Philippine Infradev gains 2% after suspension lifted

Philippine Infradev [INFRA 0.54, up 1.9%; 3000% avgVol] [link] gained 1.9% yesterday after the PSE lifted the company’s suspension for reporting failures. INFRA had been suspended on May 17 for its failure to submit its FY23 Annual Report and Q1/24 Quarterly Report, but had its suspension lifted after the company submitted both to the exchange. INFRA is developing the Makati City Subway project which was deemed “infeasible” by the court system’s ruling on the border conflict between Taguig and Makati.

MB bottom-line:  I’m excited by the PSE’s newfound willingness to enforce the Consolidated Listing and Disclosure Rules (the Rules) as written. We’ve seen the PSE suddenly leap into action to delist several zombie companies that have been in suspension for years (sometimes decades), and we’ve seen the PSE become uncharacteristically bold in its handling of recent suspensions with threats of involuntary delisting for continued non-compliance. That’s why I’m frustrated by the PSE’s handling of INFRA here. Technically, Article 7 Section 17.8 of the Rules states that the PSE “shall initiate delisting procedures” if the suspended company fails to comply with the reporting requirements before the end of its three-month suspension. Not “may initiate delisting”. Not “will consider delisting as one of many options”, but "Shall”. INFRA was suspended on May 17, which means that the Rules required the PSE to initiate involuntary delisting procedures against INFRA back on August 17. That was nearly three weeks ago. I don’t understand the inconsistent application of this clearly written rule.

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