Hot IPO streak attracts Nat’l Bookstore for possible listing

National Book Store Inc., the country’s biggest bookstore chain, is considering listing its shares on the Philippine Stock Exchange (PSE) given the strong response to the initial public offerings (IPOs) of SM

Investments Corp. and Manila Water Co. Inc.

NBS president Alfredo Ramos said the company is looking to offer its shares to the public following the success of the recent batch of IPOs. Ramos, however, did not indicate the timetable for the IPO and how much the firm plans to offer. "It’s still too early," he told reporters yesterday.

NBS operates 72 bookstores around the country and seven compact school supply outlets. The first National Book Store started as a stallshop in Escolta in downtown Manila before the Japanese occupation, selling supplies, GI novels, and textbooks.

Apart from Manila Water and SM Investments, other companies expected to go public this year include domestic airline Asian Spirit and First Generation Holdings Corp., a unit of First Philippine Holdings Corp.

The PSE is stepping up efforts to lure more IPOs to further spur the growth of the equities market, which grew by 26 percent in 2004 – the second best performer in Asia after Indonesia. In 2003, Manila’s stock market rose 42 percent year-on-year.

Last year, only two companies were listed at the PSE: Petroenergy Resources Corp. which was listed by way of introduction and medium-sized International Exchange Bank.

The bourse is bent on requiring the listing of power firms, telecommunications firms and other entities with projects registered at the Board of Investments. The move is part of continuing efforts to restore investor interest in the equities market.

To promote more IPOs and boost trading activity, the PSE also plans to ask government to offer tax incentives for companies that will go public.

Once dubbed as a get-rich-quick investment option, an IPO is a means of raising funds for expansion and capital, employed by companies as a cheaper alternative to the more expensive debt instruments such as bonds and bank loans.

An IPO is done by selling a portion of the company’s shares of stock at a price based on its book value or on its projected earnings for the year. These shares are then listed with the PSE so that stockholders and investors may trade the issue.

President Arroyo herself has underscored the need for the private sector to come up with a program to improve the stockmarket as the government has delivered the necessary legislations on documentary stamp tax and securitization.

The President has urged the PSE and the Securities and Exchange Commission to broaden the educational campaign to further encourage investors to take up equity investments besides savings in banks or being lured by pyramiding scams.

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 stockholders to list and provide the public with more investment choices.

Out of the over 200,000 corporations registered with the SEC, only 237 are listed at the PSE.