Capital raising by listed firms more than double in H1 – PSE

MANILA, Philippines - Philippine companies turned more active in raising capital through the local bourse in the first semester despite a consolidation phase in the stock market early this year.

The Philippine Stock Exchange (PSE) is set to post another banner year in terms of capital raising activity given high liquidity and the recovery in investor participation, the local bourse said in a statement yesterday.

Capital raised by companies through initial and follow-on public offerings, stock rights offerings and private placements hit P76.12 billion in the first half, more than double the P30.8 billion a year ago.

 “We are again poised for another banner year based on various growth metrics. We started the year slow as we saw some fund rotation out of the country at the beginning of the year but we have since picked up the pace as shown in the rise in net foreign inflows all the way to the end of June,” said PSE president and CEO Hans B. Sicat.

DoubleDragon Properties Corp. and Century Pacific Food Inc. had conducted initial public offerings (IPOs) while 8990 Holdings Inc. raised funds through a follow-on offering.

Bank of the Philippine Islands, Philippine National Bank, China Banking Corp. and Manila Mining Corp. secured additional capital through stock rights offerings, while 10 other companies had private placements, PSE said.

 “On a run rate, we may be behind our target for capital raising but we remain optimistic that we can meet the P200-billion mark for the year,” Sicat said. The PSE P175.07 billion were raised from the equity market through a total of 28 IPOs, private placement and stock rights offerings in 2013.

The benchmark PSE index jumped 16.2 percent to 6,844.31 as of end-June, making it the fastest growth in the region next only to the main index in India.

However, investors were hesitant to accumulate stocks in the first half as total value turnover declined 29.3 percent to P993.01 billion from P1.4 trillion a year ago.

Average daily value turnover also slipped 29.3 percent year-on-year to P8.14 billion, PSE data showed.

“We have also seen an increase month-on-month in our liquidity levels. If this pace continues, we think we can get to at least our average trading levels of last year,” Sicat said.

Net foreign buying reached P45.67 billion in the first six months, 14.4 percent lower from the same period last year but almost triple the figure registered for the entire 2013.

PSE said total market capitalization as of end-June stood at P13.35 trillion, higher by 11.9 percent from P11.93 trillion as of end-2013 and up by 14 percent from P11.71 trillion registered at the end of June 2013.

To date, there are 260 publicly listed companies and 134 active trading participants in the PSE.