Kepwealth shares up 37.28% in PSE debut

Shares of property developer Kepwealth Property Phils. Inc. (KPPI) became the first company to go public this year, trading higher most of the session on Monday.

As of 2:30 p.m., KPPI shares were trading up P2.14 or 37.28% at P7.88 apiece. Kepwealth opened at P5.87 per share, up 2.26% from the initial public offering price of P5.74 per share.

Timson Securities Inc. trader Jervin de Celis noted the upward momentum was fueled by demand from day traders.

“I guess it’s the day traders who are taking advantage of the wide price range today, as well as retail investors who are chasing the price,” he said.

Analysts earlier this year said that more companies are expected to go public this year should economic conditions improve, after only one—D.M. Wenceslao and Associates Inc. (DMWAI)—pushed through in 2018.

Despite giving a warm welcome to Kepwealth, the market will still have to consider other factors if and when other companies decide to go public this year, De Celis noted.

Can the market absorb more IPOs this year?

“I think it will still depend on the overall trend of the market and investor’s sentiment,” De Celis said.

The company gained regulatory approval from both the Philippine Stock Exchange Inc. (PSE) and the Securities and Exchange Commission (SEC) for its maiden share sale in July.

“… The Philippine Stock Exchange is instrumental in helping KPPI achieve its growth strategy,” PSE chairman Jose Pardo said in a separate statement.

Kepwealth generated P384.77 million from 67.032 million shares at an offer price of P5.74 per share.

The proceeds from the IPO will be used to diversify the company’s assets, and partially finance its office leasing portfolio by acquiring more space.

“Expanding its leasing portfolio bodes well for the company, especially as prospects of the property sector remains upbeat,” Pardo noted.

“The growth potential of KPPI will surely be promising once additional revenue is generated from its planned acquisitions,” he said. —Jon Viktor Cabuenas/VDS, GMA News