By JAMES A. LOYOLA and CHINO S. LEYCO
Investors were happy with their subscription to the P1.59 billion initial public offering (IPO) of MerryMart Consumer Corporation whose shares shot up 50 percent to close at the ceiling price upon listing at the Philippine Stock Exchange yesterday.
A total of 250 million shares worth P370 million MM shares were traded yesterday with the price immediately rising above the P1.00 offering price upon listing and hit the ceiling of P1.50 per share in a just a short while.
MerryMart offered of 1.59 billion of its common shares at P1.00 per share. Proceeds from the IPO will be used to fund its expansion program
Finance Secretary Carlos G. Dominguez III, who was guest at the listing ceremonies at the PSE trading floor, said the stock market debut of a grocery retailer firm amid coronavirus pandemic illustrated the strong trust and confidence in the Philippines’ recovery following a global health crisis.
Dominguez said the initial public offering (IPO) and stock market listing of MerryMart Consumer Corp. is a good sign for the country’s economic recovery as it “represents an opportunity for investors to participate in the strong growth we anticipate in the coming period.”
He added that the IPO of MerryMart, owned by DoubleDragon’s Edgar “Injap” Sia II, also “presents us a glimpse of the coming sunrise” for the country that is now starting to bounce back from the economic fallout from the coronavirus disease (COVID-19) pandemic.
On Monday, Dominguez, Philippine Stock Exchange (PSE) President and CEO Ramon Monzon and Sia led the opening bell ceremony of the local bourse to mark MerryMart’s listing on the small, medium and emerging (SME) board of the stock market.
“This initial public offering signals trust in our good economic prospects. It shares in the optimism that, notwithstanding the global downturn engulfing us today, the Philippine economy has the fundamentals to rise quickly from the devastation wrought by the pandemic,” Dominguez said.
“It is also a sterling example of how the government and the private sector can work together to inspire public confidence in our ability to quickly recover from the crisis,” he added.
The finance chief said he expects MerryMart to make the robust retail sector “even merrier,” generate more jobs, stimulate the economy and promote competition in the industry as the country recovers from the COVID-19 crisis.
“In addition, MerryMart will contribute to further enhance our logistics system by bringing goods from the producers to the consumers at the least cost,” Dominguez said.
MerryMart’s IPO, which ran from May 27 to June 5, was the first in the local stock market this year.
The IPO was oversubscribed and priced at the ceiling of the offer price of P1 per share even as the country and the rest of the world continues to grapple with the COVID-19 contagion.
PNB Capital & Investment Corp. was the sole underwriter of the MerryMart offering.
Dominguez noted that this positive development came at a time when despite the pandemic, the Japan Credit Rating Agency (JCR) found the Philippines deserving of an ‘A-minus’ credit rating upgrade with a stable outlook.
Dominguez expressed the hope that these encouraging developments will “help uplift the Filipino spirit at this difficult time and inspire us to work harder together to emerge stronger and more resilient after the pandemic.”
He said the Philippines’ entry into the “A” rating territory will help the country bring in more foreign investments from Japan and other countries as well as attract more investors to the government’s future bond issuances in the Samurai market.
“This will likewise allow Philippine companies to access funding from Japanese banks at favorable costs and possibly be able to negotiate for good terms,” Dominguez said.
Dominguez congratulated Sia for pushing ahead with his IPO, a move that will allow the company to raise funds for its ambitious plan to build 100 MerryMart branches by 2021.
“I had the chance to visit the first Merry Mart branch when it opened at the Double Dragon Plaza (in Pasay City) last year. I was impressed by this effort to cut a niche between our large supermarkets and the convenience stores that proliferate in our cities and municipalities,” Dominguez said.
Besides MerryMart, Sia is also behind the CityMall chain of community shopping centers.
MerryMart is part of Injap Investments, which is one of the parent firms of DoubleDragon Properties Corp.