After a two week book building process that ended on March 12, the offering price for the upcoming Phnom Penh Water Supply Authority (PPWSA) IPO was finally released on Monday.
PPWSA will be offered at a price of 6300 KHR, coming in at almost the top of the expected range of 4050-6350 as listed in the prospectus. This is not a surprise given that this is the first opportunity to invest in Cambodia’s new public equity market. Extensive marketing around this IPO from the roadshow to over 200 investment seminars held to educate the general public also helped spur demand.
The subscription period for shares began 8 am on March 29 and will run until 5 pm on April 4. Of the 13,045,975 shares that will be sold (representing just 15% of total equity, the remainder being held by the government), 10% will go to PPWSA employees, while 63% has already been claimed by successful investors during the book building process.
That means just 3,522,413 shares, or 27% of the total IPO allocation, will be available for new investors during this time. With the SECC reportedly inundated with new investor applications ahead of the IPO on April 18, we expect that demand will exceed the remaining supply. Whether the price still represents value is another story, and a topic we intend to explore further soon.