EAGLE Cement Corp. and property developer Cebu Landmasters Inc. are listing their shares on the Philippine Stock Exchange this week, a development that analysts say may help boost sentiment in the market.
Eagle Cement sold 575 million shares for P15 per share in an initial public offering (IPO) that was three times oversubscribed, while Cebu Landmasters offered 505 million shares with an overallotment option of 75 million shares at P5 per share.
“The two IPOs this week … may attract a narrower focus and keep value flows close to the average,” Philstocks Senior Research Analyst Justino Calaycay Jr. said on Sunday.
Online brokerage firm 2TradeAsia said the maiden share sale of Eagle Cement and Cebu Landmasters may bring in much needed liquidity into the market.
“Hopefully, the market can not only sustain the resiliency it displayed last week but use it as a platform to foray into the 7900-8000 range, hopefully testing the upper limit,” Calaycay said.
But Calaycay also underscored the possibility of domestic and external risks. “There is some positives like heightened business confidence about prospects in the second quarter. However, given the time lag, there are some caveats and nuances.”
Optimism hinged on consumer spending must be recalibrated in the face of rising inflation which may dampen discretionary spending, Calaycay noted.
Public infrastructure projects may have to be revisited in light of government’s April fiscal report, he added.
Infrastructure-spending declined by 21.1 percent to P33.5 billion in the absence of big-ticket defense and public works capital expenditures last month, according to the Department of Budget and Management.
Regina Capital Corp. Managing Director Luis Limlingan noted the prospects of month-end window dressing.
“We’re trying to break past 7,900 level, but I think there would be difficulty because technically in the last few days it showed that we’re a bit on the overbought side. So we might see some sell-offs,” he said.
On Friday, the bellwether PSEi was down 0.05 percent or 4.16 points to close at 7,867.49. The broader All Shares decreased by 0.08 percent or 3.51 points to 4,689.88.