BDO Capital & Investment Corp. president Eduardo Francisco lauded the successful pricing of clean power giant Citicore Renewable Energy Corp. at P2.70 per share, which leaves upside for small investors seeking to participate in the second initial public offering (IPO) of 2024.
He said the decision was also aligned with the request of Philippine Stock Exchange president Ramon Monzon to make IPOs more accessible to retail investors.
Francisco, the investment banker and strategist behind some of the largest local capital market deals, said he was prepared to support the future fundraising requirements of CREC, which controls country’s second-largest solar portfolio.
“CREC has over 1 Gigwatts in their pipeline and a proven track record in development,” he said.
Insider view
Oliver Tan, the co-founder, president and CEO of CREC, said they were satisfied with the IPO price, which values the IPO at P5.4 billion.
“We closed the book yesterday. There was good mix of investors’ profiles,” he told InsiderPH on Thursday.
Analyst view
Alfred Benjamin R. Garcia, head of research at AP Securities Inc., said the 30.4 percent discount to the indicative pricing of P3.88 per share was positive for the IPO.
AP Securities has a buy rating on the IPO with a potential upside of more than 15 percent.
Big picture
CREC, which was established in 2015, is the second IPO this year after OceanaGold Philippines, which was also arranged by BDO Capital.
Moreover, it is the third IPO of company chair and co-founder Edgar Saavedra, who owns construction and engineering-focused Megawide Construction Corp. and Citicore Energy REIT (CREIT).
CREC was supposed to list earlier this year but was delayed due to poor market conditions and an unexpected partnership.
Last March, the Sy family-led conglomerate SM Investments Corp. acquired 28.8 percent of CREIT for P5 billion. These were secondary shares, meaning the proceeds can be used to bankroll CREC’s pipeline.
Major expansion
CREC has seven operating solar projects with a combined installed capacity of 175.5 Megawatts (MW), its financial prospectus showed. It also operates and maintains three assets owned by Citicore Power with an installed capacity of 99.6-MW.
Proceeds from the IPO will be used for investments in solar and battery energy storage systems.
In its latest IPO prospectus, the company lists eight solar projects worth P49 billion that are either ready-to-build or under construction with a total installed capacity of 1,583 MW.
Based on its latest prospectus, the IPO will run from May 27 until May 31, while listing on the Philippine Stock Exchange under the trading symbol “CREC” is targeted on June 7, 2024.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
