Alerts

   Richard Lañeda, CFA

May 17, 2023. We maintain our BUY rating on AGI as shares are currently very undervalued. It is trading at a steep 31.65% discount to our FV estimate, which is based on a 25% discount to our NAV estimate of Php26.96. In addition to cheap valuations, AGI, through all its subsidiaries, is positioned capitalize on the resumption of economic growth.

   George Ching

Maintaining BUY rating- May 17, 2023 We have a BUY rating on FGEN with a FV estimate of Php31.85/sh. We continue like FGEN given its relatively stable cash flow since bulk of its capacity is contracted. Furthermore, with the Department of Energy’s moratorium on new coal power plants, this could potentially push forward the projected power shortage beginning in 2024, increase in the competitiveness of FGEN’s gas and renewables plants, and improve the feasibility of FGEN’s LNG regasification project which will enable its gas plants to remain viable after the depletion of the Malampaya gas field. At FGEN’s market price of Php18.70/sh., upside to our FV estimate is at 70%.

   Charles William Ang, CFA

May 17, 2023. We currently have a BUY rating on CHIB with a FV estimate of Php40.20/sh, based on 0.70x 2023E P/BV. We expect the bank’s lending business and core fee income to continue expanding as the economy continues to recover this year. We also believe that its asset quality will remain healthy as businesses continue to operate at higher capacities.

   Frances Rolfa Nicolas

May 17, 2023. Maintain HOLD rating. We currently have a HOLD rating on CHP with an FV estimate of Php0.95/sh. We think that the company’s margins will be muted this year amid weak demand and elevated input costs. Furthermore, the company faces intense industry competition, especially with a new entrant in the Visayas region bring additional capacity.

   Denise Joaquin

Maintain BUY rating- May 17, 2023 We maintain our BUY rating on URC with an FV estimate of Php163/sh. We continue to like URC for its strong core branded businesses where it has continued to hold its market leadership position in several consumer goods categories. Moreover, we expect bottomline growth to be supported by margin recovery given softer lock-in costs for most key inputs (e.g. wheat, palm oil, coffee) and structural cost improvements undertaken by URC. Additionally, we expect URC to remain a beneficiary of still-elevated sugar prices (April millsite prices +40% y/y for sugar; +20% for molasses)

   Richard Lañeda, CFA

May 16, 2023. We are raising our fair value estimate for BLOOM in line with the higher EBITDA and net income forecast for FY23 and FY24. Our FV estimate is raised from Php10.50 to Php13.50, implying a 22.7% upside from the current price of Php11.00. We continue to like BLOOM as a bottom-up pick as it is the primary gaming play in the Philippines. BLOOM has a market-leading position in mass gaming, supported by the growth in its premium mass segment and slots. Meanwhile, the VIP segment is making remarkable recovery as it does so without much contribution from Mainland Chinese players yet although we should see a recovery this year. We also believe despite the recent surge in share price, valuations are still undemanding as it implies a 2023 EV/EBITDA multiple of 9.5X versus the regional peer median of 14.6X.

   Richard Lañeda, CFA

May 16, 2023. We maintain our BUY rating on MEG given its robust residential segment and recovering malls and hotels. Its office segment remains a steady source of income and a strong anchor of the company’s value. Share of MEG are attractively valued, it being 53% below our fair value estimate. Relative valuation is also attractive as its trades around 4.6X FY22 P/E, 40% discount to the industry median.

   Carlos Matthew De Leon

May 16, 2023. In light of the weaker-than-expected 1Q23 results, we are reducing our revenue estimates for FY23E and FY24E by 6.2% and 7.0%, respectively. We are also tempering our margin estimates for by 20bps and 30bps for the said years. These resulted in lower bottomline estimates and a new FV of Php6.50/sh. Despite the lower FV, we are maintaining our BUY recommendation. We continue to like the company for its long-term recovery prospects and opportunities to capitalize on growth in the electric vehicle and renewable energy industries.

   George Ching

May 16, 2023. After increasing our operating cost estimates, we are reducing our 2023E net income forecast by 9.5% to Php11.1Bil, and our 2024E forecast by 6.8% to Php12.3Bil. However, after factoring in the Bulanjao property into our forecast, our FV estimate for NIKL is unchanged at Php8.2/sh. We are upgrading our rating on NIKL to BUY from HOLD. We continue to like NIKL given that prices for nickel will continue to be supported by the ongoing Indonesian nickel ore export ban. We also remain positive on the long term outlook for nickel due to the rising EV battery demand. Furthermore, we believe that NIKL’s expansion of its RE power generation business comes at an opportune time given the strong cash flow generation of its nickel mining business, as well as the tightening of power supply in the country. NIKL’s share price has declined by 22% from its peak in March is currently trading at 7.5X 2023E P/E. At the current price of Php6.15, there is a 33% upside to our FV estimate.

   George Ching

Maintaining BUY rating- May 15, 2023 We have a BUY rating on FPH with a FV estimate of Php154/sh. We are maintaining our BUY rating on FPH. Given FPH’s 68% ownership in FGEN, we view FPH as a cheaper way to own FGEN. FPH is trading at a huge 48% discount to its market based NAV of Php122/sh.mBased on FPH’s market price of Php63.8/sh, upside to our FV estimate is significant at 145%.