Coronavirus catches up on 'Injap' Sia's blockbuster IPO
MANILA, Philippines — Businessman Edgar “Injap” Sia failed to repeat his pandemic streak last year and saw the maiden sale of his real estate investment trust (REIT) firm unable to dazzle investors worried about a new wave of coronavirus cases.
The IPO blockbuster maker listed his DDMP REIT Inc. for the first time on Wednesday, but failed to hold on to gains that reached as high as 6.7% while trading. The market closed with DDMP REIT shares steady as offered at P2.25 each.
“Listing during a pandemic is definitely not a walk in the park, but we believe this is our share of also promoting a more inclusive economy,” Sia said during the listing ceremony early in the day.
For Anna Corenne Agravio, property stocks analyst at Manila-based brokerage Regina Capital, DDMP REIT only reflected the downbeat mood in the main index throughout the day. The benchmark index closed up 0.79% after cutting some losses in the morning trade.
“DDMPR wasn’t able to sustain its intra-day rally because of prevailing market sentiment, which is slanted on the downside because of the pandemic and related mobility restrictions,” Agravio said in a Viber message.
“Nonetheless, the relatively high value turnover today shows how strong the appetite is for stable, dividend-paying stocks,” she added.
Expectations were high for DDMP as Sia’s previous ventures into the trading platform were a hit, most notably that of grocer MerryMart Consumer Corp. that bucked pandemic uncertainties last year. That firm, as well as DoubleDragon Properties Corp. that went public in 2014, hit their ceiling price on their first trading day.
DDMP holds office spaces as its main portfolio. These assets, in turn, generate revenues, 90% of which should be declared as dividends to REIT investors. Over 50,000 accounts subscribed to the much-awaited IPO that raised a total of P14.7 billion.
It was the second of its kind in the Philippines, surpassing proceeds from pioneering Ayala-backed AREIT Inc. Gotianun-led Filinvest Land Inc. is most likely to be next after announcing REIT plans early this month.
The growing list of REIT intentions was welcomed by Finance Secretary Carlos Dominguez III, who made fixing the much-delayed REIT regime a priority. The REIT law was signed in 2009, but disagreements between government and private sector over required public float and tax treatment on transferred properties made it unattractive to investors until settled recently.
“REITs are indispensable to rebuilding a strong and truly inclusive economy for our people. These will make available huge volumes of capital to our financial system that will help fund our long term growth,” Dominguez said in his speech during the listing ceremony.
Moving forward, Agravio believes things would get worse for DDMP before they get better. “It is possible that DDMPR could dip below its IPO price again this week, but we don’t expect this to last in the near-term since the stock itself is in a good position fundamentally,” she said.
“The first few days after listing are, after all, always the most volatile in terms of price shocks,” she added.
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