Four years ago, the Mexican Stock Exchange (BMV) registered the last Initial Public Offering (IPO); however, since last year it has faced processes of delisting or leaving several companies, such as Bio Pappel, Lala, Fortaleza Materials, Elementia Materials, IEnova, Pochteca, General Seguros and more recently BachocoWhat’s behind this?
Analysts consulted by Forbes Mexico explain that this phenomenon is due to the undervaluation of their shares in the stock market due to factors ranging from expectations of limited growth, the low level of investors in the country and even because they are very familiar companies that “are not as public ”.
According to Carlos González, Director of Analysis at Monex, when growth expectations are high this is reflected in the share priceFor example, the case of Tesla, whose titles are not expected for this year, nor for the next, but for the next 10 or 15 years.
“In the case of our market, The expectation of growth is not very high either if we see it from the point of view of the economic growth that we have had in recent years; Until 3 years ago, we brought an average growth of 2.5% and in the last 3 years it has been practically null and it is expected that throughout this administration it will be null”, he affirms.
Lee: Like Lala and Bio Pappel, now Bachoco is going to leave the BMV
For the specialist, in the case of companies that have operations in the United States or in another part of the world, their estimated growth comes more from the external part than from the local part, since the national part is more limited, which causes their valuations in general market terms are limited.
Carlos González considers that Another issue that generates this undervaluation of companies in the Mexican stock market is that the number of investors has not grownsince although players like GBM have done an interesting job, a greater number is still needed and also a higher average ticket.
“With the exception of the Afores, we do not see those large or medium-sized investors who are in the local market, because precisely because they have the capacity to see other alternatives, including companies from the SIC or in other markets, also even, due to some uncertainty regarding our country,” he explains.
The Monex analyst also believes that the exit of these companies from the stock market has to do with the fact that it is the easiest way to give value to their shareholders, since there are only a few alternatives: lower debt, pay dividends, make greater investments or buy back Actions.
At the same time, CIBanco stock market analyst Benjamín Álvarez Juárez believes that for many companies the issue of being listed on the stock market represented, particularly in Mexico, a status issue more than access to financing, whether it be raising capital or debt; however, at this time it can be more challenging to get your trades on the exchange and stay active.
In this sense, it states that Mexican companies tend to be very familiar, so many times they do not want to remain in floating hands or in the hands of the free market a large position of their capital, so they maintain the minimum of float within the capitalization and that the investing public punishes, particularly by applying a discount to the valuations.
“If a company like Lala, Bioppel, Bachoco wants its valuations to be in line with Mexican companies like Bimbo or Gruma, the market will hardly pay for it because its float it is very small and they are not public like the bigger companies”.
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These are the companies that have bid farewell to the BMV
Last week, Bachoco announced its decision to delist from the Mexican Stock Exchange, joining other companies such as Bio Pappel, Lala, Fortaleza Materials, Elementia Materials, IEnova, Pochteca, General Seguros.
And it is that the poultry company of the Robinson Bours family communicated to the Board of Directors the beginning of the process to celebrate a voluntary takeover bid “for up to all the shares representing the company’s capital stock.
In the case of Grupo Lala, headed by Eduardo Tricio, its shareholders approved on December 13 the cancellation of its titles in the stock market, after the process began in August.
Also read: Lala shareholders approve its exit from the Mexican Stock Exchange
Meanwhile, Santander announced in March its intention to purchase the remaining 8.3% of the shares of its subsidiary in Mexico and the eventual exit from the stock market, however, on June 8 it announced that its plans changed and it will make the offer, but their titles will remain on the BMV.
This December, the CEO of Santander Mexico, Héctor Grisi Checa, explained that although the repurchase offer does not include the delisting part, this process is a decision that will be made by its parent company.
In turn, on September 28, Biopappel received authorization from the National Banking and Securities Commission (CNBV) for the cancellation of the registration in the National Securities Registry of all of its shares, with which they would no longer be listed in the Mexican Stock Exchange.
Meanwhile, on November 24, Elementia Materials reported that the issuer’s delisting was approved at the extraordinary shareholders’ meeting, reaching 98.78% of the shares representing its capital stock.
Also on November 24, the meeting of Fortaleza Materials gave its approval for the release of its securities from the BMV, with the favorable vote of 98.88% of the shares representing its capital stock.
While on October 13, the company Infraestructura Energética Nova (IEnova) received authorization from the CNBV to cancel the registration of its shares in the National Securities Registry, for which they ceased trading on October 15.
The Pochteca company announced on June 29 that it was analyzing the possibility of carrying out a public offer for the acquisition of shares and, in due course, of canceling the registration of the shares in the National Securities Registry and their listing in the BMV. .
While General de Seguros also announced that on May 31 the CNBV authorized the cancellation of its titles and delisting from the Stock Exchange.
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