BOI-registered firms urged to list at PSE

As part of efforts to promote more initial public offerings (IPOs) and restore investor interest in the equities market, the Securities and Exchange Commission has urged the Board of Investments to draft the minimum capital requirements for BOI-registered companies qualified to list at the exchange.

SEC Chairman Lilia R. Bautista said the BOI should draft the criteria for listing to encourage BOI-registered entities to offer their shares to the public. Bautista said the BOI could work within the guidelines of the Philippine Stock Exchange, which set a minimum capital requirement for companies listing on the main board, second board and the small and medium-enterprise board.

"Since we cannot force all companies to list, there should at least be a minimum capital requirement for companies eligible for listing at the stock exchange," Bautista said.

Bautista has encouraged entities registered with the BOI to go public to enable them to expand their capital base and finance capital expenditures. She said subsidiaries of companies that enjoy incentives from the BOI should also offer their shares to the public.

The SEC has also urged the country’s top 5,000 corporations and SEC-registered entities with P50 million in assets and at least 100 million stockholders to list at the PSE in line with efforts to provide the public with more investment choices.

Out of the 200,000 corporations registered with the SEC, only 237 are listed. And of the 237, only 100 are actively traded.

After a relatively lean year for IPOs, the PSE is hoping to attract more companies – from SMEs to giant multinationals – to list their shares and provide the impetus for a long-awaited stock market rally this year.

From big-ticket items that include the likes of oil firms Shell and Caltex, energy companies PNOC and Mirant, and pharmaceutical leaders United Laboratories and Mercury Drug, the PSE is also in active discussions with small and medium enterprises, which seemed more eager to offer their stocks to the public.

To qualify for listing at the SME board, companies should have an authorized capital of between P20 million to P100 million; a paid-up capital of at least 25 percent; and at least a two-year record of positive net operating income, among others.

Only five companies undertook IPOs last year: Salcon Power, Highlands Prime, Banco de Oro and Jolliville Holdings, and Makati Finance Corp.

Despite the mandatory listing requirements for energy companies as well as those that have availed of fiscal incentives from the BOI, they were able to delay their listing, citing poor market conditions.

Earlier, the PSE also indicated plans to tap companies located in the country’s economic zones, a move that would "democratize" the stock market and make it a more effective barometer of the domestic economy.

Out of about 1,000 ecozone locators located in the country’s 85 accredited ecozones, less than a handful are listed – Ionics Corp., SPI Technologies and Active Alliance.

Nearly 80 percent of the ecozone companies are foreign-owned or controlled, most of them from Japan, the US, United Kingdom, Taiwan, Singapore, Malaysia and other Asian countries.