Meralco stock jumps on earnings, supply talks

March 6, 2023 | 12:01 am

By Abigail Marie P. Yraola, Researcher

SHARES in Manila Electric Co. (Meralco) moved upward last week as investors bought on its pre-pandemic-beating income report and news about negotiations with Aboitiz Power Corp. for a lower rate under another emergency power supply agreement (EPSA).

Data from the Philippine Stock Exchange showed Meralco ranking sixth in value turnover with P2.01 billion worth of 6.35 million shares changing hands from Feb. 27 to March 3.

Meralco shares finished at P315 apiece on Friday. On a weekly basis, the stock inched up by 1.9% from its P309.20 close on Feb. 23. For the year, the stock has grown by 5.4%.

Andrei Jorge G. Soriano, a research associate at China Bank Securities Corp., attributed the stock’s movement to its earnings report, which was released on Monday last week.

“Strong performance was driven by higher energy sales as volumes grew 6%,” he said in an e-mail, citing a sustained economic reopening such as the resumption of face-to-face learning and business activities, as well as better income contributions from its power generation business.

Mr. Soriano added that the price action in Meralco could have been influenced by flows related to the MSCI rebalancing, which concluded on Tuesday.

In a separate e-mail, Joylin F. Telagen, research head at IB Gimenez Research Securities, Inc., said that Meralco’s “excellent” financial report was also a factor and that price movement was due to traders and investors wanting to have a slice of the P11.028 cash dividend.

“For the year 2022, that will be a total of P16.834 versus the P15.283 in 2021, up by 10.15%,” she added.

The company booked a 10.2% increase in its consolidated core net income to P27.11 billion in 2022 compared with P24.61 billion a year earlier as energy sales surpassed pre-pandemic levels.

Energy sales grew by 6% to 48,916 gigawatt-hours (GWh) last year from 46,073 GWh in 2021, driven by sustained growth across all customer segments.

Meralco’s reported net income, which is adjusted to exclude one-time charges, grew by 21% to P28.43 billion.

Meanwhile, its consolidated revenues grew by 33.9% to P426.53 billion last year from P318.55 billion a year earlier.

Ms. Telagen estimates Meralco’s earnings at P6 billion for the first quarter of 2023 and P29.5 billion for the full year.

For Japhet Louis O. Tantiangco, senior research analyst at Philstocks Financial, Inc., Meralco’s net income in the first quarter may increase by 5%-9% based on initial projections while for full-year 2023, it may grow between 12% and 16%.

“These are hinged on the following assumptions: stronger energy sales for the year as the economy continues with its expansion; and improvements in the company’s cost efficiency,” he said in an e-mail.

Other reports also said that the electricity seller was negotiating for a lower rate with AboitizPower to forge another 300-megawatt EPSA for one month.

The company’s previous EPSA with AboitizPower unit GNPower Dinginin Ltd. Co. ran from Feb. 3 to 25. It was their second emergency supply deal to immediately replace a separate stalled agreement.

Earlier last week, Meralco said it was working on securing a power supply contract after its deal with GNPD ended on Feb. 25.

Last year, the company secured an EPSA with AboitizPower for P5.96 per kilowatt-hour from Dec. 15, 2022 until Jan. 25, 2023.

Mr. Soriano said that should the company secure a new EPSA, its impact is more likely on consumers.

“We think that it has minimal impact on MER’s profitability given that MER is a distributor, and power costs are generally passed through to consumers,” he said, referring to Meralco’s ticker symbol.

He added that under a new power supply deal, “rates would likely have a similar fuel pass-through mechanism, especially given the outlook for tighter supply as we head into the summer months.”

For Mr. Tantiangco, a new EPSA is deemed beneficial to Meralco as it would somehow help the company in managing its purchased power cost.

Mr. Soriano said investors should consider prospects of continued growth in energy demand as Meralco’s management placed energy sales volume in January to be up by 5%.

He also said that Meralco’s history of issuing dividends may highlight its position as a defensive stock. “Investors are also likely to closely monitor for developments relating to Meralco’s pending rate rebasing.”

For Ms. Telagen, Meralco is good to hold in the portfolio of investors looking for a stable and better dividend payout. She pegged the company’s support and resistance levels at P309 and P320, respectively.

For Mr. Soriano, support is at P308 while resistance is at P330.

Mr. Tantiangco sees immediate resistance at the P318 level and the next resistance at P329. He expects the support level at the P295-P300 range.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls.

Style (03/06/23)

March 6, 2023 | 12:01 am

Keds-Champion-Canvas-in-White-(Lifestyle)-2 — KEDS Champion Canvas in White

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Natori looks to roots in Spring

AN ode to Josie Natori’s Philippine roots and the art of Spanish culture, the Spring 2023 collections are an artisanal affair. An exotic exploration of bold prints, vibrant colors, and fun silhouettes, inspired by the beauty of Boracay, El Nido, and Amanpulo in the Philippines. After a celebratory year, marking 45 years, this next chapter is a culmination of Natori’s signature comfort and glam. Vibrant colors and ombrés bring the collections to life, enhanced by details such as micro beads, embroideries, and Maria Clara-inspired sleeves. The Natori Ready-To-Wear collection includes packable, throw-on-and-go dresses, caftans, bralettes, and other unique separates that feel versatile with an in or out of office appeal. New textures such as Guipure lace and calado open work, are inspired by Filipino craftsmanship and a dress Josie Natori’s mother, Angelita wore decades ago. The Josie Natori collection is resort ready. Textures, such as luxe linen, breathable cottons, and sultry silk feel rich and timeless. Piña, a key new fabric, is made from pineapple fibers, creating a fresh and natural appeal. The collection is enhanced with embroidery and sleek new shapes that feel slimming yet roomy at the same time. Natori is available at Rustans Makati and Rustans Shangri-La For more information, visit www.Rustans.com.

Footwear picks for Women’s Month

MARCH 8 is International Women’s Day and to celebrate, here is a list of shoes every kind of woman would appreciate, whatever stage she is in her life. The styles under Merrell’s Bravada collection may look dainty, but they’re tough enough for the trails as they are on pavement. Featuring a sleek take on the outdoor sandal, they include the Bravada Backstrap, Bravada Cord Wrap, and Bravada 2 Wrap. Buy any two pairs in any Merrell concept store and receive a Merrell branded T-Shirt free until April 30. Check out the full collection and more at www.merrell.com.ph. Then there is the Keds’ Champion which now comes in spring-ready shades of Sunny Lime, Light Pink, and Light Blue. Constructed in the signature circular vamp oxford style, the white Champion is a timeless classic that pairs well with virtually anything. This Women’s Month, get P500 off on a colored Champion pair when one buys a white pair — available online at www.keds.com.ph and Keds retail stores nationwide. While Sperry is known for their classic boat shoes, they also have a selection of classy and trendy minimalist sneakers. This March, get P500 off for a minimum purchase of P5,000 on full-priced women’s styles in a single receipt transaction. This promo is available exclusively in www.sperry.com.ph and retail stores nationwide.

The Peninsula’s spa journey

ENJOY a full-day spa journey this March at the Peninsula Manila Fitness Center. Start with a 30-minute body scrub, 90-minute full body massage, and a 60-minute facial treatment. Also, get full access to exclusive yoga classes in the morning and enjoy the Naturally Peninsula Afternoon Tea Set and breakfast menu. Available every Tuesday, Thursday, and Saturday from March 1 to 31,

Fendi’s womenswear Autumn/Winter 2023

FOR AUTUMN/WINTER 2023, Kim Jones explores classicism and elegance through the lens of subtle subversion. Drawing directly upon the wardrobe of Delfina Delettrez Fendi — how she wears her Fendi archive with an instinctive sense of self-expression — here is a collection which plays with binaries: the exploration and elevation of deconstruction; the interpolation of gendered archetypes; the disturbance of ladylike sophistication. The pieces are designed to be worn every which way. Masculine tailoring and traditional fabrics are twisted into feminine forms, while elements of utilitarianism appear throughout: boilersuits, aprons, uniforms. Lace is lacquered and layered; flashes of fetishism appear through slips of lingerie peeking through, or thigh-high lace-up boots. A clean-cut mac falls open to flash its sequined lining; bias-cut draped dresses or Persian lamb bibs appear with harnessed straps. In a perfected perspective on punk, knitwear appears cleanly slashed or gently warped. Felted wools are slightly shrunken, ribbed knits left unbuttoned, or worn askew. Satin dresses with a twisted drape are romantically trailed by billowing scarves. With graphic motifs drawn from the Autumn/Winter 1996 Fendi archive seamlessly expressed in intarsia, alongside Karl Lagerfeld’s 1981 sketches for multipurpose knitwear offering a formative inspiration, the history of the House is reflected anew. There is also a new handbag, the Fendi Origami, with a shape which has been engineered to transform between two distinct silhouettes.

COS and Linda Farrow collaborate on eyewear

COS celebrates the launch of sunglasses for the first time in Philippines through a pioneering collaboration with eyewear designer Linda Farrow. Established in 1970, Linda Farrow was a pioneer in showcasing glasses as true fashion accessories. The collaboration’s nine-piece collection contains five iconic styles, from aviator to wayfarer which elevate the everyday. Featuring cut-outs, gold accents, and a spin on contemporary color ranges, quality sits at the forefront of design while all lenses provide 100% UV protection. The collection is available globally on cos.com and in the COS Store at SM Aura for a limited time only.

Furla introduces its first bag in biodegradable leather

FURLA has reinterpreted an icon from its 1990s archives with a modern twist. Unica Furla Earth Limited Edition is the first Made in Italy bag in biodegradable leather realized in collaboration with Cyclica. Thanks to Oleum, the brand which identifies the biodegradable leather line produced by Cyclica, the Unica Furla bags follow a circular model for their production. The leathers, which are meant to become Oleum originate from traceable European farms, which are by-products of the food industry and are vegetable tanned with wastewater from oil production, thus avoiding the direct use of aldehydes and glyphosate. The leather is metal-free and environmentally non-toxic. Dyeing is done with components such as corn, spirulina, logwood bark, and fern, free from synthetic agents and heavy metals. Performance comparable to that achieved through traditional manufacturing is conferred by natural elements such as beeswax or specific salts used for the finishings. Unica Furla Earth Limited Edition retains Furla’s architectonic DNA: a maxi or medium-sized crossbody bag with a sculptural profile that is softened by soft curves with well-finished details such as the metallic turn-lock closure with the stylized arch logo and the Furla macro lettering impressed on the external bottom. Colors range from mogano (purple) to mais rosa (pink), from spirulina (azure) to clorofilla (green) in addition to deep black and pure white. Unica Furla Earth Limited Edition is available globally on Furla.com and in selected flagship stores. In the Philippines, Furla is located at Central Square in Bonifacio High Street Central, Greenbelt 5, Newport Mall, Power Plant Mall, Rustan’s Makati, Shangri-La Plaza East Wing, and online at Trunc.ph, Rustans.com, and Zalora.

Gap blooms this spring

GAP brightens a wardrobe with the colors of spring. The Men’s default Gap outfit — denim and tees — has a springtime touch with floral logo tee updates. Women can find poplin shirts, sustainably-made denim, sweatshirts, and dresses in spring colors and florals. Even the kids get a touch of spring. Visit the following Gap stores to catch these Spring Essentials for all: Glorietta 4, Shangri-la Mall, SM Mall of Asia, SM Megamall, Trinoma, Alabang Town Center and Abreeza, Davao, or shop online at gap.com.ph.

Rustan’s summer trends

RUSTAN Marketing Corp. has put together a list of some of summer’s must-have items, designed to make one’s summer vacation enjoyable and stress-free. First there is Nuxe Super Serum containing natural hyaluronic acid and micro-spheres of fractionated botanical oils delivering powerful anti-aging correction in a single bottle. The Nuxe Super Serum Gift set includes a pink quartz Gua Sha, a facial massage tool known for its firming properties. Achieve flawless legs with Sally Hansen Airbrush Legs, water- and transfer-resistant leg makeup for coverage of freckles, veins, and imperfections. There is also the Sally Hansen Airbrush Legs Illuminator with a hydrating and quick-drying formula. No time for a full-face makeup? Max Factor’s Masterpiece Divine Lashes Waterproof Mascara is all that is needed. This mascara provides clump-free application and soft volume that builds up layer after layer. Achieve the latest summer hairstyles with a bouncy and glossy look using the VS Sassoon Moistwrap Straightener. Its innovative Moistwrap technology delivers moisture retention, protection, and smoothness, resulting in shiny and frizz-free hair. Meanwhile, the BaByliss Hydro-Fusion Air Styler can give salon-level locks at home. This large rotating brush with ceramic barrel and soft polishing bristles will guarantee a smooth, frizz-free finish that adds shape and bounce to your locks. Add a pop of color to your nails with the OPI Nature Strong Collection, a high-performing, natural origin nail lacquer with long-lasting properties and various vibrant color options. Start the day with the luminous scents of Solinotes Freesia Eau de Parfum (EDP) with freesia notes, osmanthus and sandalwood. Guess Bella Vita Rosa EDT opens with sparkling Italian lemon, cassis, and quince, leading to a lush exotic floral heart of jasmine, magnolia, cypress, and muguet, and ends with orris flower, moss, and sandalwood for an unforgettable feminine trail. There is also the zen scent of the Maison Margiela REPLICA Matcha Meditation EDT, with bergamot and orange blossom essences, matcha tea accord and benzoin. Or try an intensely sensual and opulent note with Viktor&Rolf Flowerbomb Ruby Orchid EDP, featuring intense ruby flower orchid and red foxy vanilla bean accords, vine peach and red fruit notes. Packing your bags for a trip? Try Samsonite’s award-winning Beamix collection, which seamlessly merges form and function to create a sleek and minimalist luggage masterpiece. Equipped with an integrated fingerprint lock that stores up to 20 unique fingerprints and an Aero-Trac Suspension II wheel system that minimizes rolling vibration. For a go-to daypack, the High Sierra Loop Backpack is a jack-of-all-trades with a multitude of compartments, adjustable compression and bottom webbing straps. Stay breezy with the Jack Nicklaus Geometric Print Polo Shirt whose StayDri moisture-wicking technology and UV protection make it an ideal choice for summer activities. Elevate an ensemble with the Champion Classic Twill Hat, a brushed cotton twill cap that boasts a unisex fit and leather adjustable back strap. Its minimalist design is accented by the embroidered Champion script logo. Go on summer dinner dates in style without compromising comfort with Easy Spirit Morgana Loafers, a classic slip-on that boasts superior traction, flexibility, and arch support. For a more casual affair, the Easy Spirit Aggie Slip-on Loafers have cloud-like cushioning, a breathable sock liner, and flexible outsole.

Montblanc opens new NEO 3.0 boutique concept

MONTBLANC has opened a new boutique at Solaire Resort Entertainment City at Parañaque. Leather goods, watches, and writing instruments from the On the Move collection were highlighted at the opening. The boutique is the first in the Philippines to showcase the newly enhanced NEO 3.0 concept. Key collections and products are incorporated into the store’s design as unique themes. The designer Noé Duchaufour-Lawrance drew inspiration from the fluid, cursive handwriting evocative of Montblanc’s signature fountain pen. With new materials such as walnut and travertino, black lacquer and wood; a minimalist design, and warm lighting, the space is elegant and inviting, allowing patrons to focus on the most important aspect — the products themselves. The boutique also pays tribute to its origins by incorporating a Meisterstück counter, which pays homage to the signature Meisterstück collection. The boutique’s immersive experience is further elevated with leather wall fittings that highlights the Maison’s diverse key leather collections, ranging from the timeless Meisterstück to the recently launched collection made for those with a fast-paced and active lifestyle — Extreme 3.0. The Montblanc boutique is on the Ground Floor of The Shoppes, Solaire Resort Entertainment City. It is open from 11 a.m. to midnight daily.

Lazada holds first 11-day sale

ECOMMERCE pioneer Lazada celebrates its 11^th anniversary with an 11-day long #LazadaPH11Birthday, which runs from March 3-13. Lazada has teamed up with brands such as Forever 21, Penshoppe, and Mikana Jewelry to help fashionistas bring their dream outfits to life. As part of the celebration there is a LazLook Mannequin exhibit at the Activity Center of Market! Market! from March 2 to March 29, showcasing epic styles, stackable vouchers, up to P1,000 cashback as well as deals for as low as P99 and up to 80% off. Lazada has online and in-app challenges and giveaways. Together with partner banks, Lazada is giving shoppers the opportunity to avail of vouchers that they can use during the 11^th Birthday Sale, like Bank of Commerce’s discount for up to P2,000 off (on a minimum spend of P2,500), Metrobank’s P1,000 voucher (on a minimum spend of P2,000), and many more. Lazada has created an Instagram filter where shoppers can play to get vouchers worth over P100,000. These are just some of the deals to be found during the sale. To stay updated on all the programs and promos, follow https://www.facebook.com/LazadaPhilippines.

Shopee launches the 3.3-3.15 Mega Shopping Sale

SHOPEE launches its first mega campaign of the year, the 3.3-3.15 Mega Shopping Sale with deals and offers for shoppers. Ongoing until March 15, users can enjoy daily free shipping vouchers at ₱0 minimum spend, 15% off vouchers, up to 50% off deals, and more. Every day of the sale, shoppers can enjoy discounts and vouchers on various categories. From March 1-15, shoppers, fashion and beauty finds will feature discounts of up to 90% and ₱199 & Below deals. Shopee offers a personalized shopping experience with SkinCam, an AI-enabled diagnostics tool that identifies different areas for skin improvement and recommends a skincare routine complete with products to address each concern. And just in time for the sale, Shopee partnered up with even more brands to make personalized skincare shopping more accessible for all. These include skincare products from Innisfree, Laneige, Pond’s, Olay, and Senka. Shopee users can look forward to special discounts when they use exclusive voucher codes from its bank partners. Qualified Credit, Debit and Prepaid cardholders (new and existing Shopee users) can enjoy savings of up to ₱500 and cashback of up to ₱1,500 with any of the voucher codes when they purchase on Shopee. More details can be found on the 3.3 Partner Promos page.

Heat wave in India hinders gov’t efforts to stockpile wheat

March 6, 2023 | 12:01 am

NIWAI, India — A heatwave in northern and central India at a time the crop is ripening is threatening to damage grains and dent the country’s wheat production for the second straight year.

The reduction in production amid a drop in inventories to the lowest level in six years may force the world’s second biggest producer of the grain to allow imports after banning exports last year.

“Winter hasn’t ended yet, but during the day temperatures rise like summer,” said Rameshwar Chowdhury, who has planted wheat on six acres in the Niwai village in the northwestern state of Rajasthan. “We are irrigating fields to limit the impact, but beyond that we can’t do anything.”

The maximum temperature in some wheat-growing areas jumped above 39 degrees Celsius for a few days in February, nearly 10 degrees Celsius above normal, according to weather department data.

Higher temperatures would lead to early maturity of the crop and grains could be shrivelled, like they were last year, said Mr. Chowdhury.

India recorded its highest ever maximum temperature in February and the weather office has warned the country is likely to experience another heatwave in March, especially in the key wheat-producing central and northern states.

A heatwave in March could further harm the crop, which has already been showing signs of stress, said another farmer, Gopilaal Jaat.

In 2022, a heatwave in March curtailed India’s wheat production to 100 million tons against local consumption of 103.6 million tons, estimates the US Department of Agriculture’s Foreign Agricultural Service.

India last month estimated wheat production in 2023 could rebound to a record 112.2 million tons, but trade bodies are less optimistic due to the heatwave.

“Higher temperatures in March can trim output by 4 to 5 million tons. We are estimating production of around 106 to 107 million tons,” said Pramod Kumar S, president of the Roller Flour Millers’ Federation of India (RFMFI).

Global and Indian trade houses are even more bearish and forecasting a far bigger drop in production. “We trimmed the estimate to 103 million tons from 109 million tons,” said a New Delhi-based dealer with a global trading firm, adding production could fall to around 100 million tons if temperatures remain above normal in March as forecast by the weather department.

Lower production would keep wheat prices above the government’s buying price and encourage farmers to sell to private players, the dealer said.

State purchases fell by 53% in 2022 to 18.8 million tons, pushing up local rates and forcing the government-backed Food Corp. of India (FCI) to release 5 million tons of the grain from its reserves to cool prices.

But the sales, which are ongoing, would halve the government’s stocks at the start of the April-March marketing year to 10.2 million tons, the lowest in six years, estimates USDA.

To replenish stocks, the government is aiming to procure about 34 million tons from farmers in 2023. “The government will do everything to ensure food security and to keep prices under control. It can even allow imports if needed,” said Mr. Kumar of RFMFI. — Reuters

Multisys partners with Bruneian firm DST to co-develop a digital platform for telcos

March 6, 2023 | 12:01 am

From left to right: DST Vice-President of Information Technology, Digital & Innovation, Digital Business Andy Lai Boon Ho; DST CEO Radin Sufri Radin Basiuni; DST Chairman Awang Haji Sofian bin Hj Mohd Jaini; Multisys CEO & President Victor Aliwalas; and Multisys Vice-President for Technology Nico Penaredondo

PLDT-backed software solutions provider Multisys Technologies Corporation is set to co-develop an all-in-one telco, fintech, and mobile commerce digital platform with Brunei’s largest telco company, Datastream Digital Sdn Bhd (DST).

The two companies recently signed a Joint Intellectual Property (IP) Development and Commercialization Agreement in Bandar Seri Begawan, Brunei. The ceremony was witnessed by Awang Haji Sofian bin Hj Mohd Jaini, Acting Managing Director of Brunei Investment Agency and Chairman of DST Digital. Also in attendance was Her Excellency Marian Jocelyn R. Tirol-Ignacio, Philippines Ambassador to Brunei Darussalam.

Under the agreement, the two companies will co-develop an end-to-end telco business operations support system, which will be integrated with five flagship platforms of Multisys. This aims to expand the horizon of services offered by DST—providing solutions beyond the traditional telco services.

Multisys CEO & President Victor Aliwalas shared that the platform will be jointly marketed as a Platform as a Service offering beyond Brunei and the Philippines.

“This Joint Intellectual Property Development and Commercialization Agreement is a step further into our synergetic journey with DST. We are eager more than ever to spearhead the development and architecture of a specialized digital ecosystem, side by side with DST who has been very collaborative and professional from day one. Our legacy is to help seamlessly manage various operational activities for the telco market, not just in Brunei or the Philippines, but also in the entire region,” Aliwalas said.

To accomplish this feat, DST is allocating about 15 local DST developers to collaborate with around 20 Multisys’ full-stack developers and project team. Through this synergy, DST and Multisys aim to roll out the first tranche of its IP development by the fourth quarter of the year.

DST CEO Radin Sufri Radin Basiuni said, “Co-owning Intellectual Property is a fundamental direction for a DigitalCo innovation strategy. The core of our vision is also believing in our own teams. DST has geared to increasing its development team and also undertook reskilling and upskilling exercises to all its disciplines to realize its digital aspirations. Around 15 local DST developers will be involved in the collaboration with Multisys in-house development team. DST further continues to harness and develop further the Bruneian innovation culture through its own DST InnoLab and Brunei Innovation Lab.”

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Yields on government debt rise ahead of inflation data

March 6, 2023 | 12:01 am

YIELDS on government securities (GS) rose last week on expectations of faster February inflation.

GS yields, which move opposite to prices, went up by an average of 10.41 basis points (bps) week on week, based on PHP Bloomberg Valuation Service Reference Rates as of March 3, published on the Philippine Dealing System’s website.

Rates at the short end of the curve rose, with the 91-, 182-, and 364-day Treasury bills (T-bills) going up by 11.82 bps (to 4.617%), 3.49 bps (5.1764%), and 16.25 bps (5.6089%), respectively.

The belly of the curve also increased, with the rates of the two-, three-, four-, five-, and seven-year Treasury bonds (T-bonds) going up by 1.42 bps (to 5.6673%), 0.18 bp (5.8025%), 3.74 bps (5.9454%), 8.47 bps (6.0847%), and 12.81 bps (6.2815%), respectively.

At the long end of the curve, the 10-, 20-, and 25-year debt papers gained 13.18 bps, 20.65 bps, and 22.50 bps to yield 6.4496%, 6.7439%, and 6.758%, respectively.

Total GS volume traded reached P7.773 billion on Friday, lower than the P13.022 billion on Feb. 23.

Yields rose as traders were on the defensive after the Bangko Sentral ng Pilipinas (BSP) said February headline inflation could have reached 9% last month, a bond trader said via e-mail.

“Local yields broadly moved up as the BSP inflation forecast hinted at potentially higher inflation for February and raised expectations of a stronger local policy rate hike this month,” the trader said.

“While local markets were definitely looking forward to the central bank’s estimate, bond yields already increased as the stronger-than-expected PCE (personal consumption expenditures) inflation report in the US,” the trader added.

February inflation likely settled within the 8.5% to 9.3% range, the BSP said last week. This would follow January’s 8.7% print, which was the quickest since November 2008.

If realized, February would mark the 11^th straight month that inflation would exceed the BSP’s 2-4% target range.

The upper end of the forecast would also be the fastest headline print recorded in more than 14 years or since the 9.7% recorded in October 2008.

The Philippine Statistics Authority will release the February consumer price index report on March 7, Tuesday.

BSP Governor Felipe M. Medalla said on Friday that the central bank may hike rates by another 50 bps this month if February inflation rises above 9%.

The Monetary Board will hold its second policy meeting for this year on March 23.

At its Feb. 16 review, the BSP hiked benchmark interest rates by 50 bps for a second straight meeting, bringing its key rate to 6%, the highest in nearly 16 years.

The Monetary Board has increased borrowing costs by a total of 400 bps since May 2022 to tame inflation.

Meanwhile, the US PCE price index shot up 0.6% last month after gaining 0.2% in December, prompting hawkish comments from US Federal Reserve officials.

“While the moves of the US central bank might still continue to induce short-term fluctuations in the market, local bond yields are largely seen to be more vigilant about the BSP’s policy moves and domestic inflationary dynamics instead after the BSP decided to un-anchor its moves from the US Federal Reserve last February,” the bond trader said.

A second bond trader also said in a Viber message that expectations of a higher terminal rate in the US have been priced in.

“Bond markets will likely remain defensive with inflation continuing to put pressure on central banks globally, including BSP. As such, BSP will likely counter any moves of the Fed with an equal magnitude of tightening,” the second trader added.

For this week, both traders expect secondary market yields to continue rising due to the February inflation report.

“Yields are likely to move broadly higher [this] week amid expectations of continued uptick in the domestic inflation. A stronger inflation print will give enough room for long-term yields to continue increasing. However, short-term yields might move faster due to potentially stronger rate hike expectations from the BSP,” the first trader said.

“I expect traders to remain defensive in the upcoming weeks as they recalibrate their expectations based on current market outlook,” the second bond trader added. — Bernadette Therese M. Gadon

How PSEi member stocks performed — March 3, 2023

March 6, 2023 | 12:00 am

Here’s a quick glance at how PSEi stocks fared on Friday, March 3, 2023.

Analysts’ February 2023 inflation rate estimates

March 6, 2023 | 12:00 am

PHILIPPINE INFLATION likely further quickened in February, with upward pressure expected from higher prices of cooking gas and food, analysts said. Read the full story.

Stocks to trade sideways ahead of key PHL data

March 5, 2023 | 9:00 pm

LOCAL EQUITIES are expected to trade sideways this week as investors await key economic data releases.

The Philippine Stock Exchange index (PSEi) went up by 32.92 points or 0.49% to end at 6,655.37 on Friday, while the broader all shares index gained 15.24 points or 0.42% to close at 3,564.42.

Week on week, however, the PSEi dropped by 30.53 points or 0.46% from its close of 6,685.90 on Feb. 23.

“The local market climbed this Friday, fueled by positive cues from Wall Street overnight. Investors also digested the positive statements from the Bangko Sentral ng Pilipinas Governor Felipe M. Medalla as he stated that the economic growth in the country will likely reach the government’s 6-7% target despite the rising interest rates,” Philstocks Financial, Inc. Research and Engagement Officer Mikhail Philippe Q. Plopenio said in a Viber message.

On Friday, the Dow Jones Industrial Average climbed 387.40 points or 1.17% to 33,390.97; the S&P 500 added 64.29 points or 1.61% to 4,045.64; and the Nasdaq Composite went up by 226.02 points or 1.97% or 11,689.01.

Meanwhile, Mr. Medalla last week said there is room for a few more interest rate hikes that will not affect growth. He said the Monetary Board could consider a rate hike of 50 basis points (bps) at its March 23 meeting if February inflation exceeds 9%.

The BSP raised its benchmark interest rate by 50 bps at its first policy meeting of the year on Feb. 16, bringing the key rate to 6%, the highest in nearly 16 years.

Since May 2022, the BSP has raised policy rates by a total of 400 bps.

For this week, Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said investors will take cues from February consumer price index data.

“A February inflation print that is slower than January’s 8.7% may somehow lift sentiment since this may lead to a less hawkish stance by the BSP. However, a February inflation print that exceeds the prior month’s 8.7% may lead to a market decline as it strengthens the case for another aggressive move by the BSP,” Mr. Tantiangco said.

“Investors may also look into our upcoming labor force survey and foreign direct investments data for more clues on the local economy,” he added.

A BusinessWorld poll of 17 analysts yielded a median estimate of 8.9% for February headline inflation, within the 8.5% to 9.3% estimate of the BSP.

If realized, this will be faster than the 14-year high print of 8.7% in January and the 3% a year earlier.

“For the coming week, we could expect a short rebound following the release of Philippine inflation data, but optimism will still be tempered by the potential 50-bp rate hike from BSP,” AP Securities, Inc. Equity Research Analyst Carlos Angelo O. Temporal said in a Viber message.

Mr. Temporal placed the PSEi’s support at 6,500 and resistance at 6,800, while 2TradeAsia.com put the index’s support at 6,400-6,500 and resistance at 6,750-6,800. — Ashley Erika O. Jose

Peso to climb on rate hike expectations

March 5, 2023 | 9:00 pm

THE PESO could strengthen against the dollar this week as the market expects the Bangko Sentral ng Pilipinas (BSP) to deliver another large rate hike at its next meeting as inflation could have reached a fresh peak last month.

The local currency closed at P54.82 versus the greenback on Friday, appreciating by 19 centavos from Thursday’s P55.01 finish, Bankers Association of the Philippines data showed.

Week on week, the peso rose by five centavos from its P54.87 finish on Feb. 23.

The peso opened Friday’s session at P54.95 per dollar. Its weakest showing was at P54.98, while its intraday best was at P54.745 against the greenback.

Dollars exchanged rose to $1.287 billion on Friday from $1.276 billion on Thursday.

The peso appreciated against the dollar following hawkish statements from the Bangko Sentral ng Pilipinas (BSP) chief, a trader said in a Viber message.

“This could also support more comfortable interest rate differentials that somewhat support the peso,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

BSP Governor Felipe M. Medalla on Friday said they could hike borrowing costs by another 50 basis points (bps) this month in the “worst-case scenario” of inflation rising above 9% in February.

The central bank’s move at its March 23 meeting could be a 25-bp or 50-bp rate increase, depending on the latest economic data, he said.

The BSP raised its benchmark interest rate by 50 bps at its first policy meeting of the year on Feb. 16, bringing the key rate to 6%, the highest in nearly 16 years.

Since May 2022, the BSP has raised policy rates by a total of 400 bps.

For this week, the trader and Mr. Ricafort said the peso’s movement against the dollar will depend largely on the February inflation data.

A BusinessWorld poll of 17 analysts yielded a median estimate of 8.9% for February headline inflation, within the 8.5% to 9.3% estimate of the BSP.

If realized, this will be faster than the 14-year high print of 8.7% in January and the 3% a year earlier.

February would also mark the 11^th consecutive month inflation beat the BSP’s 2-4% target.

The Philippine Statistics Authority will release February consumer price index data on March 7, Tuesday.

Mr. Ricafort expects the peso to trade between P54.60 and P55.10 per dollar this week, while the trader sees the local unit moving from P54.50 to P55.25. — A.M.C. Sy

Funding for free WiFi in remote areas hits P2.5 billion in 2023

March 5, 2023 | 7:42 pm

Mobile-phones — STOCK PHOTO | Image by terimakasih0 from Pixabay

INFORMATION and Communications Technology Secretary Ivan John E. Uy said his department has about P2.5 billion this year to roll out free WiFi services in remote parts of the Philippines.

“For this year, the total free WiFi or Broadband ng Masa (budget), everything is I think around two and a half billion,” Mr. Uy told BusinessWorld on the sidelines of the project launch in Antique Province.

On March 3, the Department of Information and Communications Technology (DICT) and Senate President Pro Tempore Loren B. Legarda launched Broadband ng Masa in Antique across six sites within the campus of the University of Antique, as well as in Barangay Calo-oy in Sibalom.

For 2023, the DICT plans to increase the number of activated WiFi sites in Antique to 150 which will be located in: the university’s Sibalom, Tario Lim Memorial, Libertad, Caluya, and Hamtic campuses and in 145 barangays.

“I am glad that the DICT, headed by Secretary Ivan John Uy, heeded our call to bring the Broadband ng Masa program to Antique to install WiFi sites in the different University of Antique campuses, and in other parts of the province, including in indigenous community areas,” Ms. Legarda said.

Next year, Ms. Legarda said the goal is to install free WiFi sites in the remaining barangays of Antique province.

“By 2024, (we will pursue) full digitalization of the whole of Antique, for all of the 590 barangays,” she said.

The free WiFi service will be implemented via a combination of fiber optic and terrestrial wireless-based high-speed internet service starting in San Jose de Buenavista, the provincial capital, and Libertad.

According to Mr. Uy, the next installations of the free WiFi sites will “depend on where we have the funding to proceed,” Mr. Uy said.

Antique is the first province on Panay Island to be connected through the Broadband ng Masa project.

Mr. Uy said that the DICT is looking to impose restriction on free WiFi use.

These include a cap on downloads and blocks on pornographic and gambling sites.

“We are already developing all those capabilities to manage the WiFi sites. Right now, we are still assessing,” Mr. Uy said. — Justine Irish D. Tabile

CALAX Aguinaldo section seen completed by June

March 5, 2023 | 7:41 pm

THE Department of Public Works and Highways (DPWH) said it has set a June target for completing the P35.7-billion Cavite-Laguna Expressway (CALAX) project up to the Silang (Aguinaldo) Interchange.

“We hope in two to three months … we can finish up to the Aguinaldo (interchange),” Public Works Secretary Manuel M. Bonoan told reporters recently.

The nearly 45-kilometer CALAX project is expected to cut travel time between South Luzon Expressway and the Manila-Cavite Expressway to 45 minutes from the current 2.5 hours.

It is expected to reduce congestion along Governor’s Drive, the Aguinaldo Highway and the Sta. Rosa-Tagaytay Road, and boost the competitiveness of Region IV-A or Calabarzon (Cavite, Laguna, Batangas, Rizal, and Quezon).

According to Mr. Bonoan, the government has completed the acquisition of right of way for the Aguinaldo section of the project.

The DPWH hopes to deliver the remaining right-of-way acquisitions for the entire length of CALAX within the year.

“I was able to talk to the Department of Budget and Management (DBM) and they assured me that they will be releasing the funds necessary for the acquisition of the right of way for CALAX,” he added.

For this year, Mr. Bonoan said that the DBM and the DPWH set aside about P2 billion for CALAX right-of-way acquisition.

CALAX is a public-private partnership project with the DPWH and MPCALA Holdings, Inc., a subsidiary of Metro Pacific Tollways Corp. (MPTC).

MPTC is the tollways unit of Metro Pacific Investments Corp., which is one of the three key Philippine units of Hong Kong-based First Pacific Co. Ltd. together with Philex Mining Corp. and PLDT, Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Justine Irish D. Tabile

Fisherfolk seek cancellation of Cavite dredging environmental clearance

March 5, 2023 | 7:41 pm

manila-bay-fisherfolk — PHILSTAR/KRIZ JOHN ROSALES

FISHERFOLK have asked the Department of Environment and Natural Resources (DENR) to revoke the environmental compliance certificate (ECC) granted for the two dredging projects in Cavite, citing the impact on their livelihood.

“Since the beginning of dredging in the municipal waters of Naic in 2021, fishermen’s income has dramatically decreased to only an estimated P300 for two days of fishing,” Fernando L. Hicap, chairman of the Pambansang Lakas ng Kilusang Mamamalakaya ng Pilipinas (PAMALAKAYA), said in a statement.

According to PAMALAKAYA, Silverquest Mining Resources, Inc. received an ECC for a seabed quarry project in 2021.

The project covers 2,214 hectares of municipal waters off Ternate and Naic, Cavite.

Another clearance was issued to Dutch dredging firm Royal Boskalis Westminster N.V. (Boskalis) in Rosario, Cavite, PAMALAKAYA said.

Both activities support the reclamation and development projects conducted within Manila Bay.

According to Mr. Hicap, the dredging has resulted in reduced catches of common whiting (asohos), red sea bream (besugo), and blue crab (alimasag) due to the noise and pollution caused by dredging.

Citing a study by the Ecosystems Research and Development Bureau, a research arm of the DENR, Mr. Hicap said that nearly 72% of coral reefs in Cavite are under threat of destruction.

He also claimed no public consultation was conducted before the dredging projects were approved.

The DENR was asked to comment but had not replied at the deadline. — Sheldeen Joy Talavera