DM Wenceslao shares drop in market debut

Three years after its original target, D.M. Wenceslao & Associates Inc. (DMW) made its public listing, although the company’s shares fell 14.5 percent in its market debut.

The first initial public offering (IPO) this year pushed through amid volatile market conditions in recent weeks, with DMW raising a total of P8.1 billion through the sale of 679.2 million shares or 20 percent of the company’s total issued shares at P12 per share.

“Despite a volatile market environment over the past months, we are extremely satisfied to successfully complete our offering,” DMW chief executive officer Delfin Wenceslao said.

“Nobody has the crystal ball. When we decided to greenlight this project, the markets were trading at the 9,000. The growth prospects did not change. It’s just market sentiment so at the end of the day, we all know that the price went down but that just means we left more money on the table,” he added.

On its market debut, however, the integrated property developer’s shares fell to as low as P9.66 after opening at P11.80 lower than the IPO price of P12.

DMW shares closed at P10.26, down 14.5 percent.

The company originally planned to go public in 2015 but decided to shelve the IPO to a later date.

DMW was earlier targeting a P22.90 per share maximum pricing for its IPO this year, but was later slashed to P12 apiece.

“One of the reasons we proceeded with the IPO is we were confident about the growth trajectory of the company. If you’ll notice in 2015, even though we did not push through, even though we did not get the IPO funds, the company has still substantially grown. We basically doubled our net income from 2015.

Obviously as the base becomes larger, you would see that taper off. But for the time being, at least for the foreseeable future we see that growth is still there,” Wenceslao said.

The net proceeds of its IPO amounted to P7.6 billion after deducting the applicable fees and other expenses related to the offering.