Sun | Aug 14, 2022

JBDC aims to list 20 enterprises on junior stock exchange

Published:Friday | June 17, 2022 | 12:08 AM

Valerie Veira, CEO of JBDC.
Valerie Veira, CEO of JBDC.

Twenty companies are being prepped for listing on the stock market by Jamaica Business Development Corporation, JBDC, a state-run support agency and operator of a microbusiness incubator.

The ventures are all part of the agency’s accelerator programme. JBDC wants to create a sort of conveyor network to get the entities formalised and listed on the junior market of the Jamaica Stock Exchange, JSE, aligning with its mandate of nurturing small and microbusinesses in general.

“We have 60 entrepreneurs, and 20 are at the ready stage of listing,” said JBDC CEO Valerie Veira during a panel discussion at the Jamaica Diaspora Conference on Wednesday.

The junior stock market launched in 2009 with the goal of enticing SMEs to list on the Kingston-based exchange. Its biggest enticement is 10 years of corporate tax waivers for the entities that list. Since then, over 40 companies have listed, nearly equalling the number of companies that trade on the main market of the exchange, but account for only a tenth or so of the wealth generated by main market stocks.

As of the end of May, the wealth, or market capitalisation, represented by junior market stocks was $197 billion, whereas the main market was valued at $1.95 trillion and the overall market at $2.25 trillion.

Companies listing on the junior market can raise equity capital of $50 million to $500 million, while benefiting from the tax break, which includes five years of a full waiver of corporate taxes and five years of a 50 per cent tax break.

Veira said that she held discussions with JSE representatives on Wednesday on the matter. The current JBDC accelerator programme is in its fourth cohort, and the agency is in the process of recruiting candidates for the next one.

“So we have our programme set out, but at the moment we have 20. They will be with us for another six months, and we expect many will graduate to join the junior stock exchange,” Veira said.

JBDC seeks to develop business from concept to market and “all the in-betweens,” she added.

The agency ranks enterprises in tiers: Tier 1 moves the company from its concept stage; Tier 2 formalises the company structure, and develops consistency in product and process; and under Tier 3, participants enter the accelerator programme for growth, and possible listing.

“It is at that stage that the accelerators have reached a point of international business; where you can stand 100 per cent behind them, knowing that they will make linkages with the diaspora community,” Veira said.