Megaworld confident of PSEi comeback plus more market updates
Ayala Corp [AC 640.00 1.6%; 23% avgVol] [link] confirmed a Business Mirror article reporting on the opening of the GMAC Logitech Refrigeration Corp’s new cold chain storage facility in Cagayan de Oro.
GMAC Logitech is a joint venture between AC Logistics Holdings, a subsidiary of AC, and Glacier Megafridge, one of the largest private cold storage providers. The new GMAC Logitech Refrigeration facility has a capacity of 5,348 pallet positions.
MB Quick Take
All of the largest and most successful cold storage providers are private companies, so for the conglomerates that want to get into the cold storage space (and they all do), growth in this space will have to come through some interface with these private firms. Glacier Megafridge is a decent mid-level provider, but there are still some private giants out there like Royale Cold Storage (RCS) that could attract attention from some of the other family corps like SM Investments [SM 916.00 0.3%; 104% avgVol] and JG Summit [JGS 46.50 0.4%; 9% avgVol]. Any deal with RCS would immediately put that conglo at the top of the pile in the industry.
Megaworld [MEG 1.96 2.0%; 127% avgVol] [link] said that “in the future”, it is “confident that Megaworld will be added back to the [PSEi] index”. MEG was dropped from the PSEi earlier this year, which Chief Strategy Officer Kevin Tan said was due “only to the loss of interest in the property sector”, and not because of “Megaworld’s actual performance.”
Mr. Tan said that MEG will “remain positive” on the commercial property market, betting that health care BPOs will “continue to grow” and be a “huge opportunity in the future.”
MB Quick Take:
As we discussed earlier, the vast majority of the action and liquidity is in the 30 stocks that are picked to be a part of the PSEi index. Inclusion in that index makes any stock a potential target of additional buying interest from foreign and domestic funds that have a mandate to track the PSEi and other indices that are based on PSEi different weightings of the PSEi index companies. From a shareholder perspective, inclusion in the index is probably one of the best short-term things that could happen, but making bets on BPO uptake “in the future” isn’t going to do anything for MEG shareholders now, with MEG down 17% from its February high, down 14% over the past year, down 35% over the past three years, and down 68% from its pre-COVID 2019 high.
2GO Logistics [2GO suspended] [link] said that its application to delist was approved by the PSE, and that the delisting will become effective on July 17, 2023.
MB Quick Take: As far as I know, this was the last big procedural step that the delisting application needed to go through, and even then, it was more of a rubberstamp than anything else. The July 17th date is the same as the requested date on the application.
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Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.
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