Newly-listed cement producer Cemex Holdings Philippines Inc. said Monday it will spend $300 million to build a new plant with an annual capacity of 1.5 million metric tons.
Cemex Philippines president and chief executive Pedro Jose Palomino said the plant, scheduled to be operational by the second half of 2019, would be funded using the company’s cashflow.
Palomino said the company was upbeat on the domestic economy after the new administration vowed to sustain growth across the country.
“We think the Philippines is a growth case. We believe that what is happening now has no U-turn, and the growth pace could even be higher. Our goal is try to grow with the country and join the whole community in this growth,” Palomino said.
He noted that Philippine cement consumption was among the lowest in the world at 240 kilos per person a year.
Share price of Cemex gained 3.2 percent during its first listing day to P11.10 from an initial public offering price of P10.75 apiece.
Palomino said the company was pleased with its offering after the international and local tranches of the IPO were oversubscribed.
Cemex Philippines raised P25.13 billion in the Philippines’ biggest IPO since 2013.
It offered over 2.3 billion shares, including 304 million shares to cover additional demand. The IPO shares represent 45 percent of the company’s capital stock.
Meanwhile, the successful IPO of Cemex Philippines is expected to encourage other companies that deferred their listing plans as well as lure more companies to list with the Philippine Stock Exchange.
Several IPOs had been put on hold due to market volatility. They include Datem Inc., D.M. Wenceslao & Associates Inc., Philippine Primark Properties Inc. and TVI Pacific Inc.
Cemex Philippines is the second company to list with the PSE this year.
PSE chief operating officer Roel Refran said the exchange wanted more companies to raise funds through the stock market amid favorable market conditions.
PSE expects P200 billion worth of capital to be raised through the stock exchange, including IPOs, preferred shares offering, rights offering and private placements.
The Philippine bourse is the second best-performing in Southeast Asia, gaining 15.5 percent year-to-date, next only to Thailand’s 15.8 percent.