PSE offer proceeds rose 11% to P57B in 2006

Proceeds from share offerings rose almost 11 percent in 2006, raising hopes of a revival in listing with the Philippine Stock Exchange (PSE). Data from the PSE show that the local bourse raised P57.22 billion in capital via stock offerings in 2006, 10.7 percent higher than the P51.7 billion proceeds in 2005. Of the offer proceeds, 33 percent came from the initial public offerings (IPOs) of four firms this year. PNOC-Energy Development Corp., a government controlled geothermal energy firm raised P9.6 billion from its initial listing, while First Gen Corp., a power and energy firm owned by the Lopez family, generated P9.09 billion on its IPO. Alliance Tuna International Inc., an exporter of canned tuna products, netted P180.9 million in its IPO. Online trading firm Citiseconline.com gained P149.6 million. “It took a long, long while before local companies had the guts to come back to the capital market to raise their cash requirements… However, a turnaround in sentiment backed up by accelerating liquidity flows have allowed offerings to regain their luster," Erwin Balita, analyst at AB Capital said. Of the P57.22 billion-proceeds earned P29.7 billion, came from follow-on offerings of six listed firms. Metropolitan Bank and Trust Corp., raised P6.6 billion, Ayala Corp P5.8 billion. Property firms Megaworld Corp. and Robinsons Land Corp. generated P5.6 billion and P5.4 billion respectively, while Chemrez Technologies Inc. raised P1.5 billion. The rest of the capital offering proceeds came from stock rights at P2.3 billion and private placements at P6.2 billion. PSE president Francis Lim said the stock market proceeds raised in 2006 were the highest since 1994, the year the government licensed the PSE to operate as a stock exchange. Lim said the surge in offer proceeds was due to the overall robust local stock prices. The bourse's main index advanced 42 percent in 2005. “Companies sometimes entertain second thoughts about offering their shares to the public, especially when the market is uncertain. But the continued rise in the PSE index, which we have been enjoying since 2004, has provided these companies with the confidence to offer shares to the public. And they are not regretting the decision," Lim said. “I am saying this, because stock prices of all companies that conducted an initial public offering [IPO] this year have advanced. This means that the IPO firms have benefited from the overall surge in the market," he added. - Patricia de Leon, GMANews.TV