the PSE at the end of the nine-month period rose by 28.5 percent to P10.54 trillion from a year ago.

In terms of sectoral indices, the financials index emerged the best performer in the nine-month period, climbing by 41.5 percent. This was followed by the property index with a 40-percent rise. The holding firms sector gained 28.2 percent, followed by the industrial sector, which increased by 15 percent. The services sector rose by 11.4 percent.