BUSINESS

PSE eyes inclusive equities market

To support these, a proposed board lot amendment was put in place to cut the minimum investment to buy stocks at the PSE to as low as P100

Maria Bernadette Romero · Jan 3, 2024, 12:20 AM

Photograph courtesy of PSE The bellwether index kicked off the trading year in the green as it rallied by 104 points or 1.6 percent to close at 6,554.04. ‘We welcome 2024 with hopes of a better performance for the stock market. We are also optimistic that our regulator will continue to support the initiatives we will introduce to boost participation and liquidity in the market,’ PSE president and CEO Ramon Monzon said. Ringing the bell to open 2024 trade are (from left): PSE technology division head Philip Driz, PSE capital markets development division head Mark Frederick Visda, PSE counsel Veronica del Rosario, PSE COO Roel Refran, Monzon, PSE issuer regulation division head Marigel Baniqued-Garcia, Securities Clearing Corporation of the Philippines COO Renee Rubio, PSE finance division head Roberto Jose Jimenez and PSE market operations division head Roel Villanueva.

Making the stock market accessible to Filipinos with a saving of at least P100 is the goal of the Philippine Stock Exchange, or PSE, as it pushes the democratization of the bourse which is traditionally the domain of moneyed individuals.

"PSE's strategic priorities for 2024 to 2026 include expanding our product portfolio, improving market liquidity, and pursuing new growth areas. To support these, a proposed board lot amendment was put in place to cut the minimum investment to buy stocks at the PSE to as low as P100," PSE president and CEO Ramon Monzon said.

Once approved by the Securities and Exchange Commission, the proposal will allow retail investors with a limited budget to have access to a wider range of stocks to invest in, thereby increasing their overall participation in the market.

PSE vowed to strengthen its partnerships with financial technology service providers to encourage more people to invest in the capital market.

The PSE, in a memorandum last 9 October, proposed the revision of the board lot sizes to "democratize stock trading" and accommodate mainly those who seek to invest through trading applications some of which are embedded in so-called electronic wallets.

Short selling to fuel trade

The proposal comes as the PSE ramps up efforts to boost liquidity in the exchange by introducing short selling and stock trading via mobile apps.

Monzon said GCash, which registered 76 million users, wanted to reduce the minimum board lot, which may encourage more people to trade.

The PSE said the number of online stock market accounts rose nearly 9 percent to about 1.3 million last year, or around three-fourths of the total, in what the bourse described as "muted growth" compared to previous years.

Average value per online transaction increased 33 percent to about P46,200, according to Monzon.

In August last year, the PSE, in partnership with GCash and AB Capital, launched GStocks to activate the untapped potential of the Philippine equities market by launching an in-app stock trading platform in GCash, with the PSE as a technology provider.

Meanwhile, Maya launched its Maya Stocks feature with Philstocks as the partner broker in November 2023. Maya is set to include 2TradeAsia, DragonFi and Seedbox in the lineup, allowing users to choose their preferred broker.

Expect vibrant mart

More companies are likely to tap the local capital market to raise funds amid anticipated better market conditions due to easing monetary policies.
Monzon said six initial public offerings or IPOs, as well as new Real Estate Investment Funds or REITs, are forecasted this year.
"We are expecting six IPOs for the year, starting with the listing of Citicore Renewable Energy Corporation. Since no new REITs were added in 2023, we hope to see REIT IPOs make a comeback this year," Monzon said.
The anticipated capital raising for the year, according to Monzon, could likely reach P175 billion, P40 billion of which would come from maiden listings.

"Risks to the positive outlook next year remain such as the potential impact of higher transport charges, electricity rates, and international oil prices," Monzon said.
To further attract investments in the capital market, Monzon vowed that the PSE will continue to collaborate with regulators and government entities to implement regulatory reforms aimed at fostering stock market investment.

Among the reforms that the PSE will pursue this year are the reduction of the stock transaction tax from 0.6 percent to 0.1 percent and the reduction of the dividend tax to non-resident aliens from 25 percent to 10 percent to harmonize the cash and property dividend rate.