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Daily Edge Summary - 20 February 2014

Core Content

This document is a financial report dated 20 February 2014, providing insights into stock performance, analyst recommendations, and key financial metrics for various companies in the Philippine market. It includes data on the PSEi index, stock turnover, and specific stocks such as PLDT ADR, as well as detailed financial forecasts and valuations for several stocks, particularly those related to Lopez Holdings Corp (LPZ) and its affiliates.

Main Points

PSEi and Market Activity

• PSEi: Closed at 6,294.62, with a 1.62% increase.
• Turnover: Reached 8,798.98 PHPm, up by 45.59%.
• PLDT ADR (USD): Closed at 59.83, with a 0.27% increase.
• PLDT ADR (PHP): Closed at 2,658.25, with a 0.27% increase.
• Ave interbank rate: 2.00%, with no change.
• PHP/USD rate: 44.63, down by 0.18%.

Analysts

• The report is authored by Maybank ATR Kim Eng analysts, including Luz Lorenzo, Laura Dy-Liacco, Rommel Rodrigo, Lovell Sarreal, Katherine Tan, and Ramon Adviento.

Key Stock Analysis

Lopez Holdings Corp (LPZ)

• Current Price: PHP4.40
• Target Price: PHP8.25 (revised from PHP8.78)
• Upside Potential: 87.5%
• Analyst View: Reiterate BUY recommendation, with revised target price due to lower earnings forecasts and adjustments for its 53% owned affiliate, ABS-CBN Broadcasting Corp (ABS/ABSP).
• Earnings Adjustments:
  • 2014F: Adjusted net income to common is PHP1,487m (down 6% from previous estimate).
  • 2015F: Adjusted net income to common is PHP3,029m (down 5% from previous estimate).
• Performance Highlights:
  • EDC (Energy Development Corp) has restored 73% of the Leyte power plants damaged by Typhoon Haiyan.
  • Unit 1 of EDC's BacMan plant was re-commissioned on 30 Jan 2014.
  • If additional capacity comes online, LPZ's earnings could reach PHP3b in 2015.

Other Stocks

Banks

• MBT: Redeeming PHP4.5b Tier 2 notes on 6 May 2014, which will reduce interest costs by about PHP225m.
• BDO: Entering a business tie-up with Joyo Bank, Japan, to support SMEs in the Philippines.
• BPI, CHIB, EW, BDO, PNB, CHIB, CHIB, RFM, URC, PF, DMPL, RRHI, CIC:
  • Each has a target price, upside potential, and analyst recommendation (BUY or HOLD).
  • Key metrics include EPS growth, PER, DPS, Yield, and Net Gearing.

Telcos

• PLDT: Current price is PHP2,700, with a target price of PHP3,090 (14% upside).
• GLO: Current price is PHP1,778, with a target price of PHP1,582 (11% downside).
• Telcos Sector: Overall target price and performance metrics are provided.

Utilities

• EDC: Current price is PHP5.44, with a target price of PHP5.73 (5% upside).
• FGEN: Current price is PHP16.82, with a target price of PHP17.00 (1% upside).

Summary Table

Additional Information

• The document also includes a NAV estimate for LPZ, showing the revised and previous values.
• The earnings and valuations table provides a detailed comparison of key financial metrics for multiple stocks across different sectors.
• The week ahead includes several key events, such as the Annual Stockholders' Meeting for several companies.

This report is sourced from Bloomberg and Maybank ATR Kim Eng estimates, with updates and analysis provided by the analysts listed.