WILL THEY RECOVER?

Fitch Solutions flags ‘high regulatory risk’

“Overall, we expect investor confidence to take a hit in the short term, but to gradually improve over the long term, as the Philippines continues to improve on frameworks for public-private partnerships (PPPs).”

The report comes after the Metropolitan Waterworks and Sewerage System (MWSS) tried to ease speculations on the fate of the two companies by saying that their contracts remain valid and subsisting.

Share prices of listed companies concerned recovered on Monday, but were still below levels on Dec. 3, when President Rodrigo R. Duterte railed against the concessionaires over what he described as onerous provisions in their deals with the government. Manila Water shares climbed 15.19% to end P8.57 apiece, though still about half their P16.90 finish on Dec. 3, while those of Metro Pacific Investments Corp. (which owns more than half of Maynilad) rose 4.91% to P3.42, still 22.1% below P4.39 on Dec. 3 and DMCI Holdings, Inc. edged up 0.31% to P6.40 each, 1.54% lower than its P6.50 closing price on Dec. 3. READ MORE

TECHNICAL CHARTS

CO-RELATION
ALL THREE WILL CONVERGE
PESI & MWC
MWC SHOULD RECOVER
PSEI
PSEI WILL CHALLENGE MA200

KEY TAKEAWAYS

  • MWC, MPI & DMC are poised to recover
  • There will re-negotiation of the contract and we are sure that there will be common ground for better Philippines
  • All these 3 companies have solid fundamental and corporate governance
  • Buy cautiously in stages

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