Shell trades higher post-IPO

The share price of Pilipinas Shell Petroleum Corp. closed higher on Friday after it traded flat on its market debut.

Shell's shares opened at P67.40 and closed at P69.50 apiece, up P2.50 or 3.73 percent.

On Thursday, it closed at P67.20, relatively the same level as its initial public offering price of P67.

Harry Liu, president of Summit Securities Inc., said the oil company entered the Philippine Stock Exchange when the market is at an oversold level at 7,100-7,200 index point.

"It listed when the market was soft. So when the market rallied today, its tendency is to be positive, of course, wala naman siyang fundamental negative e," Liu noted.

He took note that Shell is a "good issue" given that its an old company, the second largest petroleum firm in the Philippines, and and its has a good dividend policy.

Shell has set a policy of paying out yearly at least 75 percent of its previous year's profit as dividends.

"One good reason for the surge today is that buyers who wanted to buy Shell pre-IPO and on its first day, were waiting for more favorable market condition before getting in," Gerard Barboza, equity trader at AP Securities Inc., said in a text message.

"The novelty of the known gas company attracted fund flows as investors start to get in the market," Barboza added.

For his part, Regina Capital Development Corp. Managing Director Luis Limlingan said that Shell's shares were carried by today's market sentiment, which is on bargain hunting.

Share prices on the PSE snapped a nine-day losing streak as investors took advantage of cheaper shares to hunt for bargains. — VVP, GMA News