Retail and banking magnate Lucio Co has announced plans to launch a P30-billion real estate investment trust (REIT) this year, filling the void left by billionaires Enrique Razon Jr. and the Sy family, who have postponed their IPO due to market volatility.
Ramon Monzon, President of the Philippine Stock Exchange (PSE), revealed that Co, owner of Cosco Capital and Puregold Price Club, intends to take an industrial-themed REIT firm public in the second half of the year.
“They were supposed to file an application this month. They are finalizing the list of underwriters,” Monzon told reporters during a business roadshow organized by the Securities and Exchange Commission on Friday.
Co’s REIT is expected to be valued at between P15 billion to P30 billion.
Meanwhile, property giant SM Prime Holdings is planning to launch the country’s largest IPO in the second half of 2023, with the listing of its mall assets aiming to raise approximately P55 billion.
However, Monzon stated that “they [SM REIT] will postpone to next year [but] they will file in the fourth quarter [of 2023].”
Prime Infrastructure Capital Inc., owned by Razon, which had planned to raise P33 billion, and Citicore Renewable Energy Corp., owned by tycoon Edgar Saavedra, are among the larger IPOs that have been deferred.
These types of IPOs require significant participation from foreign institutional investors, who tend to avoid riskier investments during challenging market conditions.
Despite these setbacks, Monzon encouraged companies with compelling growth narratives and a need for capital to consider the equity market.
“Some companies defer their listing plans because market conditions are not good,” he said. “But the IPO price is not the sole measure of success for an IPO.”
Monzon also highlighted that, as of July, only the Philippines and Vietnam among ASEAN countries remained positive compared to the previous year.
He disregarded concerns about declining domestic trading volume and delistings, stating that this was not uncommon in other markets.
“It may look bad, but you have to look at it in the context of the region,” he noted, adding that “Vietnam is down 31% in trading volume.”
Despite the challenges, Monzon expressed confidence in achieving their target to grow capital market fundraising by 44% to P160 billion, which includes IPOs and follow-on share sales such as the upcoming P25-billion offer of ACEN Corp.
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