PLDT shares drop despite good news

PLDT, Inc. shares fell 1.3% week on week to P1,284 each on Friday, as investors priced in expectations about a company plan to boost its customer base by distributing free subscriber identity module (SIM) cards in the countryside.

The stock fall was in line with the Philippine Stock Exchange Index’s (PSEi) 1.3% decline to 6,147.44 points on March 28 from a week earlier. The share has declined 0.8% this year.

The PLDT stock was the 13th most traded share on the stock exchange last week, with value turnover hitting P485.7 million covering 376,450 stocks.

The company last week said it would provide through its mobile arm Smart Communications, Inc. half-a-million free SIM cards to remote areas in the Philippines in support of a government initiative to boost mobile connectivity.

“PLDT’s initiative on SIM cards somehow brought optimism about an increase in its users, which offset the worries regarding industry competition,” Jeconiah S. Nicolas, a research analyst at First Resources Management and Securities, said in a Viber message.

“But the announcement by Converge ICT Solutions, Inc. of their partnership with Elon Musk’s Starlink has raised concerns about tightening competition in the telecommunication industry,” he added.

Converge said it estimates a 5% to 10% increase in enterprise revenue through its collaboration with Elon Musk’s Starlink. On Tuesday, the listed fiber-optic network operator announced its tie-up with Starlink to extend broadband access to remote areas, strengthening enterprise connectivity nationwide.

PLDT’s net income increased 21.4% to P32.3 billion in 2024 from a year earlier, while revenue rose 2.8% to P216.83 billion.

“For the first-quarter revenue, we expect PLDT to post P61.07 billion, and for the whole year, we expect it to record P227.9 billion,” Mr. Nicolas said.

He put the support level for the PLDT stock at P1,255 and resistance at P1,400.

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. — LOP