Investors lukewarm on PLDT-Softbank venture

PLDT
INTERAKSYON.COM

By Jobo E. Hernandez, Researcher

THE recent partnership between a Japanese telecommunications provider and a unit of PLDT, Inc. made the listed telecommunications firm one of the most actively traded stocks last week.

Data from the Philippine Stock Exchange showed a total of P1.35 billion worth of 995,405 PLDT shares being traded from Dec. 14 to 18, making it the eighth most actively traded stock last week.

Shares in the Pangilinan-led company closed on Friday at P1,371 apiece, up 2.7% from the previous week’s P1,335. Year to date, the stock gained 37.9%.

“There’s been a lot of news regarding the Philippine telco scene recently, which puts not only [PLDT], but also other listed telcos, in the limelight. With PLDT’s consistent updates regarding its successful network expansions, people have been actively trading the stock [last] week — positively at first, and then sellers came out to take profits mid-week,” Regina Capital Development Corp. Equity Analyst Anna Correne M. Agravio said in an e-mail.

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Under its partnership with Japanese firm Softbank Corp., PLDT Global Corp. will offer SmartInternet Suite Ether to small, medium, and large enterprise clients in Japan, PLDT said in an e-mailed statement over the weekend of last week. According to PLDT Global, SmartInternet Suite Ether helps businesses address their needs “for a higher-grade internet environment that suits diverse work styles and evolving business areas.”

Moreover, PLDT also announced it was ready to invest between P88 billion and P92 billion next year to meet the requirements of its mobile and fixed-line customers. It expects its capital expenditures to hit at least P70 billion this year.

Ms. Agravio said these developments had a “net positive impact” on PLDT’s share price.

“The successful sale of Smart Tower provides PLDT with more liquidity to fulfill its aggressive expansion plans in line with further boosting network capacity in the years to come,” Ms. Agravio said.

In a Viber message, Timson Securities, Inc. Head of Online Trading and Trader Darren Blaine T. Pangan said some market participants “may have chosen to stay on the sidelines” as they wait for the government to assess the improvement of services provided by telecommunication companies “as President Rodrigo R. Duterte’s December deadline looms.”

To recall, Mr. Duterte took a swipe at these firms in his State of the Nation Address last July and gave them until the end of the year to improve services.

PLDT’s attributable net income in the third quarter rose 114.5% year on year to P7.64 billion, amid the rise in demand for digital or online services due to the pandemic. Year to date, attributable net income to equity holder of PLDT reached P18.89 billion, up 29% from last year’s comparable three quarters.

Regina Capital’s Ms. Agravio placed the stock’s support and resistance at P1,320 and P1,380, respectively.

For Timson Securities’ Mr. Pangan: “The stock has been consolidating for the past few months, with nearest support at P1,300, and immediate resistance at P1,430.”

“We’ll have to see in the remaining days of the year, if it continues to consolidate. Otherwise, breaking either the nearest support or resistance may change its sideways movement,” he said.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls.

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