By Jenniffer B. Austria and Alena Mae S. Flores
Share prices of First Gen Corp. at the Philippine Stock Exchange yesterday closed below its offering price, weighed down by concerns on the prospects of the power industry.
First Gen, the first company to be listed in the PSE this year, opened at P46.5 per share, down from its initial public offering price of P47 per share. The stock closed 3.2 percent lower at P45.50.
First Gen and PSE downplayed the weak performance of the stock.
“One swallow doesn’t make a summer. It is just the opening bell. I am confident that the strength of the firm will shine through,” Peter Garrucho, First Gen vice chairman and chief executive officer, said.
PSE president Francis Lim said the company would show its fundamentals and eventually recover its losses in the opening day.
Lim said the listing of First Gen coincided with the decision of rating agency Moody’s to maintain a negative outlook on the Philippines.
Analysts, however, said investors were worried about the the delay in the privatization of power generation assets of National Power Corp.
There are also concerns over First Gen’s sole customer, Manila Electric Co. (Meralco), which has been constantly bedeviled by the regulatory nature of its industry.
Earlier this month, the Supreme Court canceled a 2004 order by energy regulators that allowed Meralco, the country’s largest power distributor in assets, to impose an additional charge on users to recoup costs already incurred in the purchase of electricity.
First Gen chief financial officer Francis Giles Puno said the company expects to receive $160 million in proceeds from the IPO.
The Department of Energy yesterday urged energy companies to list in the PSE following First Gen’s IPO.
First Gen offered 180.9 million shares to the public . It was the first equity offering and the first energy company to be listed this year.
Energy Secretary Raphael Lotilla lauded First Gen for undertaking its IPO.
“We hope that this will encourage other energy companies in power, geothermal energy and oil and gas exploration to list in the stock market to be able to help them grow their businesses,” Lotilla said.
He said First Gen’s IPO is a positive sign for the equities market as its success will indeed boost the capital market.
http://www.manilastandardtoday.com/?page=business03_feb11_2006
No comments:
Post a Comment