DIGIPLUS Interactive Corp.’s board has approved a share buyback program price as much as P6 billion following a recent decline in the corporate’s share price.
The share buyback program might be valid for a 12-month period and will be renewed, subject to board approval, the Tanco-led digital entertainment provider said in a disclosure on Monday.
DigiPlus said the share buyback program “underscores the corporate’s strong balance sheet and commitment to maximizing long-term shareholder value.”
It is going to be funded through the corporate’s internally generated money flows.
“The share repurchase program demonstrates our firm confidence in DigiPlus’ long-term growth and solid fundamentals,” DigiPlus Chairman Eusebio H. Tanco said.
“By strategically deploying our capital through this buyback, we’re sending a transparent signal that DigiPlus is committed to delivering sustainable returns to shareholders while remaining well-positioned to pursue expansion and innovation,” he added.
On Monday, DigiPlus shares rose by 14.58% or P4.30 to P33.80 apiece, following the share buyback announcement.
This was an improvement from Friday, when DigiPlus shares fell by 23.87% or P9.25 to P29.50 apiece.
DragonFi Securities, Inc. Equity Research Analyst Jarrod Leighton M. Tin said in a Viber message that DigiPlus announced the share buyback following a decline in its share price, which got here amid the filing of proposed laws targeting online gambling.
“The move offered some relief to investors, with shares rebounding today. Nevertheless, the buyback appears modest relative to the recent extraordinarily high trading activity. DigiPlus has been seeing P2 billion in day by day value traded, meaning this system may only cover three trading days’ price of value traded,” he said.
“Whether this helps ease selling pressure and stabilize volumes stays to be seen within the short term,” he added.
“Like all other buyback, this sends a signal to investors that the corporate is willing to step in and support the share price,” AP Securities, Inc. Research Head Alfred Benjamin R. Garcia said in a Viber message.
Lawmakers have recently filed bills in each chambers of Congress searching for to limit or ban online gaming platforms, prohibit electronic wallet platforms from promoting gambling apps, raise the legal gambling age, and increase the minimum cash-in requirement.
Malacañang said on Monday that President Ferdinand R. Marcos, Jr. supports measures geared toward curbing online gambling addiction amongst Filipinos.
Last week, the Department of Finance said it’s considering the introduction of a web based gaming tax and can also be reviewing policy options to limit unrestricted access to digital gambling platforms.
DigiPlus operates the sports betting platform ArenaPlus, the digital bingo platform BingoPlus, and the web gaming platform GameZone. — Revin Mikhael D. Ochave