PSE says nearly P42-B capital raised in first quarter

THE Philippine Stock Exchange, Inc. (PSE) said the capital raised from primary and secondary offer shares in the first quarter of the year grew to P41.63 billion, rising by over 116.4% from the P19.24 billion seen in the same period last year.

The first quarter saw one initial public offering (IPO), one follow-on offering, two stock rights offerings, and two private placements.

“The approval of our amended listing rules should help accelerate IPO listings at the exchange, especially in the SME (small, medium, and emerging) board with the relaxed requirements and the adoption of a sponsor model for listing,” Ramon S. Monzon, president and chief executive officer of the PSE, said in a statement on Monday.

Last week, corporate regulators approved the amendments in board listing rules, which now prioritizes net income reports over a company’s earnings before interest, taxes, depreciation, and amortization (EBITDA).

Amended rules for listing at the SME board also lowered the operating history of companies and removed the minimum capital requirement, among others.

“When approved, our proposed rules on preferred shares only listing and proposed revisions to the backdoor listing rules should also encourage more listings at the PSE,” Mr. Monzon added.

The proposal seeks to allow the initial listing of a company’s preferred shares at the exchange without listing common shares, which the PSE expects to help raise funds for companies.

Meanwhile, average daily turnover amounted to P10.99 billion, up by 64.6% year on year from P6.68 billion. Foreigners continued to exit the market as net outflows ballooned by 55.1% to P47.91 billion from P30.89 billion in the first three months of 2020.

Uncertainties surrounding the pace of the country’s vaccination program “has discouraged foreign investors from investing in the Philippine market,” as it affects the country’s economic recovery.

More local investors, meanwhile, were seen dipping their toes in the market.

“Despite the increase in net foreign selling, our market experienced record turnover for the first quarter as local investors increased their share in the trading volume to 74.3% from last year’s 54.6%,” Mr. Monzon said.

The PSE president also noted the increased participation of retail investors.

“Preliminary information shows that retail investors may have accounted for over 45% of turnover for the quarter from 26.9% in 2020,” Mr. Monzon reported.

The 30-member PSEi closed the first quarter declining by 9.8% year to date at 6,443.9, while the broader all shares index fell by 8.2% year to date to 3,924.29.

Mr. Monzon said: “We expect that once a good percentage of the population has been vaccinated, [foreign] investors will soon regain confidence in our economy.”

The PSE said it will be hosting two online forms on IPOs this month and will continue to hold investment literacy webinars. — Keren Concepcion G. Valmonte