Trader's Logbook

Stocks lose traction with peak still in sight

U.S. stocks turned in an uninspired day of trading Wednesday as investors weighed slowing retail sales with slightly upbeat earnings reports. The Dow is about 1% away from its record high set in October 2007. The S&P 500 has also had a solid run, coming within 4% of its record high, also set around the same time.

http://money.cnn.com/2013/02/13/investing/stocks-markets/index.html?iid=mkt_SF_news

Local / News

ALI grew its net profit last year by 27% to a record-high P9.04 billion, exceeding market expectations of P8.7 billion, as all business segments sustained growth and enhanced operating margins. ALI spent a record high of over P71 billion for project and capital expenditures in 2012, 138% jump year-on-year; bulk of which went to land acquisition including the FTI property. For 2013, the company has earmarked P65.5 billion to complete ongoing developments and launch 69 new projects with combined value of P129 billion. This year, ALI will launch around 31,000 units across all residential brands.

http://business.inquirer.net/107447/ali-nets-record-high-p9-04b-in-2012-up-27

(AP) AEV CEO Erramon Aboitiz said Mindanao could be the country’s next business frontier if only infrastructure, especially power, were available. Because of lower interest rates, the group is in the position to invest long-term. AEV is investing P35 billion in the next three years to address acute power situation in Mindanao.

http://www.interaksyon.com/business/54956/mindanao-could-be-next-business-frontier-if—

AEV plans to spend around P85 billion for the building of new power plants across the Philippines in the next four years. The investment will be used for its equity share in 600MW coal fired power plant of Redondo Peninsula Energy, Inc. (owns 25% of RP Energy, expected to be on the grid by 2016); expansion of the 700MW coal-fired power plant in Pagbilao, Quezon (by another 400MW by 2016); the 300MW coal-fired power plant of its subsidiary in Davao is expected to start commercial operations by 2015; and 4 new hydropower projects with a combined capacity of 100MW.

Notes:

The National Grid Corporation of the Philippines yesterday estimated Mindanao’s shortage at 253MW, with peak demand of 1,168 MW outstripping a 915MW capacity.

The P85 billion will finance through a combination of equity and loans, “What we do in our projects is we get some project financing from banks – normally, about 70% – and then the balance is the equity that we put in as Aboitiz Power.”

http://www.bworldonline.com/content.php?section=Corporate&title=Aboitiz-Power-to-spend-P85B-in-next-four-years&id=65828

BRN has set up a new subsidiary, Peakpower Energy Inc., that will house its investments in the power sector. BRN is primarily engaged in the business of real estate development but has interests in power, property development, among other investments. The company’s subsidiary, Palm Thermal Consolidated Holdings Corp, is putting up a 270MW coal plant in Concepcion, Iloilo, in partnership with AC Energy Holdings Corp of the Ayala Group and Jin Navitas Resource Inc.; targeted for completion in Q4 2015.

http://www.interaksyon.com/business/54995/a-brown-forms-new-subsidiary-for-power-sector-investments

GMA7 earmarks more than P600 million this year on new facilities and satellite stations particularly for the acquisition of new equipment/facilities, opening of new originating stations, etc. The figure forms part of the P1-billion capex this year. There is a carry-over of P338 million from last year. Hence, the total to be spent this year is P978 million.

The company said it expected to earn P3 billion in net income for this year, almost double the P1.7 billion it estimates to have booked last year vs. initial estimates of P2.3 billion in November and P2.8 billion in March.

http://www.bworldonline.com/content.php?section=Corporate&title=GMA-earmarks-P640-million-for-more-facilities&id=65826

MPI, JGS have agreed in principle to form a consortium that will bid for the P17.5 billion Mactan Cebu International Airport (MCIA) Passenger Terminal Project. MVP said that MPI would lead the consortium because the company does not have any interest in the airline business. Other cos. that had purchased bid documents for the project were SMC, Aboitiz Land Inc. (AEV), FDC, MAC.

Notes:

DOTC moved pre-qualification conference for the project to February 13 from the initial schedule of January 28 and submission and opening of the qualification documents was pushed back to February 27 from the 18th of the same month.

http://www.interaksyon.com/business/54985/metro-pacific-jg-summit-team-up-for-mactan-airport-bid

PSE hopes to woo Japanese investors into participating more in the robust local stock market by holding a roadshow in Tokyo this week. The companies participating in this roadshow are: AEV, AGI, FLI, JFC, PGOLD, RLC, SMC, SM, URC, VLL and the PSE. The delegates from the corporate Philippines will meet with 21 of the top asset management companies and their respective senior fund managers and decision makers in Japan.

http://business.inquirer.net/107451/pse-hopes-to-lure-japanese-investors-with-tokyo-roadshow

Local / Sector

Banking

Total outstanding loans of universal and commercial banks, excluding placements with the BSP, stood at P3.24 trillion last December, up 16.2% from the previous year. Including credit under the BSP lending facility, outstanding loans grew 15.4% to P3.5 trillion. The pick-up in bank loans was accompanied by similar increase in domestic liquidity, M3 went up by a tenth year-on-year in December to P5.2 trillion. The pick-up in liquidity was propped up by a 19.2% increase in net domestic assets, which includes local loans and securities.

http://www.interaksyon.com/business/54989/bank-lending-money-supply-growth-picks-up

Tourism

The Aquino administration has increased its tourism target to 44 million arrivals by the end of its term in 2016, after 37 million visited the Philippines last year.

http://www.interaksyon.com/business/54962/dot-says-airport-congestion-a-boon-hikes-tourism-target

Local / Economy

Economic growth in the first quarter of this year will likely accelerate from the expansion seen in final two quarters of 2012 on the back of a surge in manufacturing and steady consumer spending. The government set a 6-7% target for this year after GDP expanded by 6.6% last year, or way above the high end of the full-year target range of 5-6%. In the fourth quarter alone, growth had slowed to 6.8 percent from the previous quarter’s 7.2%.

http://www.interaksyon.com/business/54971/growth-to-accelerate-in-1q-on-strength-of-manufacturing-ph-economic-managers-say

IIF: Capital inflows will continue to pose “implications” to emerging countries such as the Philippines. Poor returns in crisis-stricken US and Europe are “pushing” funds out of these countries, putting pressure on developing nations, particularly those from Asia. Emerging markets could attract private capital of as much as $1.118 trillion in 2013, representing the first increase since 2010. This, in turn, would create demand for currencies, putting them on an upward trend in terms of value. As a result, central banks will respond by lowering policy rates further in a bid to shun inflows. In particular, the peso could average 40 to a dollar this year, before inching up to as much as 39.20 next year. Equity investments are forecast to benefit in particular as growth prospects in emerging economies continue to be more favorable than in mature markets.

http://m.philstar.com/315469/show/baa8dd3789b0f0635a05a7d8a4763b8f&t=raf1qtkgtlctab20g8g1nfak32

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