By Abigail Marie P. Yraola, Researcher
SOLAR PHILIPPINES Nueva Ecija Corp. (SPNEC) ended up as the second most actively traded stock in the Philippine Stock Exchange (PSE) from the trading week of Dec. 20-24 following its market debut on Friday the week before.
PSE data showed a total of 1.25 billion SPNEC shares worth P1.40 billion were traded last week.
The local bourse had a half-day trading session last Friday in observance of Christmas Eve.
The stock closed at P1.15 per share on Friday, up 15% from its initial public offering (IPO) price of P1 per share.
“Ultimately, SPNEC performed well upon listing, closing higher for several consecutive sessions. This could mean that the public debut was well-received by investors and sentiment for these smaller types of issues is relatively bullish,” said Regina Capital Development Corp. Head of Sales Luis A. Limlingan in an e-mail.
“With the increased index volatility [last] week, there could have been a rotation out of blue chips and into smaller issues like SPNEC,” he added.
Mercantile Securities Corp. Analyst Jeff Radley C. See sees this as a “pure renewable energy play.”
“In addition, we are seeing a lot of big names partnering with the company which will speed up its goal,” Mr. See said in a separate e-mail.
SPNEC is the first company to be listed in the exchange without operations. It generates solar energy from its own solar plant and sells it through bilateral contract to its consumers or to the spot market.
The company sold 2.7 billion shares in its IPO for P1 apiece. Its offer was oversubscribed, reaching a total of P5.3 billion in orders.
Net proceeds from IPO will finance a 500-megawatt (MW) solar power plant and will be used to acquire a lot in Nueva Ecija for the project.
The Nueva Ecija project is said to be the largest among the first 1-gigawatt projects of Solar Philippines, which is targeted to be operating by 2022.
SPNEC is the first company to receive approval to list under the PSE’s Supplemental Listing and Disclosure Requirements for Renewable Energy (RE) Companies that was approved in 2011, which allows development-stage project companies to list, subject to certain requirements.
Its other projects include an operational 63-MW plant in Batangas in partnership with Korea Electric Power Corp., one in Tarlac with Razon-led Prime Infrastructure Holdings Corp. that is being expanded up to 200 MW, and two more in Batangas and Cavite with a combined capacity of 140 MW expected to be fully operational by 2022.
Last Wednesday, the company said it is preparing a 1,000-hectare land as it gears up for a joint venture with an unnamed company to expand the capacity of its solar farm beyond 500 MW.
“Traders are very bullish when it comes to renewable energy ventures as these are fundamentally sound in relation to the transition to cleaner energy in the future. The news of SPNEC’s 1000-hectare expansion likely helped buoy the stock’s share price and remain elevated relative to its IPO price,” Regina Capital’s Mr. Limlingan said.
“Generally, more updates about its planned solar plant and possible deals in the future would attract the interest of the investing public,” he further noted.
Mr. Limlingan placed the stock’s primary support at P1.10 per share, secondary support at P1 per share, and resistance at P1.20 per share.
For Mercantile Securities’ Mr. See: “The company’s price might move sideways for now between P1.10 to P1.20.”
