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THURSDAY, 04 DECEMBER 2014
STOCKS IN FOCUS:
ALI: Consolidates control of Trinoma
ALI offers to buy 15.79% stake in Trinoma. Ayala Land has offered to buy the 15.79% interest in
Trinoma that is held by Anglo Philippine Holdings for Php1.26 Bil. This would increase ALI’s stake
in Trinoma from 49.29% to 65.08%. This would then allow ALI to consolidate earnings of Trinoma
into its books going forward.
Accretive to ALI NAV. The implied valuation of Trinoma based ALI’s offer of Php1.26 Bil for 15.79%
stake is Php8 Bil. Based on our estimates using an EBITDA cap-rate method, we value Trinoma
at around Php20 Bil. Therefore the acquisition by ALI is value accretive. Based on our estimates,
the transaction will increase our FV estimate by Php0.20 per share. In addition, consolidation of
Trinoma will improve transparency of the mall’s operations.
(As ofDecember 03, 2014)
INDICES
INDICES
PSEi
All Shares
Financials
Holding Firms
Industrial
Mining & Oil
Property
Services
Dow Jones
S&P 500
Nasdaq
17,776.8
2,053.4
4,727.3
-51.4
-14.1
-64.3
-0.29
-0.68
-1.34
YTD%
24.97
19.38
19.97
18.78
38.28
32.88
30.39
16.27
7.24
11.10
13.19
INDEX GAINERS
OTHER NEWS:
PGI: Profriends secures SEC approval for IPO
PGOLD: Sets 2015 capex at Php5Bil
Economy: Floor price for CALAX PPP set at Php20.1Bil
Close Points
%
7,360.75 16.52 0.22
4,314.87
-1.72 -0.04
1,713.11
0.14 0.01
6,449.23 25.24 0.39
12,017.06 38.87 0.32
15,836.21 -11.26 -0.07
2,875.60
-1.62 -0.06
2,169.68
-0.89 -0.04
INDEX GAINERS
Ticker
MPI
EMP
LTG
MER
SMC
Company
Metro Pacific Inv Corp
Emperador Inc
LT Group Inc
Manila Electric Co
San Miguel Corp
Price
4.90
10.64
13.18
260.00
77.50
%
-2.58
-2.03
-1.35
-0.69
-0.64
MARKET SUMMARY:
INDEX LOSERS
The PSEi continued to rise on Wednesday on selective buying of large-cap stocks. The index
advanced 16.52 points or 0.22% to close at 7,360.75.
Index decliners led gainers 14 to 13 while 3 issues remained unchanged. Sector performance
was mixed with Holding Firms (+0.39%) and Industrial (+0.32%) making gains while all other
sectors were flat last trading session. Significant decliners were MPI (-2.58%), EMP (-2.03%),
LTG (-1.35%), MER (-0.69%), and SMC (-0.64%). On the other hand, the index was lifted by gains
made by AC (+1.45%), GTCAP (+1.40%), AGI (+1.39%), and URC (+1.22%).
Value turnover decreased to Php8.5Bil from Php8.9Bil the previous session. Foreigners were net
sellers, liquidating Php92Mil worth of shares.
INDEX LOSERS
Ticker
MPI
EMP
LTG
MER
SMC
Company
Metro Pacific Inv Corp
Emperador Inc
LT Group Inc
Manila Electric Co
San Miguel Corp
Price
4.90
10.64
13.18
260.00
77.50
%
-2.58
-2.03
-1.35
-0.69
-0.64
TOP 5 MOST ACTIVE STOCKS
TOP 5 MOST ACTIVE STOCKS
Ticker
SMPH
TEL
BDO
URC
GTCAP
Company
SM Prime Hldgs Inc
Phil Long Distance Co
BDO Unibank Inc
Universal Robina Corp
GT Capital Hldgs Inc
Turnover
397,570,800
366,473,900
312,453,200
310,741,000
309,517,900
PHILIPPINE EQUITY RESEARCH
STOCKS IN FOCUS:
ALI: Consolidates control of Trinoma
ALI offers to buy 15.79% stake in Trinoma. Ayala Land has offered to buy the 15.79% interest in
Trinoma that is held by Anglo Philippine Holdings for Php1.26 Bil. This would increase ALI’s stake in
Trinoma from 49.29% to 65.08%. This would then allow ALI to consolidate earnings of Trinoma into
its books going forward.
Accretive to ALI NAV. The implied valuation of Trinoma based ALI’s offer of Php1.26 Bil for 15.79%
stake is Php8 Bil. Based on our estimates using an EBITDA cap-rate method, we value Trinoma at
around Php20 Bil. Therefore the acquisition by ALI is value accretive. Based on our estimates, the
transaction will increase our FV estimate by Php0.20 per share. In addition, consolidation of Trinoma
will improve transparency of the mall’s operations.
Richard Lañeda, CFA
Ticker: ALI
Rating: BUY
Target Price: Php37.50
OTHER NEWS:
PGI: Profriends secures SEC approval for IPO
Profriends Group, Inc. (PGI) has secured approval from the SEC for its Php7.7Bil IPO. The company
plans to 385.75Mil shares at an offer price of up to Php20/sh. Of the total proceeds from the offer, PGI
plans to use Php3Bil for development and construction, Php2Bil for in-house financing requirements,
Php600Mil for general corporate purposes, and the balance to expand on its 1,800 hectares of
landbank. The IPO remains subject to the approval of the PSE. The final offer price will be set on
December 15 with the offer running from December 17 to January 9. Target listing date for PGI is on
January 15. (source: BusinessWorld)
Jed Frederick Pilarca
Garie Ouano
Meredith Hazel Cua
PGOLD: Sets 2015 capex at Php5Bil
PGOLD has allocated Php5Bil to fund capital expenditures in 2015, higher than its Php3Bil spending
plan for this year. The company’s spending plan includes Php2Bil for 25 new Puregold stores
comprised of 10 stores in the Visayas-Mindanao area, 10 stores in Luzon excluding Metro Manila,
and five in Metro Manila. PGOLD is also spending Php1Bil for two new S&R branches in the Visayas
and in Metro Manila next year. Finally, the company has set aside Php1.5Bil for possible acquisitions.
(source: BusinessWorld)
Economy: Floor price for CALAX PPP set at Php20.1Bil
The government has set a minimum floor price of the Cavite-Laguna Expressway (CALAX) PPP
at Php20.1Bil, equivalent to the original bid by San Miguel’s Optimal Infrastructure. The floor price
represents a premium which bidders must be willing to pay on top of the estimated Php35.4Bil project
cost. Recall that the project is being rebid following Optimal Infrastructure’s disqualification and the
subsequent intervention by Malacañang. According to the DPWH, the new auction process will be
faster since both the technical bids and financial bids will now be opened simultaneously.
(source: BusinessWorld)
THURSDAY, 04 DECEMBER 2014
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PHILIPPINE EQUITY RESEARCH
Calendar of Key Events
NOVEMBER
MON
TUES
WED
THURS
FRI
SAT
27
28
29
30
31
1
3
4
REG: Ex-date Php0.25
Cash Dividend
5
6
10
11
FPI: Annual
Shareholders Meeting
12
17
18
WEB: Ex-date Php0.10
Cash Dividend
FPH: Ex-date Php1.00
Cash Dividend
SUN: Annual
Shareholders Meeting
25
19
NIKL: Ex-date Php0.50
Cash Dividend
ARA: Annual
Shareholders Meeting
24
THURSDAY, 04 DECEMBER 2014
26
EEI: Ex-date Php0.05
Cash Dividend
7
PX: Ex-date Php0.03
Cash Dividend
APO: Ex-date Php0.015
Cash Dividend
OV: Ex-date Php0.0005
Cash Dividend
CNPF: Annual
Shareholders Meeting
13
14
HOUSE: Ex-date
PF: Ex-date Php1.20
Php0.05 Cash Dividend
Cash Dividend
ATN: Annual
MARC: Annual
Shareholders Meeting
Shareholders Meeting
ZHI: Annual Shareholders
Meeting
20
21
SLF: Ex-date Php0.36
Cash Dividend
RLT: Annual
Shareholders Meeting
27
MPI: Ex-date Php0.04
Cash Dividend
SFI: Annual
Shareholders Meeting
28
AR: Annual Shareholders
Meeting
MG: Annual
Shareholders Meeting
TUGS: Annual
Shareholders Meeting
8
15
22
29
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PHILIPPINE EQUITY RESEARCH
Investment Rating Definitions
BUY
HOLD
SELL
Stocks that have a BUY rating have attractive
fundamentals and valuations, based on
our analysis. We expect the share price
to outperform the market in the next six to
twelve months.
Stocks that have a HOLD rating have either
1.) attractive fundamentals but expensive
valuations; 2.) attractive valuations but
near term earnings outlook might be poor
or vulnerable to numerous risks. Given the
said factors, the share price of the stock may
perform merely inline or underperform the
market in the next six to twelve months.
We dislike both the valuations and
fundamentals of stocks with a SELL rating.
We expect the share price to underperform in
the next six to twelve months.
Important Disclaimers
Securities recommended, offered or sold by COL Financial Group, Inc.are subject to investment risks, including the possible loss of the principal amount
invested. Although information has been obtained from and is based upon sources we believe to be reliable, we do not guarantee its accuracy and it may
be incomplete or condensed. All opinions and estimates constitute the judgment of COL’s Equity Research Department as of the date of the report and are
subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of a
security. COL Financial ans/or its employees not involved in the preparation of this report may have investments in securities or derivatives of securities of
securities of the companies mentioned in this report, and may trade them in ways different from those discussed in this report.
2401-B East Tower, Philippine Stock Exchange Centre, Exchange Road, Ortigas Center, Pasig City 1605 Philippines
Tel: +632 636-5411
THURSDAY, 04 DECEMBER 2014
Fax: +632 635-4632
Website: http://www.colfinancial.com
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