MANILA, Philippines - Century Pacific Food Inc., the Philippines’ largest canned goods producer, is set to debut in the local bourse this week after completing a P3.2-billion initial public offering (IPO).
The bookbuilding and offer period of the second IPO this year was met by strong demand that would translate to favorable prices come trading time, underwriters said.
“The Century Pacific IPO was greeted with overwhelming demand with a three times oversubscription at bookbuilding,†said Roberto Juanchito Dispo, president of underwriter First Metro Investment Corp.
Actual demand during the offer period might have been more than three times, said Eduardo Francisco, president of underwriter BDO Capital and Investments Corp.
Francisco said investors affirmed their confidence on the strength of the consumer sector and continuous growth of the Philippine economy.
Century Pacific raised P3.157 billion in fresh capital from the sale of 229.654 million shares on April 23 to April 29. The company’s shares is set to debut on the main board of the Philippine Stock Exchange on May 6.
DoubleDragon Properties Corp. was the first firm to conduct an IPO this year, while Top Frontier Investment Holdings Inc., the majority shareholder of diversified conglomerate San Miguel Corp., listed by way of introduction in January.
The IPO price of P13.75 per share represents a price-to-earnings ratio of 20x, a significant discount compared with peers that go as high as 30x, Dispo said.
“The issuer is clearly leaving money on the table, and a lot of money at that,†Dispo said.
Proceeds from the IPO would be used to pay short-term obligations, complete a tin can manufacturing factory and dairy mix plant facility in Taguig, and support general working capital given an intensified marketing and sales initiative or possible acquisition.
Century Pacific is banking on its market leadership in the consumer-based Philippine economy, and multi-category, multi-brand product portfolio with a strong record of product innovation and successful new product introduction.
Century Pacific, the company behind Century Tuna, Argentina and 555, is the Philippines’ largest producer of canned goods cornering 84.1 percent of the domestic canned tuna market, 42.5 percent for corned beef and 25.6 percent for meat loaf.
The Po family’s canned goods producer plans to also expand its presence in other market segments like coconut water and premium meat products.
Last year, profits of Century Pacific hit P690.29 million as net sales reached P19.06 billion.
Century Pacific started operations in 1978 when businessman Ricardo S. Po Sr. set up Century Canning. Other brands of Century Pacific include BlueBay, Wow, Birch Tree, Angel, Fresca, Lucky 7 and Shanghai.