Alerts

   Ed Martinez

The rationale for the amendment is for the ability to raise equity capital including, but not limited to, a rights offering, that the Corporation may undertake, subject to the final decision and approval of the Board of Directors. The Corporation is potentially looking to raise up to US$250Million which would allow it to improve its capital structure, fully fund the ongoing Solid Cement plant expansion and provide balance sheet flexibility. This amendment is a result of the evaluation of different funding options communicated during CHP 4Q’18 conference held in February 2019. Following this capital raising exercise, any unissued shares will be kept in the form of authorised but unissued share capital and the Corporation currently has no plans for any further fundraising.

   Frances Rolfa Nicolas

The consortium of Manila Water Philippines Ventures Inc. (MWVI), and Tubig Pilipinas Group Inc. (TPGI) recently inked a joint venture agreement for the development, improvement, and maintenance of Iloilo City’s water supply system. The consortium will be responsible for the construction and operation of a reliable and adequate water supply system in Metro Iloilo. The franchise has a period of 25 years and covers surrounding municipalities of Mandurriao, Arevalo, Molo, La Paz, Lapuz and Jaro.

   Frances Rolfa Nicolas

In a disclosure to the PSE, CHP announced that it has received from the Board of Investments the approval of the application of its subsidiary, Solid Cement Corporation, as a new producer of cement on a pioneer status but with non-pioneer incentives for its 1.5Mil MT new production line. (source: CHP) Consequently, we are increasing our FV estimate on CHP to Php3.2/sh and reiterate our BUY rating. We continue to like CHP as we expect 2019 to be a better year for the company driven by lower input costs and improving ASP. Moreover, valuations remain cheap. The stock is currently trading at 6.9X 2019E EV/ EBITDA, a discount compared to the median 2019E EV/EBITDA of 9.0X of its regional peers.