Ashford W. Meikle, Staff Reporter
ROSS
YET ANOTHER company has postponed its plans to list on the Jamaica Stock Exchange (JSE) because of the bear market.
This time, potential investors will have to wait a while longer as Sterling Asset Management Limited will not be coming to the market any time soon with its initial public offering (IPO).
"The stock market is really not favourable at the moment to new listings. We don't anticipate that things will change much for the rest of the year. It's going to take some time for the market to recover. So, really we've put those plans on hold for the time being," said Sterling's managing director, Charles Ross. "It's definitely not on for this year," he reiterated.
He was speaking with the Financial Gleaner yesterday at the Terra Nova Hotel at the conclusion of PanCaribbean Merchant Bank's Economic Breakfast Forum.
Ross' comments come in light of the continued plunge in the JSE's Index which, so far, has declined some ten per cent shedding some 10,000 points since the start of the year. In fact, taken on a year-to-year basis, the main JSE market index has declined by some 20 per cent.
He noted that things have changed over the past two years. "Obviously, when the market was buoyant in 2004, early 2005 ... that was a very great time for the market it was very receptive to new issues."
The executive, while declining to give a time frame for Sterling's listing, noted that that the market will have to be more buoyant. "It's still something that we want to do but we want to but we want to do it at the right time. We are not in any particular rush. There is nothing driving us to do it. It will be another year or two before we get back to more positive sentiments in the market."
Commenting on recent IPOs, which have left a trail of disappointed investors, Ross noted, "the bottom line is that one has to be realistic in your pricing. You have to price the issue at a level that represents good value based on the historical ... performance of the company but also leave some value for the new investors."
He also emphasised the importance of information pointing to investors who do not "have sufficient information to make rational decisions."
