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MANILA, Philippines – The Philippine Stock Exchange (PSE) is expecting to close 2015 with more initial public offerings, PSE President and CEO Hans Sicat said on Wednesday, November 25.
Speaking on the sidelines of the 2015 PSE Bell Awards, Sicat said that there were 5 or 6 new IPOs in the pipeline that should come to market assuming there’s not too much market volatility.
He said that two of these would probably come before 2016, such as real estate firms D.M. Wenceslao and Italpinas Development Corporation.
Sicat also said that the PSE was still waiting for Securities and Exchnage Commission approval for its plan of upping its stake at Philippine Dealing System Holdings Corporation (PDSHC), the operator of the country’s markets for fixed-income securities and foreign exchange.
The buyout by PSE of PDSHC shareholders would pave the way for the merger of the equities and fixed-income exchanges. Although a major stumbling block by the SEC is resolving anti-monopoly issues.
On the subject of monopoly, Sicat said, “I think that’s a misplaced view because we’re in a global competition for capital and in any business like an exchange, there’s only one or two classes. So as an investor, you have the choice to put your money anywhere in the world.”
He explained: ”You also have the choice to put money in property or all sorts of other things so it can’t be a monopoly because we’re not an island. The old view may have held in the 1940s and 1950s. But now, it isn’t the case since we now have a global movement of capital.”
There’s a lot of uncertainty all over the world, but from the Philippine perspective, the fundamentals are strong so if that is the only benchmark, then the market should be reasonably calm, according to the PSE president.
“One issue about volatility is the reaction to the expected US Federal Reserve interest rate hike. It could cause a major taper tantrum, we don’t know,” Sicat said.
He added that the market is always concerned about the consequences of a China slowdown, and that it tends to overreact in the short run.
He also pointed out that some of the major markets have been roiled by recent events, referring to the Paris attacks and the panic that ensued right after.
“It has nothing to do with market, but in the short run it basically makes everyone jumpy in different ways,” he said.
Sicat said that “it would be hard to say” whether the PSE Index (PSEi) could again reach the record high levels above 8,000 experienced, but pointed out that the exchange is expected to hit the mark of P200 billion ($4.25 billion) in total funds raised on the PSE soon.
“We’re a little below that right now, around P180 billion ($3.83 billion), but with the next IPOs, we should hit it by the end of year,” he said.
It has been a year of highs and lows for the PSE which started the year in record breaking fashion before global instability pulled the index back.
As PSE Chairman Jose Pardo said in his speech at the PSE Bell Awards: ”The stock market this year showed how the market can be unforgiving.”
The index broke past the 8,000 mark for the first time in April this year, an occasion marked by President Benigno Aquino III himself who rang the opening trading bell then.
In August, a global equities rout caused by weak growth data from China hit the local bourse causing a dramatic fall.
As of November 25 afternoon, the PSEi stood at 7,059.14.
Corporate governance highlighted
On Wednesday night, PSE highlighted the governance efforts of a few publicly listed firms and trading participants at the 2015 PSE Bell Awards held in Makati on Wednesday, November 25.
This is the fourth time the PSE held the event, the culmination of an effort beginning in April by an independent panel of judges to find the firms that best followed the exchange’s corporate governance guidelines and complied with relevant rules and regulations.
The winners this year were:
- China Banking Corporation
- Globe Telecom
- Philippine Long Distance Telephone Company (PLDT)
- Aboitiz Equity Ventures Incorporated
- Philex Mining Corporation
- Maybank ATR Kim Eng Securities Incorporated
- Deutsche Regis Partners Incorporated
- Credit Suisse Securities Philippines Incorporated
- Macquarie Capital Securities Philippines Incorporated
- R.S. Lim and Company Incorporated
$1 = P 46.99