Brazil set for more agricultural IPOs, says seed company chief

SAO PAULO, Sept 29 (Reuters) – Brazil’s market is poised to welcome more agribusinesses to the stock exchange, a sector underrepresented on the local stock exchange due to the industry’s size relative to Brazil’s GDP, a said Marino Colpo, general manager of seed producer Boa Safra (SOJA3.SA)said Thursday.

“I’m a big fan of the next window (IPO),” said Colpo, who runs one of the latest agricultural companies to go public.

At a roundtable hosted by an investment bank, Colpo said there was still a great distance between investors and the countryside in Brazil, the biggest producer of commodities like soybeans, coffee and sugar. .

Yet, more and more financial companies are adding agribusiness specialists to their teams.

“More and more, we are in contact with people who are specialists in agribusiness,” Colpo said. “It highlights (the fact) that asset managers and investment funds are prepared for a new arrival of agribusiness companies (on the stock market),” he said.

Brazil’s booming agricultural sector accounts for about 25% of the national GDP, including industries and services, Colpo noted.

For that reason, it’s important for investors to be educated about the sector, where typical crop seasonality often affects company results, he said.

Fabio Nazari, a partner at investment bank BTG Pactual, who moderated the panel Colpo participated in, also expressed confidence in a new wave of agribusiness IPOs.

“The agribusiness sector is underrepresented on the Brazilian stock market, from what it means for Brazil and countries around the world,” Nazari said.

BTG’s credit exposure to Brazilian agribusinesses amounts to nearly 20 billion reais ($3.70 billion), or about 20% of its loan portfolio, said the bank’s CEO, Roberto Saluti.

In two years, BTG has conducted equity offerings for nearly 11 billion reais, he said.

($1 = 5.3991 reais)

Reporting by Roberto Samora; Written by Ana Mano; Editing by Jonathan Oatis

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