SSI Group up over 13% on market debut, banks on consumer-led economy

Shares prices of specialty brand retailer SSI Group Inc. rose on its debut on the Philippine Stock Exchange Friday, and the company is banking on the strong consumption, evolving lifestyle and overall economic growth.

 

These are the signs the company is looking at, goading the retailer to bring in a more diversified basket of international brands and cater to a broader range of the Philippine market.

 

The company has evolved from catering to the upper market to delivering products to and expanding middle income segment, SSI Group president Anton Huang told reporters in a briefing in Makati City.

 

"I think we're in great times, because at this point the upper segment continues to grow. It has always been quite solid, resilient, especially now that the economy is extremely well," he said. "At the same time, we are at this point that our middle income segment is also growing as well, so we're able to tap both.

 

"As lifestyles evolve, it really determines the kind of brands and categories that we choose to work with," Anton noted.

 

SSI Group is making these calls amid the private sector move calling for a shift from consumerism to fuel further economic expansion.

 

In its market debut, share of SSI Group opened at P8.49 apiece and ended the morning trade at P8.07 per share, up 13.2-percent and 7.6-percent, respectively from a listing price of P7.50.

 

The brands retailer raised P7.45 billion from the main IPO of 864.22 million common shares and 129.63 million shares to cover oversubscriptions.

 

"On the institutional side, we were seven times oversubscribed and in the local tranche we were around three times oversubscribed," Huang said.

 

Earlier, BPI Capital Corp. said the offer was five to 10 times oversubscribed by foreign and local fund managers.

 

BPI Capital Corp., Credit Suisse (Singapore) Limited and Hongkong and Shanghai Banking Corporation Limited-Singapore Branch were tapped as joint global coordinators and bookrunners for the exercise.

 

In the same briefing, SSI Group vice president for investor relations Marti Atienza said 38 percent of the total offering is cornerstone investors, namely GSIS, BPI Asset Management, York Capital, Haven Port and Macquarie Fund.

 

Seventy percent of the IPO proceeds will go to the company coffers and 30 percent to existing shareholders, said Atienza. 

 

Of the P5 billion for the company, P2.5 billion will be for capex to roll out of new stores, P1.5 billion for debt repayment, P400 million to be infused in the FamilyMart and WellWorth joint ventures and P300 million for general corporate purposes, Atienza noted.

 

Established in 1987, SSI Group is the main proponent of the Rustan’s Group’s specialty retail operations.

 

The SSI Group now includes Stores Specialists Inc. and retails 103 international brands including, Prada, Gucci, Burberry, Salvatore Ferragamo, Michael Kors, Kate Spade, GAP, Old Navy, Zara, Stradivarius, Bershka, Aeropostale, Samsonite, Nine West, Payless Shoe Source, Beauty Bar, Marks & Spencer, Pottery Barn and TWG.

 

It is also partly operating FamilyMart convenience stores under a partnership deal with Ayala Land Inc. and Japan FamilyMart and Itochu Corporation of Japan.

 

The company recently opened its first Wellworth Department Store, a mid-market joint venture with Ayala Land.  – VS, GMA News