Displaying items by tag: Business

Eagle rises on debut, preys on top prize

 

Shares of Eagle Cement Corp., which aims to be the country’s leading cement producer in the next few years, outperformed the stock barometer on inaugural trading yesterday.

Eagle gained P0.30 or 2 percent to close at P15.30 per share from its initial public offering price of P15 per share. It was the most actively traded company, with total traded value reaching P967.95 million.

The cement firm opened at P16 and hit a high of P16.12, but gave up earlier gains as some investors pocketed gains. Based on yesterday’s closing, the firm had a market capitalization of P75 billion.

On the other hand, the main-share Philippine Stock Exchange index added 18.54 points or 0.24 percent to close at 7,886.03.

Eagle’s offering was oversubscribed by over three times the base offer, its president John Paul Ang said in a press briefing after the company’s listing on the Philippine Stock Exchange (PSE).

Eagle chair Ramon S. Ang said the cement company was facing a “very good future.” In two to three years, the company hopes to boost its market share to 25 percent from 14 percent at present, making it the largest cement company in the country.

But by next year, the older Ang said Eagle should already be number one in terms of capacity. “If we’re able to sell seven million [tons], Eagle will be number one right away,” he said.

He estimated Eagle’s sales volume could expand by around 25 percent next year.

In his remarks prior to the listing, PSE chair Jose Pardo said: “Filipino businesses can derive inspiration from Eagle Cement’s story. I believe there are local corporations that are ready to expand operations or offer more products to the market. This market debut shows that tapping the stock market is a viable financing option for growth and expansion. We have seen family businesses open their doors to the public through the years.”

Online stock brokerage COL Financial also sees bright prospects for Eagle, saying it was “poised to benefit from the Philippines’ growing construction industry due to the country’s GDP (gross domestic product) growth and the government’s plan to boost infrastructure spending.”

At present, Eagle is the fourth largest cement producer in the country in terms of capacity. The three bigger players are all multinational firms.

The local firm has a production capacity of 5.1 million tons a year, or a total of 130 million 40-kilo bags of cement. It is already completing its third production line in Bulacan, which will raise production capacity to 7.1 million metric tons per annum by 2018.

IPO proceeds will be used to partially finance the construction of a two-million metric ton cement plant in Cebu, which will become its fourth production line. This plant is set to raise production capacity to 9.1 million metric tons per annum by 2020.

“And whenever there’s an opportunity to invest, to acquire anything whether mining rights or existing plant or whatsoever, the company will definitely pursue it,” the older Ang said, adding that acquisition would hasten the company’s growth.

Eagle sold 500 million primary common shares with an over-allotment option of up to 75 million secondary shares. Its ticker symbol is “EAGLE”.

 

 

 

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Sy companies lead Forbes list of largest PH public firms

By: Daxim L. Lucas - Reporter / @daxinqPhilippine Daily Inquirer

Eight of the country’s largest corporations—the holding firms of Philippine conglomerates and some of their large operating units—were named among the world’s biggest public companies in a list published by US-based business magazine Forbes.

Together, these Filipino corporate giants on the list had a combined market value of $72.4 billion or P3.6 trillion at current exchange rates.

Their combined sales hit a total of $40.6 billion, or P2 trillion, accounting for roughly 14 percent of the country’s $300-billion economy.

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In terms of asset concentration, these eight firms held $176.6 billion worth of assets, equivalent to P8.8 trillion pesos.

The Forbes list was led by SM Investments Corp. of the Sy family at the 823rd spot on the 2,000-company roster. The family’s patriarch, Henry Sy Sr., is also listed by the influential magazine as the country’s richest man.

SMIC booked $7.3 billion in sales last year, $650 million in profits, $17.3 billion in assets, and $17.8 billion in market value.

Not surprisingly, the second largest publicly listed Filipino firm is another Sy firm, BDO Unibank, coming in at the 1,018th spot.

This was followed by JG Summit Holdings Inc., the flagship company of the Gokongwei family, at the 1,151st spot.

“Forbes’ 2017 Global 2000 list faces much pressure amid unsteady geopolitical climates and slowing economies,” Forbes Media’s deputy editor for investing Halah Touryalai said in a statement. “Yet, in aggregate, these 2,000 companies have managed to come out stronger than last year, with increased sales, profits, assets and market values.”
“Despite slowing GDP figures, China and the US, whose companies make up more than 40 percent of the list, continue to dominate the top 10 list with financial giants,” he added. “This list illustrates that in spite of headwinds, the world’s dominant companies remain a steady force in an unpredictable and challenging environment.”

Taking fourth place among Filipino corporate giants was Ayala Corp., controlled by the Zobel family, with a global rank of 1,176.

This was followed by Top Frontier Investment Holdings of Ramon Ang at the 1,228th spot. The holding firm has interests in the energy sector and also holds the businessman’s stake in conglomerate San Miguel Corp.

Rounding out the list of the largest Philippine listed firms were Metropolitan Bank and Trust Co. of taipan George Ty (1,531st globally); Aboitiz Equity Ventures of the Aboitiz family (1,793rd), and Manila Electric Co., the country’s largest electricity distributor, controlled by the Metro Pacific group of Manuel Pangilinan (1,947th).

The ranking is based on a mix of four metrics: sales, profits, assets and market value.

Forbes’ list revealed that China’s banking giants hold steady at the top of the 2017 Global 2000 list. Industrial & Commercial Bank of China has been No. 1 for the fifth consecutive year. China Construction Bank remains No. 2. The other two of China’s “Big Four” banks – Agricultural Bank of China and Bank of China – dropped down on the list, but remained in the top 10. Berkshire Hathaway, the largest company in the United States, moves one spot up to No. 3. Others in the top 10 are JPMorgan Chase (No. 4), Wells Fargo (No. 5), Agricultural Bank of China (No. 6), Bank of America (No. 7), Bank of China (No. 8), Apple (No. 9) and Toyota Motor (No. 10).

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Martial law in Mindanao deemed overkill by bank, welcomed by BSP

MANILA — The declaration of martial law in Mindanao was deemed to be an “overkill” by ING Bank Manila, although Bangko Sentral ng Pilipinas Governor Amando M. Tetangco Jr. said Wednesday that government moves to suppress terrorist activities in the war-torn island would improve investor sentiment moving forward.

In a note to clients, ING Bank Manila senior economist Joey Cuyegkeng said a declaration of a state of emergency would have been “more appropriate” as the declaration of martial law “implies that the government has lost control of the situation in Mindanao when in fact the incident is isolated.”

“But the President has threatened in the past weeks to impose martial law as a result of movements of terrorist groups as well as military activities of the military arm of the communist party. His intentions are likely to give him more leeway to address the overall peace and order situation in the island including activities of not only extremist groups but likely also to address activity of the armed wings of the communist party,” Cuyegkeng said.

In terms of impact on the domestic financial markets, Cuyegkeng said it would likely be “limited,” adding that “calm likely to return after the initial reaction.”

“The problem is that markets are also affected by the surprise Moody’s credit rating downgrade of China by one notch this morning,” Cuyegkeng said, as the debt watcher warned that “China’s financial strength will erode somewhat over the coming years, with economy-wide debt continuing to rise as potential growth slows,” reports said.

But for Tetangco, the declaration of martial law covering the entire Mindanao was “a very decisive move in the part of the government,” as he noted that its main objective was to “improve the security and peace and order situation, which should lead to even greater confidence down the road.”

“There may be some transitory or temporary cautiousness, but in the end I think it will lead to a positive impact on sentiment,” Tetangco told reporters on the sidelines of the special testimonial luncheon in his honor that was hosted by seven local and foreign business groups.

Tetangco said the BSP has been monitoring the situation of bank offices and branches in Mindanao, “and the reports were it’s business as usual so far.”  SFM

 

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