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RLC Stock Rights Offering


By: Marvin Germo | January 31, 2018

RLC prices stock rights offering at 16% discount

The Philippine Stock Exchange (PSE) authorized Robinson’s Land Corporation (RLC) last January 10 with its stock rights offering up to P20 billion. The said offering will run from February 2 to 8 with a price of P18.20 per share. Its value is based on the stock’s volume weighted average price as of January 24 which is discounted by 16%. One rights share will be available to every 3.7217 existing common share held as of January 31. The tentative listing date is set on February 15. (If you want to know more about SROs, click this link)

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The core reason for the stock rights offering is that the proceeds will be used to finance the acquisition of land in various parts of the country for its business segments which include commercial centres, residential and office buildings, and hotels. The property developer is authorized to sell up to 1.1 billion common shares to existing stockholders.

JG Summit will purchase all remaining shares

The company will notify who may participate in the offer. If there will be any unsubscribed shares left at the end of the offer period, JG Summit Holdings Inc., RLC’s parent company, will participate and purchase the remaining shares.

BPI Capital Corp. will act as its sole issue manager, bookrunner, and underwriter for the said stocks rights offering.

What has RLC done so far?

RLC ended 2017 with various projects under its portfolio from mall projects down to residential business. It currently has 47 shopping malls and it lately opened a new mall in Tacloban City, Leyte last December 2017 while under its residential business, it has over 70 condominium buildings and housing projects.

The company’s net profit for the first to third quarter of 2017 stood at P4.57 billion which is slightly higher compared to the same period in 2016.



Looking at the chart below, the stock is still pretty much in a downtrend with no buy signal in sight for position traders. Price and momentum oscillators are still denoting a bearish undertone for the stock. Though the stock is down for the count it is still not yet oversold and may experience further downside if the support at 20 does not hold. If the support at 20 fails to hold, there stock could further drop to 18.45 over the short term.

However if the stock somehow, stays above both 20 and 21, the next short term target price could be pegged at 22 to 23.



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