Philippines Market Insights 2018.1.17
News Highlights: NTC deputy chief Edgard Cabarios said the 3rd telecom player might pay PLDT Inc. (TEL) over P3bn for the surrendered 3G frequency. NTC said the available frequency bands for the new player are 700MHz, 800MHz, 2100MHz, 2500MHz & 3400‐3500MHz. The second package of the Duterte administration’s Comprehensive Tax Reform Program was formally submitted to the House of Representatives by the Department of Finance (DoF) that aims to reduce corporate income tax rates to 25% from 30% currently and modernize fiscal incentives to investors.
Mart ends flat, PSEi @ 8,865: Mart flirted with the 8,900 mark throughout the day, reaching as high as 8,969 before ending relatively flat. Mining & Oil (+2.33%) led gains, followed by Industrial (+1.53%). Among actively traded shares were: JFC (+P13.80 at P277.60), ALI (+P0.25 at P45.05), BDO (-P2.00 at P161.00), SMPH (‐P0.05 at P39.30), and MBT (unch. at P107.00), on 7.41bn turnover. Gainers outperformed losers, 108‐102, with net foreign buying at P698.79mn.
Might trade higher: Mart might trade higher following anticipation for the second package of the Comprehensive Tax Reform Program which could cut corporate income tax rates and modernize fiscal incentives to investors. Immediate support 8,800, resistance 8,960.
Marts bounce back: Asian markets bounced back from initial softness in Tuesday trade, with Hong Kong’s Hang Seng index reaching records.
Shares pared gains: After breaching the 26,000 level, US equities pared gains in late afternoon trades as lower oil prices weighed on the energy sector.
Oil prices breaks 6‐session rise: Crude oil futures edged lower Tuesday for the first time in six sessions as a result of higher weekly rig count (+10 at 752) and as the dollar stabilized from 3‐year lows. West Texas Intermediate (WTI) slid $0.38 to $64.30/barrel.
NTC says 3rd telco player might pay TEL P3bn for surrendered 3G frequency:
NTC deputy chief Edgard Cabarios said the 3rd telecom player might pay PLDT Inc. (TEL) over P3bn for the surrendered 3G frequency. NTC said the available frequency bands for the new player are 700MHz, 800MHz, 2100MHz, 2500MHz & 3400-3500MHz. Cabarios also said potential candidates should invest at least P250bn‐P300bn over 5 years to compete with existing players.
MPI aims to close accord for a tollways venture in Malaysia:
Metro Pacific Investments Corporation (MPI) aims to close an accord for a tollways venture in Malaysia for 2018. The firm already has its stake in Indonesia infra firm PT Nusantara on top of holdings in Don Muang Tollways in Thailand & CII Bridgs & Roads in Vietnam.
CLI’s reservation sales in 2017 stood at P4.58bn, 13.8% above target:
Cebu Landmasters, Inc. (CLI)’s reservation sales for 2017 stood at P4.58bn, 13.8% higher than target, with the launch of new residential projects: 745 units in 38 Park Avenue (Cebu IT Park); 3,200 units in Casa Mira South (Cebu); 1,514 units in Mivesa Garden Residences (Cebu); 695 units in MesaTierra (Davao City), among others. CLI is aiming for P7bn reservation sales for 2018(+52%).
PNX board approves JV with TIPCO Asphalt Public Co. Ltd. & PhilAsphalt (Dev’t.) Corp. for Bitumen:
Phoenix Petroleum Philippines, Inc. (PNX)’s board approved the joint venture agreement (JVA) with TIPCO Asphalt Public Co. Ltd. & Carlito B. Castillo for PhilAsphalt (Dev’t.) Corp. for the operation, marketing & distribution of bitumen & bitumen‐related products in the Philippines. PNX will own 40% of the joint venture (JV) firm. Upon the incorporation of the JV firm, a lease transaction is expected from Calaca Industrial & Seaport (formerly Phoenix Petroterminals & Industrial Park) with access to its jetty & wharf facilities. The JV firm shall have an authorised capital of P275mn.
House of Representatives receive DoF proposal of cutting corporate income tax:
The second package of the Duterte administration’s Comprehensive Tax Reform Program was formally submitted to the House of Representatives by the Department of Finance (DoF) that aims to reduce corporate income tax rates to 25% from 30% currently and modernize fiscal incentives to investors.
BSP to possibly lower reserves to release more liquidity:
The Central Bank may lower its reserves (currently at 20% level) to counter recent tightening in liquidity, according to BSP Governor Espenilla. While this has been planned as early as last year to aid the P9tn infrastructure program, the BSP may release it soon depending on further assessment of central bank planners.
Pepsi (PIP), Coca‐Cola and RC Cola to reformulate soft drink mix on new taxes:
After Pepsi Cola Products Philippines Inc. (PIP) earlier announced it was shifting to using 100% sugar in its products from the previous mix of 60% sugar and 40% HFCS, Coca-Cola Femsa Philippines Inc. and RC Cola Philippines have followed suit, as per the Sugar Regulatory Administration (SRA) board.