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Bloomberry stock price gets lift from PSE index inclusion

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Outlier

By Christine J. S. Castañeda
Senior Researcher

BLOOMBERRY RESORTS Corp. was the second most actively traded stock last week following the announcement that it will be included in the 30-member Philippine Stock Exchange index (PSEi) starting today (Feb. 18).

Data from the Philippine Stock Exchange (PSE) showed the Razon-led firm trading P2.59 billion worth of 208.8 million shares from Feb.11-15.

Bloomberry’s share price closed at P13 apiece on Friday, 7.79% higher than its share price of P12.06 when the market closed the previous week. Year to date, its share price rose 34.85% from P9.64 on the first trading day of the year.

“[Bloomberry’s] inclusion in the PSEi in lieu of [Petron Corp.] puts it back near the center of the radars of large institutional funds particularly those whose options are limited to index components, including but not limited to foreign-domiciled ones,” said Philstocks Financial, Inc.’s Research Head Justino B. Calaycay, Jr. in an email on Friday.

“As part of the main index, it is among the most liquid stocks which in some ways attracts such funds, reducing one possible source of risk,” he added.




Jervin S. de Celis, trader at Timson Securities, Inc., cited Bloomberry’s “bullish prospects for the gaming industry” and the syndicated P40-billion loan for the construction of its casino in Quezon City as factors that helped lift the company’s stock price.

“The expansion and PSEi inclusion will be a factor for big players in the market to invest more in the gaming stock,” Mr. de Celis said in an email.

In a statement issued on Feb. 8, the PSE said Bloomberry will be included in the 30-member benchmark index starting Feb. 18, replacing oil refiner Petron Corp. The stock’s weight in the index will be 1.3%.

The PSE ranks companies included in the PSEi based on their liquidity and market capitalization. Firms must have public ownership of at least 15%, and should also be eligible using relevant financial criteria.

Meanwhile, in a disclosure dated Feb. 11, Bloomberry said that its units — Sureste Properties, Inc. and Bloomberry Resorts and Hotels, Inc. (BRHI) — secured a P40-billion loan deal with banks to fund its integrated resort and casino project in Vertis North Complex in Quezon City. The company said that construction will start by the middle of the year, with target completion by 2022.

The project will carry the Solaire Resorts and Casino brand, and will be the listed firm’s second in the country. The first Solaire opened in 2013 at Entertainment City in Parañaque City with BRHI as the license holder and operator of the casino and Sureste operating its hotel and other non-gaming business.

The company’s net income attributable to parent rose 8.46% to P6.47 billion in the first nine months of 2018 from P5.96 billion in the comparable months of 2017. Its gross revenue during the period was up 13.94% to P31.91 billion from P28.01 billion previously.

“Income projection for [Bloomberry] in 2018 is P6.97 billion versus 2017’s P6.071 billion (14.81% growth),” Timson Securities’ Mr. de Celis said.

Mr. de Celis expects Bloomberry’s income in 2019 and 2020 to hit P7.47 billion and P8.949 billion, respectively.

Timson Securities’ Mr. de Celis placed the stock’s short-term support at P11 to P11.50 and resistance at P12.50 to P13.

For his part, Philstock’s Mr. Calaycay placed the stock’s support at P12 and resistance at P13.5 while providing major support and resistance levels at P9 and P14.5.

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