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Shariah-compliant listed firms increase

Posted on April 09, 2014

THE RANKS of listed firms found compliant with principles of Islamic law have grown following a quarterly review by the Philippine Stock Exchange (PSE).

An updated list of Shariah-compliant securities, uploaded on the PSE Web site on Monday, was longer at 61 out of 259 listed firms from the 47 in the first list released last December.

The latest list saw the exit of 12 companies: AgriNurture, Inc.; Alphaland Corp.; Alsons Consolidated Resources, Inc.; APC Group, Inc.; Basic Energy Corp.; Chemical Industries of the Philippines, Inc.; City & Land Developers, Inc.; Concrete Aggregates Corp. “A” and “B” shares; DFNN, Inc.; Keppel Philippines Properties, Inc.; Megawide Construction Corp.; and Philippine Realty & Holdings Corp.

There were 25 additions: Abra Mining & Industrial Corp.; Bogo-Medellin Milling Company, Inc.; Concepcion Industrial Corp.; Da Vinci Capital Holdings, Inc.; Dizon Copper Silver Mines, Inc.; Far Eastern University, Inc.; Federal Resources Investment Group, Inc.; Forum Pacific, Inc.; Globalport 900, Inc.; Greenergy Holdings, Inc.; IRC Properties, Inc.; iRipple, Inc.; Island Information & Technology, Inc.; ISM Communications Corp.; Jolliville Holdings Corp.; Millennium Global Holdings, Inc.; Minerales Industrias Corp.; MRC Allied, Inc.; NiHAO Mineral Resources, Inc.; Now Corp.; Pacifica, Inc.; SPC Power Corp.; Swift Foods, Inc.; United Paragon Mining Corp.; and Wellex Industries, Inc.

ATN Holdings, Inc. “A” and “B” shares, which were counted as one in the original list, were separated in the current roster.

Rounding up the latest list were: Aboitiz Equity Ventures, Inc.; Aboitiz Power Corp.; Apex Mining, Inc.; Araneta Properties Inc.; Asian Terminals, Inc.; Calapan Ventures, Inc.; Centro Escolar University; Chemrez Technologies, Inc.; Cirtek Holdings Philippines, Inc.; D&L Industries, Inc.; DMCI Holdings, Inc.; EEI Corp.; Holcim Philippines, Inc.; Ionics, Inc.; iPeople, Inc.; Jollibee Foods Corp.; Lafarge Republic, Inc.; Liberty Flour Mills, Inc.; Mabuhay Vinyl Corp.; Manila Bulletin Publishing Corp.; Manila Electric Co.; Marcventures Holdings, Inc.; Nickel Asia Corp.; Oriental Peninsula Resources Group, Inc.; Pepsi-Cola Products Philippines, Inc.; Philex Miing Corp.; Philex Petroleum Corp.; Philippine Long Distance Telephone Co.; Semirara Mining Corp.; Starmalls, Inc.; STI Education Systems Holdings, Inc.; Universal Robina Corp.; Vivant Corp.; and Vulcan Industrial & Mining Corp.

PSE tapped the services of San Francisco-based Islamic finance specialist IdealRatings, Inc. to screen listed firms every quarter against standards set by the Accounting and Auditing Organization for Islamic Financial Institutions.

To be Shariah-compliant, a firm’s primarily business should not be involved in conventional interest-based lending, insurance, mortgage and leasing, derivatives, pork, alcohol, tobacco, arms and weapons, embryonic stem cell research, hotels, gambling, casinos, music, cinema and adult entertainment. It can be involved in these activities but revenues from them should not exceed 5% of the total.

Moreover, interest-bearing debt and interest on deposits/investments should not exceed 30% against the company’s 12-month average market capitalization. Also, accounts receivables should not exceed 67% against the 12-month average market capitalization.