The National Reinsurance of the Philippines or “PhilNaRe” initial public offering (IPO) set for April 27 has the local retail market scrambling for additional shares, which are actually oversubscribed many times over as of today.

"The PhilNaRe IPO attracted small investors and increased retail demand which is inordinately high compared to historic stock listings," said Warren Sy, president of SB Equities.

"Most brokerage houses and investment entities were not given enough shares to meet the demand of the market," he added.

The tremendous demand from the retail market indicates continuous support for the PhilNaRe stock even after listing day.

The offering has been highly successful, as it has been several times oversubscribed," says BDO Capital and Investment Corp. President Ed Francisco.

BDO Capital and Investment Corp. is the lead underwriter for the IPO.

Throughout the years, PhilNaRe has grown in status as the national reinsurer and the sole reinsurance company of the Philippines. With the help of Presidential Decree 1270, it has the mandate to retain 10 percent of the local insurance industry’s business.

Due to a well-planned Capital Enhancement Program that included fresh capital infusion, a merger and now an IPO, PhilNaRe has always had a fundamentally sound business and growth strategy. Its net income has increased from P211M in 2004 to P316M in 2006, with its total assets increasing from P5.3B in 2004 to P9.1B in 2006. As a policy, the company allots 100 percent of the previous year's income as cash dividend or stock dividend.

For future prospects, PhilNaRe expects to generate P627M this year, nearly double its net income for 2006. This will be mainly due to its ability to retain more premiums and from the move of the local insurance industry, specifically life insurance, to reeducate the market about the investment opportunities present with their products today.