PH gambling business seen surpassing Singapore’s $5.6B market by 2018

MANILA, Philippines—The Philippines’ burgeoning gaming industry may surpass Singapore’s $5.6-billion gaming market by 2018 on the back of a larger local mass market and likely spillover of foreign high-rollers, foreign bank Credit Suisse said.

In a new equity research dated February 27, “Let the Games Begin,” Credit Suisse initiated coverage of the Philippine gaming sector with a rosy outlook of 28 percent compounded annual growth rate for the industry over the 2012 to 2018 period.

“We view the Philippines as having a potentially larger domestic market in the high-margin mass segment compared to other Asian gaming hubs on the back of favorable demographics,” the report said, noting that the Philippine population of 97 million was almost three times that of Singapore, Malaysia and Macau combined.

It pointed out that the Philippines also had the fastest growing working age population in emerging Asia, projected to grow more than two percent annually over the next 10 years. Accelerating wage growth, signs of increased spending power and consumer confidence at near-record highs all point to favorable demand prospects, the report said.

Meanwhile, Credit Suisse also noted that limited hotel capacity and the absence of new casinos elsewhere in the region until 2015 could result in a spillover of foreign VIPs (very important persons) into the Philippines.

The bank initiated coverage of two listed gaming stocks Bloomberry Resorts Corp. and Belle Corp. with “outperform” ratings and respective target prices of P17.50 and P6.50, respectively.

via Inquirer.net

PSE among best stock markets in 2012

MANILA, Philippines - The Philippine Stock Exchange ranked third globally among top performing bourses last year in terms of domestic market capitalization, PSE reported on Tuesday.

Citing a report from the World Federation of Exchanges, the local bourse said that it was only outpaced by the stock exchanges in Turkey and Thailand after posting a 38.9 percent expansion in 2012. WFE is composed of 50 bourses all over the world.

“Ranking among the top markets around the world is a feat which I think all Filipinos can be proud of as we are pitted against the best of the best markets in these global rankings. This is a testament to what we have been saying that the Philippines is now indeed in the global radar for investments and these numbers prove our worth as a viable investment destination,” PSE President and Chief Executive Officer Hans Sicat said.

The report likewise noted that the PSE ranked third after the Saudi Stock Exchange and the Bermuda Stock Exchange after posting a 25.3-percent growth in the value trading turnover. It also placed fourth in terms of trades growth and fifth in terms of broad market index growth.

In 2011, PSE also ranked first in the growth of its broad market index, third in domestic market capitalization and fourth in trading turnover among 51 stock exchanges. PSE added that among the top performing stock markets in 2011, it was the only one which figured in the best performing markets list by posting growth across all growth metrics.

“For two consecutive years, our stock market has been recognized among the fastest growing markets. This just shows that our growth has been sustainable particularly as it founded on the increased economic activity in the country. We are excited about the outlook in 2013 as we also undertake new programs and introduce new products in our stock market to keep the growth momentum in the coming years,” Sicat added.

via Philstar.com

Philippine stocks breach 6,500 for first time in history

MANILA, Philippines— The local stock index closed above 6,500 for the first time on Wednesday as cash-awashed investors chased yields and bet on the country’s good macroeconomic prospects.

The Philippine Stock Exchange index surged by 68.06 points or 1.05 percent to finish at 6.

“Everyone is in love with the Philippine market,” said Astro del Castillo, managing director at investment management firm First Grade Finance Inc.

“The PSEi almost seems impervious to market corrections.  The formidable macro backdrop, highlighted by the BSP (Bangko Sentral ng Pilipinas) in its economic briefing (Wednesday morning), is likely to keep valuations elevated longer than so far assumed,” said Mark Angeles, head of research at First Metro Securities.

Stock dealers said this continued to be a liquidity-driven rally as investors continued to gobble up stocks in a low-interest rate environment.  This is amid rosy prospects for corporate Philippines as well as the macroeconomic backdrop this 2013.

This run-up belatedly fulfilled President Benigno Aquino III’s wish that the PSEi hit 6,500 by his birthday (Feb. 8).

Firmer overseas markets also supported risk-taking at the local market even as many Asian investors were still on holiday due to the Lunar Year turnover break.

ALI (+4.58 percent) led the day’s upswing after beating consensus profit forecasts for 2012.  ALI grew 2012 net profit by 27 percent to a record high P9.0 Megaworld, BPI, URC, MPI, ICTSI, SMDC, Semirara, Metrobank and Petron also contributed significant gains to the PSEi.

On the other hand, the day’s laggers were RLC, AGI, Aboitiz Power and Belle. RLC announced a modest 3-percent increase in October to December net profit, the first quarter in its fiscal year ending September.

Value turnover amounted to P8.28 billion.  There were 112 advancers that overwhelmed 52 decliners while 50 stocks were unchanged.

Meanwhile, the PSE unveiled plans to enhance its online disclosure system used by listed companies to better serve investors.

In July 2005, the PSE provided 24/7 online system access to listed companies for the submission and announcement of company disclosures through an Online Disclosure System (ODiSy). The ODiSy manages three key areas: compliance by listed companies with disclosure rules, extended service accessibility on the Internet, and operational efficiency with the immediate processing of each disclosure submission.

The proposed enhancement envisions the adoption of best practices for listed company disclosure. Under the new system, pertinent information contained in financial reports and other required disclosures relating to material corporate actions and transactions, such as dividend declarations, notices of meetings, rights offerings and public float reports, will also be submitted in an electronic format that can be transmitted directly to analysts and data providers via their respective systems. At present, disclosures are all submitted in PDF format where information is extracted using separate procedures by different users.

“The PSE is at the forefront of improving its online disclosure infrastructure and services to our listed firms. The enhanced features of the online disclosure system will help hasten the distribution of information to the public and, in the long run, rationalize the regulatory requirements for listed companies,” PSE president Hans Sicat said.

via Inquirer.net

EU eyes new PHL business opportunities

The European Union is exploring business and investment opportunities in the Philippines, the EU Delegation to the Philippines said Monday.

 

This week, members of the European parliament led by Werner Langen, chairman of the Delegation of the European Parliament for Relations with the countries of Southeast Asia and ASEAN, are in the country to explore new investment opportunities in the fast growing Philippine economy.

 

The EU parliamentarians, who heads powerful economic committees, will meet with Bangko Sentral ng Pilipinas Governor Amando Tetangco, Trade Secretary Gregory Domingo, as well as CEOs and leaders of the European Chamber of Commerce and Industry.

 

This development “underscores EU support for President Aquino’s good governance and anti-corruption efforts that are making the country more attractive to European investment,” Ambassador Guy Ledoux, head of the EU Delegation to the Philippines, noted in a statement.

 

“The Members of the European Parliament are in the Philippines also to lend their political support to the peace process in Mindanao,” Ledoux added.

 

The EU delegation will visit Mindanao on February 13 to 14 and meet with officials of the Moro Islamic Liberation Front, Autonomous Region in Muslim Mindanao, International Monitoring Team, and members of non-government and civil society organizations. — VS, GMA News

Manila To Receive Patrol Boats from Japan

TOKYO – Japan plans to donate patrol boats costing $11 million each to the Philippines, ramping up regional efforts to monitor China’s maritime activity in disputed waters, a newspaper said Monday.

The Japanese government plans to finance the deal in its fiscal 2013 budget starting in April and hopes to officially sign it early next year, the Nikkei business daily reported.

Japan will then provide the Philippines with the newly built patrol vessels, which will cost more than one billion yen ($11 million) each, the newspaper said, without specifying the number of boats on offer.

Both countries are locked in separate territorial disputes with China.

Japan’s dispute is over a group of uninhabited islands in the East China Sea known as the Senkakus in Japan and the Diaoyus in China.

The Philippines is one of several Southeast Asian countries, including Vietnam, that are rowing with China over claims to parts of the South China Sea. Two of the hotspots are the Spratly islands and Scarborough Shoal.

The Japanese coastguard also plans to train Philippine and Vietnamese personnel as part of additional efforts to boost security cooperation with Southeast Asia, the Nikkei said.

In the fiscal 2013 budget draft, 2.5 billion yen has been allotted for such expenditure, it said.

Last month, Japanese Foreign Minister Fumio Kishida visited Manila and called for stronger ties with the Philippines to help ensure regional peace.

Japan’s coastguard last month said it would create a special unit comprising 10 new large patrol boats to boost its surveillance of the Senkaku/Diaoyu islands.

The long-running row over the islands intensified in September when Tokyo nationalised part of the chain, triggering fury in Beijing and huge anti-Japan demonstrations across China.

In the most serious high-seas incident yet, Japan last week said that a Chinese frigate locked its weapon-targeting radar on a Japanese navy vessel on January 30. China has angrily denied the charge.

via Inquirer.net, AFP

PH firms show high degree of optimism

Corporate Philippines is riding on a “sky-high” confidence level this year, topping business sentiment elsewhere in Southeast Asia on the back of good local economic prospects, British bank Standard Chartered said.

In a research note issued after conducting a regional road show, the oldest foreign bank in the Philippines said 74.5 percent of its top local clients expected their businesses to do better in 2013 than last year. Only 6.1 percent of local respondents thought that their businesses could do worse in 2013, based on a Feb. 5 research published by Stanchart titled “What Asean Corporates Think?”

Meanwhile, only 44 percent of top-tier clients in Singapore expected their businesses to do better this year while comparative levels were similarly much lower than that of the Philippines: in Kuala Lumpur (41 percent), Bangkok (44 percent) and Jakarta (46 percent).

“This is particularly bullish, considering the Philippines registered 6.6-percent growth in 2013, much higher than the 10-year average of 5.2 percent,” the research said.

“The degree of optimism was surprisingly strong. We have been highlighting the Philippines as an economic outperformer in Asia, but hearing the views on the ground, we were starting to look relatively bearish compared with local sentiment,” the research said.

Most clients expected the Philippine peso to appreciate relative to the US dollar in 2013, which the British bank said was in line with its overweight recommendation on the local currency. Overweight is a recommendation to load up on a particular asset or security in excess of a benchmark index.

The research said there were more mixed results when respondents were asked about the primary market of concern in 2013. A majority (54.5 percent) still saw Europe as the primary region of concern this year, while the United States received a sizable amount of attention as well (36.4 percent). The resurgence of China was of concern to only 9.1 percent of the respondents, while there were no respondents who were worried about the Philippine economy.

“We believe this reflects the Philippines’ relative insulation against external cycles, along with strong growth prospects that have alleviated domestic concerns,” the bank said.

Meanwhile, the report said certain clients felt that the biggest challenge to their businesses was to match last year’s revenue trend, with 43 percent concerned about sustaining business revenue growth. Other clients were concerned about managing foreign exchange and interest rate risks (26 percent) and regulatory/policy (22 percent). “We believe that this is attributable to the policy changes—such as on special deposit rates and taxation—in response to the capital inflows to the Philippines,” the research said.

By client category, Stanchart said financial institution clients were particularly more bullish on the peso and marginally less optimistic on the economy. Asked about their primary market of concern in 2013, financial institutions were more concerned about Europe while corporate clients were more concerned about the United States.

“We attribute this to the sources of volatility in these markets—Europe is more likely than the US to cause a financial contagion, while the US has more direct trade and overseas workers’ remittance links with the Philippines,” the research said.

Financial institutions were more concerned about managing foreign exchange and interest rate risks than corporate clients, who were focused on sustaining business revenue growth, the research said.

via  Doris C. Dumlao

Philippine Daily Inquirer

Asean execs bullish on Phl prospects

MANILA, Philippines - Business executives in the Association of Southeast Asian Nations (ASEAN) have expressed “sky-high confidence on the Philippine economy this year,” Standard Chartered Bank said in its latest survey.

“Although we do not have historical data to compare for the Philippines, confidence among our clients is extremely high,” the British bank said.

The bank study is the second leg of an annual survey on ASEAN corporates. The first part of the survey was done in Malaysia, Thailand and Indonesia.

It noted that majority of the respondents, composed of ASEAN corporates, are highly optimistic on the growth prospects of the Philippines this year compared to 2012.

“A significant net 77 percent of corporate respondents (optimists minus pessimists) see their businesses doing better in 2013 than in 2012,” it said. “Most of our clients in the Philippines are very optimistic about the economy, 74.5 percent of all our respondents expect their businesses to do better in 2013 than in 2012. Only 6.1 percent think that their businesses could do worse in 2013. This is particularly bullish, considering the Philippines registered 6.6-percent growth in 2013,” StanChart said.

“And, remarkably, none of the clients (i.e., of the 170 respondents) named the Philippines as their market of concern in 2013 (instead, they chose the US, Europe or China),” the study further noted.

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“We believe this reflects the Philippines’ relative insulation against external cycles, along with strong growth prospects that have alleviated domestic concerns,” it said.

The study also indicated that Philippine peso would remain stronger or flat against the US dollar by end 2013.

“Other clients are concerned about managing forex/interest rate risks (26 percent) and regulatory/policy (22 percent). We believe that this is attributable to the policy changes such as on special deposit rates and taxation-in response to the capital inflows to the Philippines,” it noted.

Meanwhile, the Philippine economy could grow six percent this year on the back of robust consumption spending buoyed by the election season and an expected roll-out of more infrastructure projects, original an investment bank said.

Singapore-based DBS Ltd. revised its forecast from 5.3 percent, becoming the latest firm to recognize Philippine economic gains following an above-target 6.6-percent expansion in 2012.

The latest outlook now falls at the low-end of the Aquino administration’s six to seven-percent target for the year. – With Prinz Magtulis

via Donnabelle L. Gatdula (The Philippine Star)

JP Morgan Chooses PHL's as One of the Favored Markets

Global investment bank JP Morgan has kept the Philippines among its favored stock markets this 2013 with a view that the main local index—despite the strong run-up in the past four years—could extend its winning streak by another 15 percent.

“We’ve been overweight on the Philippines since 2009 and we have no intention of changing that view,” JP Morgan’s chief for Asian and emerging market equity Adrian Moet said in a briefing Friday.

“From the perspective of the international equity investor, the Philippines is delivering low currency risk, high economic growth and high (corporate) earnings growth and that’s a very attractive proposition particularly against a still quite troubled world,” said Moet, who flew in from Singapore to speak in a forum organized by JP Morgan for large institutional investors keen on Philippine equities.

The forum this year, attended by around 70 institutional investors—mostly long-term investors who are new to the Philippines—is the biggest so far in the last seven years that JP Morgan has conducted such briefings to pitch local equities to the foreign market.

For 2013, the Philippines joins Mexico, Turkey, Thailand and India among the countries where JP Morgan has an “overweight” rating. “Overweight” is a recommendation to accumulate stocks in excess of a benchmark index, usually the closely-tracked MSCI index.

Moet said good macroeconomic stability, improving policies and prospects of demographic dividends—referring to a large pool of human resources reaching working age—were common to most of these markets (except Thailand).

On the other hand, JP Morgan has an “underweight” recommendation on Brazil, Taiwan and South Korea.  The investment firm has a “neutral” rating on China.

via Inquirer.net