Japanese firms eye local equities market

MANILA, Philippines - More Japanese firms have expressed their interest in the local capital market following a roadshow early this month which allowed Japanese investors to learn more about company growth prospects and listing procedures.

“The feedback seems to be very good in terms of interest in participating in these companies,” Philippine Stock Exchange (PSE) president Hans B. Sicat said.

“Maybe they were unaware of the Philippines: our country on the first level and at the second level, there are also questions on potential dual listing or having subsidiary companies raise funding from the exchange by issuing equities or debt securities in the Philippines,” Sicat said.

Major debt watchers Fitch Ratings, Standard & Poor’s, Moody’s Investor Service and Tokyo-based Japan Credit Rating Agency Ltd. last year gave the Philippines an investment grade rating.

Despite the consolidation of the local stock market, Sicat said the PSE is still hopeful of a robust lineup of capital raising activities this year.

“We’ll leave it to various issuers to do their stuff. But the good news is even with the emerging market volatility in the past few weeks, I think it’s a bit of an over reaction,” Sicat said.

In general, investors are still optimistic on the overall economy of the Philippines, a development that will support capital raising activities in the local bourse.

The PSE targets to facilitate capital raising initiatives that will generate around P200 billion this year through initial public offering and follow-on share sale.

As of mid-August, capital raised through the local bourse amounted P31.27 billion, just one-third of the P91.13 billion a year ago.

In 2012, capital proceeds from private placement, stock rights offerings and follow-on offerings hit P50.38 billion, P52.07 billion and P92.64 billion, respectively.

Since ending 2013 at 5,889.83, the benchmark PSE index has improved to 6,308.36 as of Friday given strong corporate earnings and strong economic growth amid worries of slowing growth in emerging markets.