The IPO bandwagon: Ride or die? Buy or bye?
EYES WIDE OPEN - Iris Gonzales (The Philippine Star) - September 16, 2019 - 12:00am

The country’s investment bankers aren’t popping the champagne bottles just yet or drinking their Macallan straight up, but they’re certainly walking tall again and flashing their trademark swagger smiles that say, “Hey, we’ve got deals coming up.” 

Welcome to Manila’s capital market which is starting to perk up again.

One can’t blame these dealmakers for being extra giddy with excitement nowadays. For years, they didn’t have much on their plate except one or two IPOs or initial public offerings a year.  On really bad days, the few deals they made would turn out to be nothing but thuds. 

Indeed, Manila has yet to see the return of the stock market gold rush of the early ’90s when one could make millions in a single trade, when IPOs soared to dizzying heights, and when the only problem was where to put all the money you’ve made. 

Investment bankers and ‘tsupiteros’ alike could only look back to the olden days with nostalgia and melancholy. 

IPO fever 

In 1993 for instance, the market saw the historic stock market debut of Lopez-owned Benpres Holdings, which opened at P12 per share or way above the P3.50 offer price.

A year after, 21 companies listed on the stock exchange, raising P37 billion. They include some of the biggest names in the market now -- SM Prime, Universal Robina and Aboitiz.

IPO bandwagon

Now, after a long hiatus, the circus is in town again and the IPO bandwagon is here. 

The question on everyone’s minds now is if it’s worth joining the wild rumpus -- ride or die? Buy or bye?

Investing in the stock market is a lot like gambling, but better. Unlike in poker, for instance, where you can’t see the cards, stock market investors can at least look at companies’ fundamentals. 

So let’s take a look at some of these companies in the IPO pipeline.

All Home

The home depot chain is owned by the country’s richest man Manny Villar and that alone is a plus. One can’t argue with success.

All Home has room to grow and has a captured market – the Villar Group’s residential communities which want to be present in all the cities around the country. 

However, the indicative P16 per share price may be high at 69 times P/E compared to the retail sector’s 25 times, according to a report by stock market guide PinoyInvestor.


Last week, I met Axelum’s chairman Romeo Chan during the company’s IPO briefing.

Mr. Chan, I learned from our brief chat, is an Atenean who knows very well the ills of society because together with the late Ed Jopson, he was a student activist who fought the dictatorship. During those years, he became aware of the plight of the poor and the marginalised, including Filipino farmers. 

Thus, he said, he is proud that Axelum, a coconut product manufacturer, is able to help coconut farmers. 

I believe Axelum’s prospects are rosy because demand for coconut products will continue to grow as more people look for healthier alternatives. 

Of course there are risks such as supply disruptions and increase in prices of raw materials.

As for the price, brokerage firm Unicapital said the P6.81 per share offer price may be high.

“We think that a P/E range of 20 times to 21 times or around P3.96 per share to P4.16 per share would be a good price range to buy the stock,” Unicapital’s UTrade said in a report.


Fruitas is the market leader in the Philippine food cart business with many popular brands in its name.

In 2018, Fruitas reported P1.58 billion in revenue, a strong 37 percent increase from P1.15 billion in 2017.

Piper Chaucer Tan of Philstocks Financials said it’s good that Fruitas wants to use the proceeds for expansion and introduce new business concepts. The downside, he said, is that these new ideas may not be 100 percent profitable. 

MPIC Hospitals

Everyone’s been waiting for MPIC’s hospital unit to list in the stock market but grapevine talk says the IPO isn’t a done deal yet. It will depend on MPIC’s discussions with private equity funds, so goes the buzz. But a company source says an IPO might even proceed sooner than the market expects. We’ll just have to wait and see.


There’s indeed a robust pipeline of IPO-bound companies, but whether or not the IPO fever is back remains to be seen. 

But I hope that once they’ve listed, these companies will stay and not delist later on after taking investors’ hard earned money. 

It’s really unfair when companies just pack their bags and do a tender offer that is unreasonably low. Regulators should ensure that listed companies will at least offer shareholders a fair price for their money. 

But for now, investors can join the IPO bandwagon and enjoy the ride. It may be a gamble, but it certainly is better than putting one’s cash in the growing number of unauthorised investment schemes in the country. 

Sure, these schemes promise easy money, but in the end turn out to be nothing but investment scams perpetrated by silver-tongued thieves. 

Iris Gonzales’ email address is Follow her on Twitter @eyesgonzales. Column archives at 

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