atans1

The Philippines: Its time has come finally?

In Emerging markets, Temasek on 28/04/2012 at 10:25 am

With even my dogs knowing abt the Indonesian story, while investors are getting excited about Cambodia and Burma, rightly, and rediscovering Vietnam (later abt it in the week), the Philippines has been quietly (a surprise as Filipinos tend to be excitable, boastful and noisy) getting things right.  

But some investors are aware and reaping the benefits. Last yr, the Philippines stk market was the 7th best performer (and I think tops, 2.% rise, in Asia: yup was a bad yr overall for Asian and global mkts), and so far this yr it is among the top 10 globally, up more than 20%.

The Philippines, after years of indebtedness, is a net creditor.
the country is getting its fiscal house in order. … The deficit has narrowed from a worrying 5-6 per cent a decade ago to a manageable 2 per cent …
the political situation is vastly improved. (The FT (recently) via Today.

Remember that Brazil is finally becoming the powerhouse it always had the potential to be after almost 100 yrs of disappointing investors regularly. But then Argentina has gone the other way. Bulls can only hope that Filipinos are more like Brazilians, even though they like the Argies have Spanish blood, rather than Portugese blood)

BTW, Temasek is Filipino-lite. When it was unfashionable to own shares in the Indonesia, it had major stakes in Danamon (now being sold to DBS) and BII (sold at very high valuation to sucker MayBank) and in Indosat (sold at nice profit). It doesn’t own anything direct in the Philippines: no banks, no telcos.

Local banks presence is pretty light in the Philippines when compared to Indonesia. DBS has a 21.4% stake in BPI via its 40% stake in Ayala DBS where Ayala has the majority 60% stake. UOB seems to have a 2% stake in BDO Unibank which has juz called a massive US$1bn rights issue. OCBC doesn’t seem to have a presence in the Philippines. All three local banks have subsidiaries in Indonesia.

Singtel has major investments in the Philippines (via Globe 47% which it controls together with Ayala 32%) and in Indonesia. Global is the second largest telco in the Philippines.

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