News Highlights: Metro Pacific Investments Corporation (MPI) will spend P10bn this year, mostly for its Cavite-Laguna Expressway (Calax) & C5 South Link projects. MGen of Manila Electric Company (MER) is holding talks with Irish firm ESB Int’l for a 10-year operations & management (O&M) agreement for Atimonan One Energy (A1E). Meanwhile, The Finance bureau has set 15 Jan. as submission date for package 2 of the tax reform program (CTRP). DoF wants corporate income tax rate lowered to 25% from 30%. December’s inflation was 3.3%, bringing 2017’s full year average to 3.2% (from 2016’s 3.17%).
Mart continues to soar, PSEi @ 8,770: Mart continued to soar to record-‐highs throughout the day, flirting around the 8,800 level intra-day before closing 30pts below the mark. Bullishness on the economy's growth continues to bolster investors' risk appetite. Industrial (+1.37%) and Property (+1.04%) sectors led gains. Among actively traded shares were: SECB (-P3.80 at P246.00), SM (‐P30.00 at P1,020.00), BDO (unch. at P160.00), URC (+P7.90 at P163.90), and AC (+P25.00 at P1,065.00), on 10.57bn turnover. Gainers outperformed losers, 126‐87, with net foreign buying at P892.18mn.
Optimism on next tax reform package: Mart might trade higher as investors cheer ahead the submission of the next tax reform package which might propose to reduce the corporate income tax rate from 30% to 25% within the year, in addition to the expected steady inflation within 2%-4% target. Immediate support 8,700, resistance 8,850.
Shares higher: South Korea stock market bounced higher again on Friday, one session after it had ended the four-day winning streak. Meanwhile, Asian markets were positive, despite weaker than expected jobs data from the U.S. and a drop in crude oil prices.
Shares continue to rally: Wall Street continued to rally Friday, as lower‐than‐expected rise in jobs data might prompt the Fed to stick to its gradual interest rate hike in 2018.
Oil settles lower: Oil futures settled lower on Friday, losing a grip on the highest levels in three years, but prices still scored a third weekly gain a row on the back of a seventh-straight drop in U.S. crude supplies and ongoing concerns over unrest in Iran. West Texas Intermediate (WTI) dipped $0.57 to $61.44/barrel.
MER’s MGen in talks with Irish firm for A1E:
MGen of Manila Electric Company (MER) is holding talks with Irish firm ESB Int’l for a 10‐year operations & management (O&M) agreement for Atimonan One Energy (A1E). MGen is evaluating bids from 3 suppliers for engineering, procurement & construction (EPC). Project completion is slated late 2021.
MPI to spend P10bn capex this year:
Metro Pacific Investments Corporation (MPI) will spend P10bn this year, mostly for its Cavite-Laguna Expressway (Calax) & C5 South Link projects. Calax is set to open in 2020 or early 2021. The firm is also waiting for the grant of original proponent status from the DPWH for the Cavite-‐Tagaytay-Batangas Expressway.
PSE to raise P3.16bn thru rights offer:
The Philippine Stock Exchange, Inc. (PSE) intends to raise P3.16bn through a rights offer of 11.5mn shares at P275/share. Proceeds will settle debt & finance capex. Offer run will be 5-9 Feb., listing on 23 Feb.
FGEN confirms submitting proposal to PNOC on shore storage & regasification:
First Gen Corporation (FGEN) confirmed submitting a proposal to PNOC to participate in FGEN’s onshore storage & regasification terminal within the First Gen Energy Complex in Batangas City. The terminal will have 5mn tons per annum (mtpa) capacity. FGEN started development work for the LNG terminal as early as 2012 & is positioned to be ready for operations prior to the termination of the Gas Sale & Purchase Agreements.
DTI’s P3 partners with TEL for MSME financing:
DTI’s P3 (Pondo sa Pagbabago at Pag-‐asenso) partnered with PLDT Inc. (TEL) for the latter’s digital lending platform, ‘Lendr’, to make financing accessible to micro SMEs. Lendr is a product of FINTQ, the financial technology arm of TEL & Smart’s Voyager Innovations. The solution allows mobile users to select a loan product, fill up an application form, submit their requirements & get approval notification via mobile.
GLO maintains capex at $850mn:
Globe Telecom, Inc. (GLO)’s board approved $850mn capex for 2018, consistent with 2017’s figure. Capex-‐ to-‐revenue for 2017 was at 34%. A good portion of the capex will be used to deploy massive MIMO technology to expand & enhance GLO’s LTE network.
GLO says P300+ prepaid load to carry one-year expiration:
GLO said prepaid load with P300 denomination & up will carry one-year expiration from the present 120 days. Meanwhile, prepaid load of P1 to below P300 expires 3-75 days. GLO still needs to address expansion capacity, system tests & new number series.
ICT’s board approves issuance of new perpetual notes by Royal Capital BV:
International Container Terminal Services, Inc. (ICT)’s board approved the issuance by Royal Capital BV of new senior perpetual notes guaranteed by ICT. Terms of the float will be announced later.
PNX gets approval from PCC on purchase of FamilyMart:
Phoenix Petroleum Philippines, Inc. (PNX) obtained a decision from the Phil. Competition Commission (PCC) approving the purchase of 100% of Phil. FamilyMart CVS from SIAL CVS Retailers, FamilyMart Co. Ltd. & Itochu Corp. PNX is also evaluating the viability of gas stations where it would put up FamilyMart units. PNX had 523 service stations as of Sept. 2017.
Lush Group to do IPO in 1H18:
Lester Yu’s Lush Group plans to do an IPO in 1H18 to finance its expansion plan. The firm offers fresh fruit juices & shares under Fruitas brand. Details will be announced soon.
DOF sets 15‐Jan as submission for package 2 of CTRP:
The Finance bureau has set 15 Jan. as submission date for package 2 of the tax reform program (CTRP). DoF wants corporate income tax rate lowered to 25% from 30%.
Dec inflation at 3.3%, full-year average at 3.2%:
December’s inflation was 3.3, bringing 2017’s full year average to 3.2% (from 2016’s 3.17%). Economic Planning chief Pernia said the results would allow government to maintain its inflation target of 2%-4% for the year.
DOF hires experts from Dev’t Academy of the Phil. for MICC:
The Department of Finance (DOF) hired experts from the Dev’t. Academy of the Phils. to form part of the 5 technical review team formed by the Interagency Mining Industry Coordinating Council (MICC) to review 26 mining operations that were ordered closed or suspended by DENR during Lopez’s term. The review will take place this week.