After reducing the number of shares for its initial public offering (IPO), Maynilad Water Services Inc. may tighten the offer price to between ₱12 and ₱14 per share from its initially indicated maximum offer price of ₱20 per share based on investor interest during its ongoing bookbuilding process.

If the offer price is reduced, the IPO size will decrease to between ₱27.5 billion and ₱32 billion, down from the ₱45.8 billion in gross proceeds stated in its preliminary prospectus. This figure was already adjusted downward from the initial target of ₱49 billion, following the reduction of the offer shares to 2.29 billion from 2.46 billion.

However, Abacus Securities Corporation stated that it believes there is sufficient demand for Maynilad’s IPO shares at ₱14 per share, as the projected dividend yield of 6.5 percent at this level would be higher than that of other large-cap stocks listed on the Philippine Stock Exchange.

Another stock analyst pointed out that, while there is no official announcement on the price yet, “among us analysts, I would say consensus is around ₱12 to ₱14 per share.”

“I prefer a lower price (to ₱20 per share). It offers a discount to investors, pricing uncertainty despite (Maynilad’s) business being cyclical as a utility,” said Jonathan Ravelas, senior adviser at Reyes Tacandong & Co.

Rizal Commercial Banking Corporation Chief Economist Michael L. Ricafort pointed out that the issuer is expected to seek the highest price possible to maximize funds raised through the stock market, although this also depends on market conditions and investors’ appetite.

“It is so important to have favorable timing especially during times of improved market sentiment. It is a delicate balancing act between the time when funding is needed and also to meet the deadline for listing and fund-raising,” he added.

Based on the prospectus, the IPO dates have been moved back, with the final offering price to be announced on June 30, 2025, while the offer period is tentatively set to run from July 3 to July 9, 2025, with the listing date targeted for July 17, 2025.

Despite seeming tepid demand for its IPO shares, Abacus said the threat of the IPO being postponed is remote since there is no assurance of better pricing next year. Maynilad is mandated to go public by 2027 under its concession agreement.

It noted that, in 2026, market investors’ focus will be on US President Trump’s nominee to replace Federal Reserve Chair Jerome Powell, while, in 2027, focus will start to shift to the buildup for the next presidential election cycle.

Based on its preliminary prospectus, Maynilad is offering a total of 2.29 billion shares consisiting of a primary offer of 1.66 billion new common shares, a preferential offer to First Pacific Company of 24.9 million new shares, an upsize option of 354.7 million secondary shares of shares owned by exisiting shareholders, and an overallotment option of up to 249.05 million shares.

Proceeds from the offering of new shares will be used to fund Maynilad’s capital expenditure program for 2025-2026 which consists of three major pillars: water capex, wastewater capex, and customer service and information system projects capex. A portion of the proceeds may also be allocated for general corporate purposes.

BPI Capital Corporation, HSBC, Morgan Stanley, and UBS are the Joint Global Coordinators and Joint Bookrunners for the IPO. HSBC, Morgan Stanley, and UBS will be the International Underwriters while BPI Capital Corporation will be the Domestic Lead Underwriter.

Maynilad is the water and wastewater services provider for the West Zone of Metro Manila and Cavite, covering 17 cities and municipalities, including Caloocan, Malabon, Navotas, Valenzuela, parts of Quezon City, parts of Manila, parts of Makati, Pasay, Parañaque, Las Piñas, and Muntinlupa—all in Metro Manila; the cities of Cavite, Bacoor and Imus, and the municipalities of Kawit, Rosario and Noveleta—all in Cavite Province.