MYNT Inc. is expected to sustain earnings growth after its stock market debut, although that may increasingly depend on the company generating more revenue from existing users rather than from acquiring new customers, analysts said.
The operator of e-wallet GCash is scheduled to list its shares on the Philippine Stock Exchange (PSE) on Tuesday following its initial public offering (IPO) at a price of P6.60 apiece. Local brokerages noted that the domestic portion was heavily oversubscribed by retail investors.
Investment banker Stephen Cuunjieng said investors who take a long-term view of the company could benefit from its scale and efficiency, even as growth moderates with the business reaching maturity.
“Shareholders who are patient will probably be happy because it is a different kind of financial services company that is very efficient and has fantastic scale,” he said in an interview with ANC’s Market Edge.
Cuunjieng said Mynt’s challenge would increasingly be to raise its average revenue per user (ARPU), given GCash’s extensive reach in the domestic market. He added that strong investor demand for the IPO at the offer price reflected the company’s business fundamentals.
Mynt offered approximately 9.23 billion primary and secondary shares at P6.60 each, with the transaction valued at about P60.9 billion if the overallotment option is fully exercised. The offering includes primary shares that will provide fresh capital to the company and secondary shares sold by existing shareholders.
The primary offering is expected to generate about P10.6 billion in gross proceeds for Mynt, which the company intends to use for its expansion.
Eric Jurado, hedge fund manager at SeA (Southeast Asia) Focus Portfolio, said Mynt’s large user base, expanding financial services and the continued shift toward digital payments could support earnings growth over the longer term.
“Its historical earnings growth and returns on equity offer evidence of its ability to generate profits. The longer-term question is whether it can sustain those results while continuing to innovate, manage risks, and grow earnings per share,” Jurado said.
He said GCash had become part of Filipinos’ daily financial activities, while its expanding network of users, merchants and partners could make the platform more useful and create additional revenue opportunities.
Jurado added that digital financial services could help small merchants accept electronic payments, simplify consumer transactions, and broaden access to financial products.
“As the network grows, more users can attract more merchants and partners, while additional services can make the platform more useful to existing users,” he said.
Jurado said the company’s long-term performance would depend on its ability to maintain earnings growth while managing risks and continuing to develop its services.
Meanwhile, Jonathan Ravelas, senior adviser at Reyes Tacandong & Co., highlighted GCash’s role in financial inclusion and sustainability, saying its digital services could help bring more Filipinos into the formal financial system.
GCash offers access to digital payments and a range of financial services, including savings, investments, insurance and credit, helping users and small businesses participate in the digital economy.
Ravelas also cited the company’s partnership with the International Finance Corp. (IFC) and Ant International to develop a Sustainability Impact Scorecard for Philippine micro, small and medium enterprises (MSMEs).
The initiative aims to help businesses assess and improve their environmental, social and governance (ESG) performance, potentially widening their access to sustainable financing and investment.
He also pointed to GCash’s GForest program, which supports environmental initiatives through its digital platform.
“By promoting financial inclusion, supporting environmental initiatives, and fostering responsible digital governance, it contributes to a more sustainable and inclusive Philippine economy,” Ravelas said.
The IPO’s international joint global coordinators and joint bookrunners were Morgan Stanley & Co. International plc, J.P. Morgan Securities plc and UBS AG Singapore Branch.
Jefferies Singapore Limited, CLSA Limited and HSBC Singapore Branch served as international joint bookrunners, while BPI Capital Corp. and BDO Capital & Investment Corp. acted as domestic lead underwriters and joint bookrunners.
