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LOCAL MARKET FLOWS
BANCOLOMBIA ANALYSIS: COLOMBIAN EQUITY RESEARCH – Market Report
Flows
I
May 11, 2015
Local Market Rebound Driven by Foreigners’
Massive Purchases
After Seven Consecutive Months in Negative Territory the
COLCAP Recovered in April
The balance for the local market in April was favorable. The COLCAP achieved an appreciation of
7% and broke the resistance of 1,400 points, a level not tested since early February. Also, this is
the best performance in the last 12 months. The rebound of the equity market was driven by the
appetite of international buyers, as shown before, which helped to increase April’s average trading
volume to COP194,937mn/USD83mn, higher than the average in April 2014 and 2013. After the
COLCAP was rebalanced that month, maintaining 20 companies but 24 shares, there were
important crosses between common and preferred shares of different companies. It is worth
mentioning that 12.5% of total operations were done at market on close (MOC) and 30.6% were
relevant transactions (COP1,000mn or more) made by institutional or professional investors. The
balance for the 24 COLCAP shares is noteworthy: only CLH exhibited falls (-1.5%), meanwhile
gains were led by Canacol (32.1%) and Pacific Rubiales (28.8%), with the recovery of oil prices as
main driver.
On May the market is expecting a large number of earnings reports, with local movements
explained by companies reporting under the IFRS for the first time. Let’s remember this
methodology does not generate fundamental valuation changes as cash flow remains the same
independent of the accounting method used; however, multiples and negotiation ratios could exhibit
significant changes. Likewise, the market will be aware of news regarding Chinese economic
development and the resolution of the Greece financial situation in the Eurozone. Besides, the oil
price will continue as a benchmark, given its importance for the Colombian economy.
APR 2015 Transactions (USDmn)
Buyers
Sellers
Net
Participation
Foreigners
Real Sector
Individuals
Brokerage Firms
Pension Funds
Local Mutual Funds
ADRs
Insurance Companies
Others
Total
562.3
309.9
195.8
187.1
146.9
43.6
84.5
6.8
25.7
1,562.4
450.3
369.4
227.4
186.8
191.6
54.5
5.3
52.7
24.4
1,562.4
112.0
-59.5
-31.7
0.3
-44.7
-10.9
79.2
-45.9
1.2
32.4%
21.7%
13.5%
12.0%
10.8%
3.1%
2.9%
1.9%
1.6%
100%
Source: BVC, Bancolombia
1
Volume
400
COLCAP
1800
350
1700
300
1600
250
1500
200
1400
150
Points
On the other hand, pension funds have returned to their selling behaviour shown in the past two
years, piling up USD45mn in net sales, overpassed by the real sector with USD60mn and insurance
companies with USD46mn. As we have stated in previous reports, we believe AFPs will be out of
the market as a measure of diversification and long-term strategy investment.
COLCAP Evolution Last 12 Months
US$ mn
As anticipated, there would not be a dramatic change in the situation of the local market unless
foreigners appease their selling behavior. Indeed, the rebound of the Colombian equity market was
accompanied by massive asset purchases by foreigners. Specifically, these agents made net
purchases for USD112mn and achieved a notable market share of 32%. In the same line, the ADR
program stood in second place in the top-buyers after acquiring USD79mn in net.
1300
100
1200
50
0
1100
Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15
Source: Bancolombia, BVC, Bloomberg
Most Traded Shares (USDmn)
Odinsa
185
Gruposura
170
Ecopetrol
160
Bancolombia PF
133
Bancolombia
123
Grupo Sura PF
111
Grupo Aval PF
CLH
99
67
Cemargos
55
Grupo Argos
55
Source: Bancolombia, BVC
Analysts
Name:
Phone:
E-mail:
Jairo Julián Agudelo Restrepo
(574) 6047048
[email protected]
Name:
Phone:
E-mail:
Kevin López Tafur
(571) 7464318 Ext 37376
[email protected]
Local Market Flows
May 11, 2015
Figure 1 – Market Participants Evolution
Foreigners
Brokerage firms
Pension Funds
Individuals
Real Sector
Others
10% 22%
100%
90%
80%
14% 11% 12%
70%
60%
50%
40%
30%
32%
20%
10%
0%
Apr-13
Aug-13
Dec-13
Apr-14
Aug-14
Dec-14
Apr-15
Source: BVC, Bancolombia
Figure 2 – Average Monthly Volume (USDmn)
2013
2014
2015
Volume
75
US$ mn
25
78
54
49
47
40
34
20
0
0
Apr-08 Apr-09 Apr-10 Apr-11 Apr-12 Apr-13 Apr-14 Apr-15
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: BVC, Bancolombia
Source: BVC, Bancolombia
Figure 4 – Market Winners and Losers
13.9%
16.6%
18.0%
18.6%
BOGOTA
GRUPOSURA
BVC
CEMARGOS
31.2%
13.5%
GRUPO ARGOS
ODINSA
12.3%
ELCONDOR
28.9%
12.0%
25%
PF GRUPO ARGOS
50%
PREC
75%
-1.5%
-1.2%
-1.1%
CEMEX
CONCONCRETO
CARVAJAL
MINEROS -5.5%
BMC -7.5%
0%
Source: BVC, Bancolombia, Bloomberg
1.
.
77
64
64
US$ mn
77
60
50
-25%
Average
80
77
78
100
Figure 3 – Average April Volume (USDmn)
2 2
Local Market Flows
May 11, 2015
Figure 5 – Foreigners’ Evolution (USDmn)
Figure 6 – Pension Funds’ Evolution (USDmn)
250
200
200
150
100
150
112
50
USD mn
USD mn
100
50
0
-50
0
-100
-50
-150
-100
Apr-11
Oct-11
Apr-12 Oct-12
Apr-13 Oct-13
Apr-14 Oct-14
Apr-15
Source: BVC, Bancolombia
-200
Apr-11
Oct-11
Apr-12
Oct-12 Apr-13
Oct-13 Apr-14
Oct-14 Apr-15
Source: BVC, Bancolombia
Figure 7 – Brokerage Firms’ Evolution (USDmn)
Figure 8 – Individuals’ Evolution (USDmn)
250
100
150
50
50
0
0.3
USDmn
USDmn
-45
-50
-32
-50
-150
-100
-250
-150
-200
-350
Apr-11
Oct-11
Apr-12
Oct-12
Apr-13
Oct-13
Apr-14
Oct-14
Apr-11 Oct-11 Apr-12 Oct-12 Apr-13 Oct-13 Apr-14 Oct-14 Apr-15
Apr-15
Source: BVC, Bancolombia
Source: BVC, Bancolombia
Figure 9 – Net Movements (USDmn)
Figure 10 – Average Annual Evolution (USDmn)
Foreigners
112
ADRs
79
2
Brokerage Firms
0
Individuals
-45
Insurance Companies
-46
Real Sector
2013
2014
2015
50
-32
Pension Funds
2012
100
US$ mn
Investment Groups
2011
150
2
0
-5
-35
-50
-77
-100
-60
-80
-40
0
40
US$ mn
80
-150
120
Pension Funds
Source: BVC, Bancolombia
Source: BVC, Bancolombia
3
Foreigners
Brokerage Firms
Individuals
Local Market Flows
May 11, 2015
Figure 11 – Foreigners’ Movements (USDmn)*
Figure 12 – Pension Funds’ Movements (USDmn)*
GRUPOSURA
PFGRUPSURA
108
BCOLOMBIA
PFCEMARGOS
40
CEMARGOS
26
CLH
27
PFGRUPOARG
32
21
PFBCOLOM
23
18
CLH
-28
CEMARGOS
-19
PFCEMARGOS
-28
BCOLOMBIA
-19
PFBCOLOM
-32
PFGRUPSURA
GRUPOSURA
-56
-29
ECOPETROL -46
-80
-40
0
40
80
120
-55
-40
-25
Million
-10
5
Million
Source: BVC, Bancolombia
Source: BVC, Bancolombia
Figure 13 – Brokerage Firms’ Movements(USDmn)*
Figure 14 – Individuals’ Movements (USDmn)*
ICOLCAP
BCOLOMBIA
6
BCOLOMBIA
2
PFGRUPSURA
1
ISAGEN
PREC
4
GRUPOARGOS
4
PFBCOLOM
-2
-6
CEMARGOS
GRUPOSURA
-2
ODINSA
PFBCOLOM
-2
GRUPOSURA
-5
8
PREC
-1
0
5
10
-8
-10
-15
-20
-10
Million
Source: BVC, Bancolombia
Source: BVC, Bancolombia
Figure 15 – AFP’s Equity Investment Limits per Fund (Feb. 15)**
AFP
Protección
Porvenir
Old Mutual
Colfondos
System
Fund type
Low Risk
Moderate
High Risk
Low Risk
Moderate
High Risk
Low Risk
Moderate
High Risk
Low Risk
Moderate
High Risk
Low Risk
Moderate
High Risk
Investments in equity securities
From national issuers
7.8%
21.1%
27.1%
6.2%
20.6%
23.3%
7.0%
22.5%
29.9%
7.6%
22.8%
28.4%
7.1%
21.8%
27.2%
From foreign issuers
12.1%
21.2%
41.9%
14.1%
24.0%
44.9%
12.4%
21.1%
38.3%
13.9%
24.3%
40.3%
13.1%
22.7%
41.3%
Total
National
Limit
19.9%
42.3%
69.0%
20.3%
44.6%
68.2%
19.4%
43.7%
68.3%
21.5%
47.1%
68.7%
20.3%
44.4%
68.5%
15%
35%
45%
15%
35%
45%
15%
35%
45%
15%
35%
45%
15%
35%
45%
Source: Superfinanciera, Bancolombia
*Values were calculated with the actual number of traded shares and the average trading price for the month
**February 2015, last period of public information released by Superfinanciera
4
35
16
PFGRUPSURA
3
CNEC
20
Maximum
Local Gap
Limit
20%
45%
70%
20%
45%
70%
20%
45%
70%
20%
45%
70%
20%
45%
70%
7.2%
13.9%
17.9%
8.8%
14.4%
21.7%
8.0%
12.5%
15.1%
7.4%
12.2%
16.6%
7.9%
13.2%
17.8%
0
Million
10
20
Local Market Flows
May 11, 2015
Equity Sales
Equity Research
Rupert Stebbings
Jairo Agudelo
Equity Markets Vice President
Head of equity research
[email protected]
[email protected]
+574 6045138
+574 6047048
Natalia Agudelo Parra
Juan Camilo Dauder Sánchez
Equity Sales
Head Energy Analyst
[email protected]
[email protected]
+574 6046498
+574 6049821
Equity Trading
Maria Paula Cortés Durán
Head Financial & Small Cap
Anthony Goeritz
[email protected]
Equity Trading
+571 353 6600 ext 15237
[email protected]
+574 6045340
Diego Buitrago
Energy Analyst
Fixed Income
[email protected]
+571 7463984 ext 37307
Pablo Caicedo
VP International Business
German Zuñiga
[email protected]
Infrastructure and Industry Analyst
+571 488 6000
[email protected]
+574 6047045
Economic Research
Federico Perez Garcia
Juan Pablo Espinosa
Oil & Gas Junior Analyst
Head of Economic Research
[email protected]
[email protected]
+574 6048172
+571 7463991 ext. 37313
Research Assistant
Alexander Riveros
Senior Economist
[email protected]
Claudia Restrepo
+571 7463980 ext 37303
Research Editor
[email protected]
+574 404 3809
5
Local Market Flows
May 11, 2015
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