The Bellwether – 121

Releasing the 21st issue of The Bellwether, as published by FMIC's IAG-Research.

This is a fortnightly publication on market action and outlook.

The following are the highlights of the issue:

Puregold Price Club Inc. (PGOLD) drives Alcorn’s transition to Cosco Capital

Metro Pacific Investments Corp. (MPI) turns capex-heavy anew with PPP bag, balance sheet accomodative, 2012 arnings up 28%

Filinvest Land, Inc. (FLI) seeks more debt for

Puregold Price Club Inc. (PGOLD) drives Alcorn’s transition to Cosco Capital

Retail is Major Leg of the Holding firm Cosco Capital

Puregold (PGOLD) will be Alcorn Gold Resource Corp.’s (APM) major earnings driver as the latter restructures into a holding company called Cosco Capital which is pending SEC approval. The retail outfit of businessman Lucio Co (PGOLD) comprised half of Mr. Co’s recent asset injection of Php75bn into Cosco. In exchange, Mr. Co gets Cosco shares, 4.9bn in all at Php15/share, entitling him to a 94% interest in the holding co. (from the current 66%) after which a secondary offer will ensue next year to raise public float to the compliant level, say 10%, our assumption.

Metro Pacific Investments Corp. (MPI) turns capex-heavy anew with PPP bag, balance sheet accomodative, 2012 arnings up 28%

2012 Full Year Earnings Robustly Up 28%

Metro Pacific Investments (MPI) made 2012 core earnings of Php6.5bn, up 28% versus year ago’s Php5.1bn. Dividends also went up 33% to Php0.02/share. Earnings drivers were the water and electricity distribution utilities, the former on continuing billed volume growth of 6%, lower non-revenue water (NRW) of 43% on average for 2012 and the latter (electricity unit) due to MPI’s increased ownership of Meralco from 22% to 24.2% and 7% growth in electricity sales.

Filinvest Land, Inc. (FLI) seeks more debt for

Cheap

The second cheapest in the property sector on PE basis, FLI’s earnings may grow by 15% this year to Php3.85bn. 2012 earnings likely to close at Php3.3bn PE is 12.40x 2013 earnings versus 19x, peer property issues’ average.