Leading fiber internet services provider Converge ICT Solutions Inc. (PSE: CNVRG) has qualified for early inclusion in the benchmark Philippine Stock Exchange Index (PSEi) as its market capitalization reached nearly P180 billion at the close of trade Thursday. The pure fiber broadband operator will likewise be included in the Services Index.
The Philippine Stock Exchange (PSE) approved policy adjustments following its July 2020 to June 2021 review, with the change in the PSEi composition taking effect on August 16, 2021. The PSEi is composed of 30 members which represent the largest, most valuable, and most liquid companies in the local exchange.
“This was a pleasant surprise to us as we are really just focused on delivering our commitment to reach the underserved and unserved areas in the country with world-class pure fiber broadband connectivity,” Converge CEO Dennis Anthony Uy said.
Converge is aiming to reach 55% of total Filipino households by 2025. As of end-April, Converge has connected Visayas and Mindanao to its national fiber backbone. It launched its services in Cebu in early-June and expects to commercially roll-out in Mindanao and the rest of the Visayas in the second half of the year.
Converge President Grace Uy noted the early inclusion of CNVRG in the PSEi demonstrates the confidence of both retail and institutional investors in the growth prospects of the company. “We welcome our early inclusion in the PSEi as it reflects the fast growth of the company which we hope to sustain amid our aggressive expansion plans nationwide.”
In the first quarter of the year alone, Converge deployed half a million ports, allowing the pure fiber broadband provider to reach more than 7 million homes or 28% of total households in the country. By the end of the year, Converge aims to connect 1.6 million to 1.7 million subscribers to its end-to-end fiber network.
The PSE said in a statement that the stocks included in the 30-company index are those that meet the free float level, rank among the top 25% by median daily value per month for at least nine out of 12 months, and rank among the highest in market capitalization, plus the relevant financial criteria during the review period.
PSE President and CEO Ramon Monzon said the Exchange “reviewed the index policies of peer exchanges and took note of provisions that will make our own policies more consistent with what was practiced globally.’’
This review resulted in the early inclusion of large issuances, including Converge which listed on the PSE on October 26, 2020 with an offering size of P25 billion, making its Initial Public Offering (IPO) one of the biggest in PSE history at that time. As of August 5, 2021, Converge was the 24th largest company listed on the PSE by market capitalization.
The 30-company PSEi as a broad-based index serves as a barometer of the general state of the business climate in the country. The PSE Services Index is among the main six sector-based indices of the local exchange.
To recall, Converge also earned inclusion recently in the FTSE Asean All-Share Index and the FTSE Renaissance IPO Index, further cementing its reputation as a stable and increasingly valuable company.