Mynt's IPO: A Landmark Listing for GCash's Parent Company

Mynt Inc., the operator of the popular e-wallet GCash, is scheduled to list its shares on the Philippine Stock Exchange (PSE) on October 20. The company has priced its shares at P6.60 (approximately $0.11), aiming to raise around P60.9 billion if an overallotment option is fully exercised. Local brokerages reported heavy oversubscription from retail investors for the IPO.

Investment banker Stephen Cuunjieng said investors with a long-term perspective could benefit from Mynt’s operational scale and efficiency, despite the company nearing maturity in its growth phase. He noted that 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.

“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.”Stephen Cuunjieng, Investment Banker

Analysts have pointed out that while Mynt's growth may moderate, the company’s ability to increase its average revenue per user (ARPU) will be crucial. Hedge fund manager Eric Jurado emphasized that GCash has become integral to the daily financial activities of many Filipinos. He said as the network grows, more users can attract more merchants and partners, while additional services can make the platform more useful to existing users.

Mynt's IPO offering comprises approximately 9.23 billion primary and secondary shares, with the primary shares expected to generate about P10.6 billion for the company, which it intends to utilize for expansion efforts. The demand for the IPO reflects strong investor confidence in Mynt's business fundamentals, as highlighted by its historical earnings growth and robust returns on equity.

“As the network grows, more users can attract more merchants and partners, while additional services can make the platform more useful to existing users.”Eric Jurado, Hedge Fund Manager

GCash has played a pivotal role in promoting financial inclusion in the Philippines, providing access to a variety of financial services such as savings, investments, insurance, and credit. Jonathan Ravelas, a senior adviser at Reyes Tacandong & Co., highlighted the platform's significance in integrating more Filipinos into the formal financial system. He said by promoting financial inclusion, supporting environmental initiatives, and fostering responsible digital governance, it contributes to a more sustainable and inclusive Philippine economy.

Mynt has also partnered with the International Finance Corporation (IFC) and Ant International to create a Sustainability Impact Scorecard aimed at helping micro, small, and medium enterprises (MSMEs) enhance their environmental, social, and governance (ESG) performance. This initiative could broaden access to sustainable financing and investment opportunities for these businesses.

“By promoting financial inclusion, supporting environmental initiatives, and fostering responsible digital governance, it contributes to a more sustainable and inclusive Philippine economy.”Jonathan Ravelas, Senior Adviser at Reyes Tacandong & Co.

The IPO has garnered interest from both domestic and international investors, with substantial pre-commitments from major financial institutions. This includes commitments from Capital Research and Management Co., HSBC Global Asset Management, and local players like BPI Asset Management and Trust Corp.

The Philippine Stock Exchange (PSE) has expressed optimism about the listing, anticipating that it will invigorate the local equities market, which has seen a significant decline in capital raised this year. PSE President Ramon S. Monzon said he hopes this landmark listing will pave the way for more fintech and digital economy firms to go public and raise capital through the equities market.