IRC Properties, Inc. (IRC): A Backdoor Listing?

IRC Properties, Inc. (IRC) clarified news report from The Philippine Star today. It was about the company eyeing to star the Makati Subway construction in November or December.

In the said article, IRC allegedly hurdled the Swiss Challenge. The company hopes to break ground this November or December.

Antonio Tiu, the company’s chairman, reiterated that no other entity submitted a proposal to match or outbid IRC’s unsolicited offer. Therefore, the company could now proceed to the next stage.

Deal In The Bag

Earlier in the day, IRC Properties confirmed the news. It received the Notice of Award for the consortium and operation of the Makati Subway System through a joint venture agreement.

However, the company is yet to announce the schedule of commencement of operations as well as the groundbreaking activities.

On Friday, IRC established that they are the sole bidder for the Makati Subway Project. Makati City Mayor Abby Binay considers this project as her legacy to the business district.

Capital Infusion and a Backdoor Listing

Moreover, IRC disclosed another critical disclosure. The trading of the stock was put to a halt for investors to process the disclosure.

The transaction involved Aggregate Business Group Holdings (ABG) subscribing to a total of 4,148,105,000 common shares of IRC. It is at a price of PHP 1.10 per share or a total of PHP 4,562,915,500.

Additionally, another corporation (foreign) organized in the Cayman Islands, also subscribed to a total of 368,175,000 IRC common shares. It is for a total of PHP 404,992,500.

These shares will come from the increase in capital from PHP 1.5 billion to PHP 19.50 billion as approved by the BoD of the Corporation. SEC flagged this transaction as a backdoor listing.

Consequently, IRC Properties is required to submit a comprehensive corporate disclosure to comply with the Backdoor Listing Rule.

Technical Analysis

The stock closed and marked a new higher high upon trading suspension today. The moving averages aligned bullishly.

Furthermore, the volume supported the rally. MACD poised for a bullish crossover. RSI is also bullish but is not yet overbought.

Nonetheless, euphoria is already in the stock. When trading resumes, it expects volatility. Next price target for the stock is at 3.00.

Top 10 Players’ Sentiment

Trading participants of IRC with a 100% Buying and Selling Activity as of Oct-23-2018 at 03:30 PM:

5 out of 58 participants or 8.62% of all participants registered a 100% BUYING activity
21 out of 58 participants or 36.21% of all participants registered a 100% SELLING activity
Top 10 Players’ Buying Average: 2.6857
Top 10 Players’ Selling Average: 2.6859

The psychological average price of the top 10 players as of Oct-23-2018 at 03:30 PM is from 2.6857 to 2.6859.

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