The BTS Rail Mass Transit Growth Infrastructure Fund (BTSGIF), Thailand's largest initial public offering, sizzled at its debut yesterday on the Stock Exchange of Thailand.
Front row from right: BBL Asset Management managing director Voravan Tarapoom, BTS Group Holdings chief executive Keeree Kanjanapas, Stock Exchange of Thailand board chairman Sompon Kiatpaiboon, and Banyong Pongpanich, chief executive of Kiatnakin Bank.
It surged as much as 22% above its IPO price, underscoring investors' strong demand in newly listed securities.
The country's first infrastructure fund was traded at 12.50 baht at the opening bell and surged to the day's high of 13.20 baht per unit trust in the first trading session.
It retreated to close the market at 12 baht, an 11% increase from its IPO price of 10.80. It had the most active trading volume worth 3.26 billion baht.
The positive momentum of the fund, which is backed by revenue from the skytrain's core 23.5-kilometre routes, also boosted BTS Group Holdings shares in initial trading before they closed at 9.15 baht, down 10 satang.
The IPO price was set early this month at the top end of its indicative price range of 10.40-10.80 baht for its 5.79 billion unit trusts, raising 62.5 billion baht.
Keeree Kanjanapas, chief executive of BTS, the skytrain operator, said the company is considering raising its fares because the current range of 15-40 baht has been unchanged for eight years.
He said the new fares would not reach the maximum rate, which is capped at 56 baht, to avoid a big impact on passengers.
The new rates are expected to be finalised within one month.
BTS plans to use the proceeds from the infrastructure fund issuance to finance its expansion, Mr Keeree said, adding that the company may need to borrow from financial institutions as investment in each rail route requires 50-60 billion baht.
The skytrain operator is now debt-free and can borrow up to 100 billion baht, based on its maximum leverage capability.
The skytrain, consisting of 32 stations with a combined track length of 32.7 kilometres, carried 176 million passengers in the fiscal year ended March 31, according to the IPO prospectus. It posted sales of 4.3 billion baht for the period, up from 3.5 billion a year earlier.