Friday, January 27, 2012

Construction, Infrastructure and Allied Services Companies - 2nd Part

As a continuation of the Part 1 blog I made previously regarding CONSTRUCTION, INFRASTRUCTURE & ALLIED SERVICES, we are going to look further on the list taken from www2.pse.com.ph. I have selected some of the paragraphs taken from www2.pse.com.ph.

MARIWASA SIAM HOLDINGS, INC.
MSCI is primarily engaged in the manufacture and sale of various quality ceramic floor and wall tiles which come in a wide array of colors, shapes, sizes and finishes. Products include vitrified floor tiles, glazed and decorated ceramic wall tiles among others.
As of December 31, 2010, MSCI has 100 distributors nationwide in which about 20% operate exclusively for MSCI. MSCI's major distributors are Cebu Oversea, Centerpoint Builders, Filco, Rai Strong, Rey Marketing, Inc., Wilcon Builders. Website is www.mariwasa.com
Kind of interesting for me but whether most PPPs will use ceramic floor and wall tiles is a question. Moving on to other companies.                   

MEGAWIDE CONSTRUCTION CORP.
I have taken a view on this company already at this blog. See MWIDE for the review I made last year. I’ll check again the prospect if I need to buy.

PHILIPPINE NATIONAL CONSTRUCTION CORPORATION
Last status it is suspended.

PHINMA CORPORATION
The Company’s operating businesses are organized and managed separately according to business activities and has five reportable operating segments as follows: Investment holdings – Property development – Steel –  Educational services – Business Process Outsourcing

Looks diversified for me. Since I am only interested in PPP related activities, I am moving on to other companies.


REPUBLIC CEMENT CORPORATION
Republic Cement Corporation (RCM) was incorporated in May 3, 1955 to primarily engage in the manufacture, development, exploitation and sale of cement, marble and all other kinds and classes of building materials, and the processing or manufacture of materials for any industrial or commercial purposes. RCM's plants are located in Bulacan, Batangas and Rizal.
We’ll take a look further.

SOUTHEAST ASIA CEMENT HOLDINGS, INC.
Southeast Asia Cement Holdings, Inc. (CMT) was established on May 3, 1994 as a holding company. In December 2003, CMT subscribed to 1,548,614,753 common shares of Republic Cement Corporation (RCM). As payment for the said subscription, CMT exchanged its 19,960,995 common shares in FR Cement Corporation (FRCC) and 10,000,000 common shares in Lloyds Richfield Industrial Corporation (LRIC). As a result, FRCC and LRIC ceased to be subsidiaries of CMT. Accordingly, RCM became an associate investee of CMT with an 26.59% interest.
Looks like it has an interest with RCM. We’ll look more closely.

SUPERCITY REALTY DEVELOPMENT CORPORATION
Supercity Realty Development Corporation (SRDC) was incorporated on June 9, 2000 to engage in the business of construction, and related services and activities. SRDC is authorized to act as a contractor or subcontractor for the construction of houses, buildings, roads, bridges and other construction projects for the private sector or the government anywhere in the Philippines.
Since the start of its commercial operations in 2000, SRDC has completed a number of land development and housing projects. The Company's major completed and ongoing projects are located in various project sites, namely, Mabuhay City Subdivision and Jubilation New Binan Subdivision in Laguna, Eastwood Greenview Subdivision, Eastwind Homes, Centella Homes Subdivision in Rizal, and Celebrity Place Walk-up Condominium in Quezon City.
In February 2008, the Board of SRDC decided to wind down the Company's construction business and re-focus its activities into real estate development. However, as of December 31, 2010, SRDC has not yet started any real development projects and thus the Company is still continuously engaged in the business of construction.
Uhum. It’s a small company and with current PPPs underway, I wonder if it will still refocus on real estate rather than construction.  We’ll see.

TKC STEEL CORPORATION
T is currently engaged in business activities that focus on the manufacture and distribution of steel products through its two subsidiaries, namely Treasure Steelworks Corporation (TSC), and Zhangzhou Stronghold Steel Works Co. Ltd (ZZS). TSC manufactures steel billets, which in turn become the raw materials of downstream steel products such as bars, wire rods and sections. ZZS manufactures various types of steel pipes and undertakes the distribution of its products in China and other export markets.
Steel and with the PPPs underway? I'll check.

VULCAN INDUSTRIAL AND MINING CORPORATION
Vulcan Industrial & Mining Corporation (VUL) was incorporated in 1953. VUL, together with its subsidiaries, are engaged in mining and mineral explorations. The Company's primary products are rock aggregates produced at Montalban.
The Company has been participating in oil exploration projects since 1976 and is part of two consortiums that have petroleum contracts.
VUL's wholly-owned subsidiary, Vulcan Materials Corporation (VM), is primarily engaged in the quarrying, crushing and marketing of rock aggregates. VUL also has investments in The Philodrill Corporation, also a listed company, which has diversified investments in oil exploration and production, property development, mining, infrastructure development and financial services.
A diversified company. We’ll see.
After browsing the CONSTRUCTION, INFRASTRUCTURE & ALLIED SERVICES listed in PSE, I have the list below in digging further.
1.    EEI CORPORATION (EEI)
2.    HOLCIM PHILIPPINES, INC. (HLCM)
3.    MEGAWIDE CONSTRUCTION CORP. (MWIDE)

4.    REPUBLIC CEMENT CORPORATION (RCM)

5.    SUPERCITY REALTY DEVELOPMENT CORPORATION (SRDC)

6.    TKC STEEL CORPORATION (T)

7.    VULCAN INDUSTRIAL AND MINING CORPORATION (VUL)

Sunday, January 22, 2012

Stock Market Strategy and Technical Analysis

I just received an e-mail from Apple Grace asking so many things about stock market. While I cannot asnwer all of the questions in one article because explaining the answers would require a lot of detailed pages and it may confuse you rather than enlightened. 
Here you go.
I came across your blog and i really hope you can help me "test the stock market waters".
 I have been working outside the country since 2007 and i just started to save a little for myself on august 2011. I have signed up with citiseconline under EIP Program. This is long term investing,right? Somehow, I understand how it works. However, I want to be "risky" and try trading but then, i am scared to begin.
Yung takot na namamayani pgdating sa pagsuong sa lugar na hindi natin kabisado ay normal lamang. Actually, karamihan sa atin ay natatakot lumabas sa ating mga comfort zone kung kayat nawawala ang oportunidad na dumarating sa atin. Kapag dumating ang oportunidad sa iyo, huwag mo nang bitiwan o pakawalan dahil hindi na ito babalik pa.
Sa stock market ganoon din ang proseso. Karamihan sa atin ay natatakot na maging risky dahil baka maubos lamang ang perang ating pinaghirapan.Kaya’t ang advise sa atin ay maging longterm investor para hindi ka na magisip pa kung bababa o tataas ang stock market. Bili ka lang ng blue chip companies then, hintayin mo na ang retirement at siguradong lalaki iyon at kasya sa iyong planong around the world travel kapag may edad ka na.
Ako naman, ang aking strategy sa stock market ay diversified strategy. Minsan, bumibili ako ng stocks kapag pababa ng pababa tulad ng nangyari sa Megaworld(MEG) last December 2011 dahil lang sa isang theory na crowded na ang property business.Well, sa ngayon balik siya sa dati at siyempre kumikita ako.(contrarian investor)
Pangalawa, binili ko rin yung Century Properties (CPG) stocks kahit bago lamang siya dahil nakabili kami ng aking asawa ng munting bahay mula sa kanila. I know how their marketing works and their property portfolios. So I bought it even though it is a very risky move on my part and that I may very well lose all my money with them. Kakalista lamang niya sa stock market last year through backdoor listing and nobody knows how it will perform in the near future since there are no financial statements yet. (Guerilla investor and taking risk).
Pangatlo, may stock ako sa FPH which is masyadong mabagal ang takbo. Ito naman yung stocks ko na mura as far as P/E ratio is concerned. Also ito yung stock ko na pangmatagalan dahil matatag ito, yung business which is energy and power is very defensive and not cyclical. Dividends are good also. (value investor).
 I will not set aside my EIP. I will trade small amounts while maintaining my EIP investments. I just do not know how it works. I do not know even how to project stocks, I do not know how to anticipate if it will fall down or plunge deeper or somehow, if it can recover.
Kung mahilig kang magbasa ng balita sa internet tungkol sa stock market, marami kang mababasa kung tataas o hindi ang stock market. Nagkalat ang mga kumpare at kumare ni Madam Auring.Maraming nanghuhula kung tataas ba o hindi ang stock market.
Technical analysis will help if a stock market will go down or up but it is not absolute.NOBODY can predict if a stock market will go down or up otherwise, siya na ang pinakamayamang tao sa Pilipinas dahil pwede siyang mangutang sa bangko, buy the stock and then sell at a profit kung sigurado siya na tataas ang stock market.
Fundamental analysis also is a guide in predicting the stock market. Macroeconomic factors like OFW remittances, consumer spending, interest rates, inflation, PPP, business environment, political settings and regulations will all affect in one way or another the stock market. Ang ating bansa maganda ang fundamentals kung kayat madaming mga foreigners ang nagiinvest sa atin. Tingnan mo ang ating stock market, it is the best perfoming stock market in the world sa taong ito. We need to give the credit where it is due.
Basically, what i understand is that, you will buy stocks then you will sell it if it goes up. Anticipation is what i do not understand. Will you help me? Also, can you suggest companies that i can buy stocks from that are not so risky? Trading is very risky while investing is not. Investing is synonymous to the adage "slowly but surely". But I wanna try trading. I hope you can help me understand the basic fundamentals of trading and how can I trade with minimal risk as a first timer.
Ok. My favorite technical analsysis that I used are MACD and RSI. Madaming technical analysis ang gamit ng mga traders pero itong dalawang ito ang kadalasang ginagamit sa pagaanalisa ng trend sa stock market. Halimbawa, yung RSI, kapag 30 or below na ito ibig sabihin, oversold na ito. Tingnan mo yung RSI chart sa baba, naging less than 30 ito kung kaya bili na ako rito tapos benta after a few days. Kapag nakita ko ito, binibili ko yung stock dahil sooner babalik din ito sa kanyang dating range. Kapag 70 or more naman ito, overbought na, kapag nakita ko ito, antabay na ako sa preso nito araw-araw. Habang tumataas pa, hindi ko muna ibebenta pero oras na bumaba ito, sell na.




Sa MACD naman, ang titingnan ko ay yung kulay blue.Kapag yung kulay blue ay pumaitaas sa kulay yellow(Minsan red yan), magandang senyales yan. Ibig sabihin antabay ka na kung tataas pa ito. Kapag yung kulay yellow naman ang pumaitaas sa kulay red na linya, medyo maging alerto ka na dahil baka bumaba na ang presyo ng stock mo.

Alam kong hindi ko nasagot lahat ng katanungan mo. Pipilitin kong ipaliwanag sa pinakasimpleng pamamaraan ang mga technical analysis sa itaas sa blog na ito. O kaya naman ay pumunta ka sa OFW Investor para sa iba pang katanungan.

Wednesday, January 18, 2012

New PSE Trading Hours


The PSE trading hours starts at 9 am to 12 nn then from 1:30 pm to 3:30 pm Philippine time. This is good news to all of us because we don't have to wake up very early just to catch up with the trading hours of PSE.

In Dubai time, it will be from 5 am to 8 am then from 9:30 am to 11:30 am. Normally, I need to wake up at 5 am just to buy or sell some shares.

Now, I can do it even during the morning coffee break in our office.

This is a big comfort to most OFWs since this was done to accomodate us more in the stock market. Slowly, OFWs are now beginning to see the potential of the stock market.

Indirectly when we invest in the stock market, we are helping our country. Talk about patriotism in a lesser form.

Also, PSE is planning to join the crossborder trading with our neighbors. This means that we can buy shares of some ASEAN countries through PSE.

Source: PhilStar

Monday, January 16, 2012

Construction, Infrastructure and Allied Services Companies - 1st Part

With the advent of the PPP this year, we will take a look with the Construction, Infrastructure and Allied Services companies that are listed in the PSE.

Manila+Skyline
http://www.flickr.com/photos/17155762@N00/1901721
Below is the list taken from www2.pse.com.ph. Some of the info were taken from the companies websites.

 AGP INDUSTRIAL CORPORATION
According to the quarterly report for period ended Sep 30, 2011 submitted to PSE, The Company has no operations since 1998 and, as shown in the accompanying financial statements, the Company continues to incur losses as the current management is assessing and identifying investment opportunities and various options regarding operations that the Company may undertake in the future.No operations.

CONCRETE AGGREGATES CORPORATION
The Company supplies the construction industry with processed aggregates, ready mix concrete, bituminous concrete mix, and pre-stressed/pre-cast concrete. Website: http://www.cac.com.ph/
Accounts                               Unaudited January to Sep 2011                      
Revenue                                11.45 million                                                       
Net Income                           6.56 million
P/E Ratio(Using Year-End-EPS)  is 72.38. Too high.                                    

EEI CORPORATION
EEI is a member of the Yuchengco Group of Companies and has been involved in the installation, construction and erection of power generating and transmission facilities, oil refineries, chemical production plants, cement plants, food and beverage manufacturing facilities, semiconductor assembly plants, road, rail and bridge infrastructures, and high rise landmarks, among others. It also operates a steel fabrication plant. Website: http://www.eei.com.ph/
Accounts                               Unaudited Jan to Sep 2011              
Consolidated Revenue       6,236,866,000                                     
Net Income                           581,529,000
P/E Ratio(Using Year-End-EPS) is 6.75. Worth digging further.                                        

FEDERAL RESOURCES INVESTMENT GROUP, INC.
Used to engage in the manufacture, marketing and distribution of various adhesives and sealants and other chemicals catering to an assortment of hardware, construction, do-it-yourself and other applications. In order to tap potential business opportunities, the Company deemed it necessary to broaden the scope of the Company's primary purpose by changing it to that of a holding company to allow for greater flexibility in its investment options.

Revenues for 2010 and 2011 consists of interest income only. Enough said. 

FORTUNE CEMENT CORPORATION
Fortune Cement Corporation (FCC) was incorporated in 1967 and is engaged in the production and sale of ordinary Portland cement and Pozzolan cement. It completed its new Line II expansion program, increasing the total production capacity by 140% to 1.8 million metric tons of clinker, or about 50 million bags of cement annually. With the exception of the province of Rizal, FCC's plant is currently the only cement plant within the Calabarzon growth corridor.The Company is registered with Board of Investment as an expanding domestic producer of cement on a preferred pioneer status. As a registered enterprise, FCC is entitled to various incentives with respect to its registered expansion project, which includes an income tax holiday for a period of four years commencing 1996.

Can't find anywhere. Perhaps it is delisted already?

HOLCIM PHILIPPINES, INC.
Holcim is one of the world's leading suppliers of cement and aggregates. It holds interests in more than 70 countries on all continents. Holcim Philippines is a member of the Holcim Group. It is involved in the manufacture, sale and distribution of cement and ready mix concrete. It is committed to managing resources responsibly and working with communities to develop sustainable options for their future. Website:http://www.holcim.com.ph/
Accounts                               Unaudited Jan to Sep 2011              
Consolidated Revenue              16,496,859,000                                  
Net Income                                 2,066,965,000 

P/E Ratio(Using Year-End-EPS) is 17.33. Too high but 2010 P/E is 26. We'll check firther 

Based on the list above, I would like to research further on EEI and HLCM.

We will see the next list on my next blog...

Friday, January 6, 2012

PPP, GDP and You


Since it is the start of the New Year, I would like to focus my research on the construction and infrastructure industry. Last year, most of the PPPs (Public Private Partnership) got delayed except for one project which was awarded to Ayala Corporation last December 2011. This year, I am expecting an explosion in the PPPs to be rolled out.

According to PPP Center, there will 154.47 billion worth of PPP projects in 2012 that will be offered to corporations. This is a good sign for our economy because it will help in creating more jobs for us. At the same time, the GDP growth rate will increase from what we had last year. According to NSCB, , the GDP growth for the first nine months of 2011 is just 3.6% only, way lower than the estimates by economists and bankers at 5% or more. However, NEDA said there is a good chance that we achieved a 4.5 to 5.5 growth in 2011 once the 4th quarter of 2011 is computed also.

I bet that the GDP growth rate this year will be more than 5%, considering the huge backlog of PPPs being rolled out this year. I do hope there will be no more delays this time.

Once these PPPs are executed, jobs will be created.

For example, the bridge in your town was destroyed by typhoon Sendong last year. Nobody can cross to the other side of the bridge because the river is swollen and the water is too deep. The government said they will erect a new bridge so that the commuters can pass by smoothly and education of the children would not be hampered.

Thus, the government announced an invitation to bid for the construction of the bridge through DPWH. Several companies made their bids to the government in the hope of getting the privilege in constructing the bridge. After a week of checking and scrutinizing the bids, the government announces the winner. The winner is Tulay Construction Company (TCC).

TCC began to mobilize its personnel upon receiving the Notice to Proceed from the government. It bought cement, sand, gravel and steels. New cranes and trucks were purchased also. The suppliers may hire new workers to keep up with the demand of TCC. These purchases made by TCC are helping the economy and pushes the GDP upwards.

TCC also began hiring additional laborers, masons, foremen, engineers and architects in support of constructing the bridge. They post the vacancies in your town hall and immediately the news came to you. So you went to the town hall to see the vacancies and upon seeing the opening for masons, your aura suddenly became bright. It sparks something in you because you know that you can do the job since you have a big, muscular body.

You applied for the job and you were hired instantly. The salary came and you now have a chance to buy your favorite Levi’s jeans which you have been dreaming of since last year. Your coworkers also bought some Levi’s jeans.

Because of PPPs, you were able to get a job and a source of income. Before, you were not able to buy a Levi’s jeans because you don’t have a job but now you can buy some stuff you can’t afford previously. Since you and your coworkers are new customers of Levis, the jeans company is now manufacturing more jeans to cater to their increasing customers. This increase in jeans production will push the GDP growth rate upwards.
Imagine how many Filipinos will be able to buy jeans if the 154.47 billion PPPs are executed this year. Perhaps, hundreds of thousand Filipinos will be able to work and buy goods and services.

How about us who invest in the stock market, how can we benefit from it? Well, it’s time to research and analyze about the construction companies bidding for these PPPs. Most likely than not, we will stumble upon a good prospect and we will buy it.