OceanaGold debuts on PSE in the red

Shares close 6.22% below IPO price; market remains cautious

OceanaGold Philippines Inc. ended in the red during its stock market debut on Monday, with its shares falling more than 6 percent below its initial public offering (IPO) price, signaling a cautious market for companies planning to go public this year.

The company, which is listed under the stock symbol “OGP,” was down 6.22 percent to P12.50 each.

Its IPO price for 456 million secondary shares was at P13.33, raising P6.08 billion. The final price is lower than its initial maximum target of P17.28 per share.

OceanaGold, the local unit of Toronto-listed OceanaGold Corp., is this year’s curtain-raiser for IPOs. It is also the first mining company to go public since 2012.

“We expect our mining operations to provide substantial dividend returns to our shareholders and, most importantly, to continue to give benefits to the government and the communities, ensuring that we realize our purpose of mining gold and copper for the future,” OceanaGold president Joan Adaci-Cattiling said in a statement.

The company is the operator of the Didipio gold-copper mine in Nueva Vizcaya province under a financial or technical assistance agreement with the government.

Juan Paolo Colet, managing director at investment bank China Bank Capital Corp., said the negative first day performance of OceanaGold “shows that equity market conditions remain tough for IPOs.”

“Not even a substantially discounted IPO price could stop the heavy selling,” Colet said in a Viber message. “This might make investors more cautious about IPOs if market sentiment does not improve.”

OceanaGold’s debut comes after Sy family-led SM Prime Holdings Inc. announced it would again delay the $1-billion IPO of its real estate investment trust (REIT) arm.

SM Prime previously said 2024 was “not the right time” to public ly list the REIT, citing high interest rates and market volatility.

Despite the decline in OceanaGold’s share price, Philippine Stock Exchange (PSE) president Ramon Monzon said the listing “comes at a time when prospects for the mining industry are favorable.”

“The local mining sector certainly has a vast potential that can fuel economic growth,” Monzon said in a statement.