According to Business Journalist David Rose, several companies may be gearing up to return to the equities market to raise additional funds.
Speaking on Taking Stock, Rose highlighted that several companies have sought to raise their authorised share capital over the past year.
Authorised share capital is the maximum number of shares a company can issue to stakeholders.
Rose noted that this is typically a precursor to a new equity raise, possibly an additional public offer or rights issue.
He said that VM Investments, Stanley Motta and Main Events are among some of the companies that have sought to increase their share capital recently.
He noted that working may be looking for additional capital as high interest rates, tight liquidity and inflation have made doing business harder. The Bank of Jamaica has gradually started decreasing interest rates, however, the impact of that may not be felt for several months.
Despite the need for additional capital, Rose said companies might be hesitant to return to the market amid investors' lukewarm approach to the stock market.
The two most recent APOs were not well received.
138 Student Living raised just over $510 million last October 2023, a fraction of its $2.15 billion target while NCB Financial Group raised $2.5 billion in its June 2024 APO which was about half of its $5.1 billion target.
Rose noted that companies may hold off on immediately returning to market until investor sentiment improves.