Newly-listed cement manufacturing firm Cemex Holdings Philippines Incorporated announced during its debut on the Philippine Stock Exchange (PSE) that it will spend $300 million to build a new cement plant with annual capacity of 1.5 million metric tons.
Cemex Philippines president and CEO Pedro Jose Palomino said the plant will be operational by the second half of 2019 and funded using the company’s cashflow. Palomino said the company is very positive on the domestic economy as the current administration vows to continue to sustain growth across the country. “We think the Philippines is a growth case.We believe that what is happening now has no u-turn, and the growth pace could even be higher. Our goal is try to grow with the country and join the whole community in this growth,” Palomino said.
Palomino noted that Philippine cement consumption is among the lowest in the world at 240 kilos per person per year. The share price of Cemex during its first listing day closed higher by 3.16% to P11.10, from its initial public offering (IPO) price of P10.75 per share. Palomino said the company is “very much happy” with its offering as both the international and local tranche of the IPO were oversubscribed. Cemex Philippines raised P25.13 billion in the Philippines’ biggest IPO since 2013.
It offered over 2.3 billion shares, including 304 million shares to cover additional demand. The IPO shares represent 45% of the company’s capital stock. Meanwhile, the IPO of Cemex Philippines is expected to encourage other companies that deferred their IPO plans to pursue their listing plans as well as lure more companies to list with the PSE. Several IPOs had been put on hold due to market volatility, including Datem Incorporated, DM Wenceslao & Associates Incorporated, Philippine Primark Properties Incorporated, and TVI Pacific Incorporated.
Cemex Philippines is the second company to list with the PSE this year. PSE chief operating officer Roel Refran said they are hoping that more companies will raise funds through the stock market amid favorable market conditions.
For 2016, the PSE is targeting P200 billion worth of capital to be raised through the stock exchange, including IPOs, preferred shares offering, rights offering, and private placements. The Philippine bourse is the second best-performing in Southeast Asia, gaining 15.5% year-to-date, next only to Thailand’s 15.8%. — Rappler.com