PSE Expects More Companies to Go Public After Amendments to Listing Rules

The Philippine Stock Exchange (PSE) made necessary amendments to listing rules and added a temporary relief clause when considering companies who will apply during the pandemic. It expects that these changes will prompt more companies to raise capital through initial public offerings (IPO).

There is a lower number of companies listing on the stock exchange, which leaves the Philippine market running behind, said PSE President and CEO Ramon S. Monzon.

“To address this issue, we relaxed certain requirements for listing in both the Main and SME boards and we introduced a measure that will gauge a company’s suitability for listing despite the challenges it is facing due to the pandemic,” said Mr. Monzon on Tuesday.

“With this, we hope to attract more companies to dip their foot in the water and consider the stock market as their preferred avenue for capital raising,” he added.

The PSE will be holding a round table discussion this month titled “The Road to IPO”, which will be separated into two parts, to further explain the amendments.

“On April 7, top PSE executives and its listings team will take the lead in the information session to discuss the amended listing rules together with officers of investment houses, sponsors for listing applicants in the Small, Medium, Emerging (SME) board, and other key members of IPO deal teams,” the exchange said.

The second part of the round table discussion will focus on the officials of listed companies who will discuss their successful IPO stories to interested listing applicants. This is set for April 27.

According to Mr. Monzon, “It is important for business owners to know firsthand what it takes to go public from those who have been through the IPO route.”

The PSE has also included guidelines for companies that will decide to list through a sponsor in the amended rules for listing. Sponsoring companies are expected to do their due diligence to determine an applicant’s suitability for listing before endorsing them to the PSE.

“This listing format will be beneficial to SMEs and start-up companies that have very good profitability and expansion potential but could not tap the stock market for funding because they do not qualify to list based on the set criteria,” said Mr. Monzon.

Source: Business World