^

Stock Commentary

Raslag diverts IPO funding to purchase  property in August

Merkado Barkada
Raslag diverts IPO funding to purchase  property in August

Raslag [ASLAG 1.78 2.20%] [link] disclosed that it plans to divert 100% of the P250 million that it had allocated to “funding pre-development work for RASLAG-5” and to “other pipeline solar projects” to, instead purchasing “real property for RASLAG-5”.

The timeline of the original application of the proceeds for that line item was originally between 2022 and 2024, but ASLAG noted that it would look to spend the money on land for RASLAG-5 by the end of this August. No other guidance was provided.

MB BOTTOM-LINE

This diversion comes out of the second-largest line item in ASLAG’s use of proceeds list, just behind the P330 million for “funding the equity portion of RASLAG-4’s development and construction”. Strangely, the original description of the diverted line item in the prospectus doesn’t mention “RASLAG-5” pre-development work, only the very very vague “Funding for pre-development work for pipeline solar projects”.

In the prospectus, ASLAG said that it had already bought the land for RASLAG-5 back in 2018 and 2020. If I were an ASLAG shareholder (full disclosure: I’m not), I’d be asking some questions about the land issue (why they’re buying land for something they said they already had the land for), but  I’d be happy to see the company apply the proceeds of the IPO faster, and I’d be happy to see ASLAG’s future pipeline taking shape in a more concrete way.

Land for RASLAG-5 next month is a lot more tangible and progressive than some vague idea of “pipeline solar projects”. I’d love to know what changed behind the scenes. Might have been something as pedestrian as finding a great lot at a good price that was better than what they already had, and wanting to nail that down as quickly as possible. 

 

--

Merkado Barkada is a free daily newsletter on the PSE, investing and business in the Philippines. You can subscribe to the newsletter or follow on Twitter to receive the full daily updates.
Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.

PHILIPPINE STOCK EXCHANGE

RASLAG CORP.

Philstar
  • Latest
Latest
Are you sure you want to log out?
X
Login

Philstar.com is one of the most vibrant, opinionated, discerning communities of readers on cyberspace. With your meaningful insights, help shape the stories that can shape the country. Sign up now!

FORGOT PASSWORD?
SIGN IN
or sign in with
no session for state
no session for code
no session for id_token
no session for user