The local stock market is as confused as we are, with risk-averse investors staying mostly on the sidelines.
But there’s a silver lining somehow. I couldn’t help but notice how a number of listed firms, smaller ones included, are braving the uncertain environment and even planning expansions here and abroad.
DFNN Inc. subsidiary iWave Inc., for instance, will soon be expanding in Singapore with a plan to list in the prestigious Singapore Exchange. It recently acquired the listing status of a Singapore-listed company, China Sky Chemical Fibre Co. Ltd.
This makes iWave the latest addition to only three Philippine companies listed in the Singapore bourse, the others being United Industrial Corp., which is partly owned by Gokongwei’s JG Summit, Lorenzo-owned Del Monte Pacific, and First Asia Venture Capital.
An SGX listing will give the DFNN subsidiary greater access to global capital and the chance to offer its services to a wider customer base, DFNN chairman and president Ramon Garcia said in a disclosure last week.
DFNN is indeed a fast-growing company, touted as one of the fastest-growing companies in the Asia-Pacific region.
It was also recognized as a fintech company, winning the International Finance Technology Award from UK-based International Finance Publications for being the most innovative IT solutions provider for 2019.
Fruitas
Another listed company that is expanding locally despite the difficult business environment is Fruitas Holdings.
It has invested at least P1 million to build small stand-alone stores offering healthy Fruitas brands in mostly bustling communities. The move is meant to help consumers have easy access to healthy food and drinks without going through the more crowded restaurants or groceries, Fruitas president Lester Yu shared with me.
The target is to put up 10 stores in the coming weeks. So far, Fruitas has already opened three: Soy & Bean Banawe corner Retiro, Babot’s Farm in E. Rodriguez Sr. Avenue corner Cordillera, and Babot’s Farm along N. Domingo.
“The remaining seven will be opened by September,” Lester said, noting that opening 10 stores is a promise to Fruitas customers and the investing public.
Crown Asia
I also checked the weather over at Crown Asia Chemicals Corp., the Villanueva-led plastics and pipes manufacturer.
Crown Asia, you see, is one of only three listed companies which made it to Forbes 2020 list of Asia’s 200 Best Under a Billion.
I congratulated Tita Villanueva, company director, senior vice-president, CFO and the wife of Crown Asia chairman Walter Villanueva, and she said it’s really about upholding ethical values and practicing good governance.
The other two companies in the Forbes list are Asia United Bank and Vivant.
Market optimism
It’s good to hear of good news among listed companies, especially in this time of pandemic. It gives investors reasons to go back to the market.
For sure, it’s not easy for these firms, especially because expansion comes at a cost.
But it shows that they are trying to show confidence in the economy, that they are fighting on. I’m sure there are other listed firms trying to navigate the new normal the best way they can.
PSE president Ramon Monzon is, likewise, cheering every bit of good news in the market, recently rolling out the red carpet for Ayala Land’s AREIT. He hopes there will be more real estate investment trusts that will list in the exchange.
In all, the Philippine Stock Exchange Composite Index (PSEi) is trading on a three-week high since July 22 and up from 2.5-month lows since June 3.
Michael Ricafort, chief economist at Yuchengco-owned Rizal Commercial Banking Corp., said this is on the back of improved economic recovery prospects after Malacanang signaled, and eventually proceeded with the easing of the quarantine protocols in Metro Manila and nearby areas after Aug. 18 to reopen the economy.
The positive performance of the market is also driven by news about the development of the first COVID-19 vaccine by Russia, which partly supported the recent gains in US stock markets to 5.5-month highs since late February or before the COVID-19 lockdowns, as well as the gains in other stock markets around the world.
Listed firms, although struggling, are still better off than some MSMEs which are no longer earning because of the difficult business environment. The government needs their help and I hope that with the ratification of Bayanihan 2, the vulnerable sectors would finally get the support they need.
Companies are fighting on, but they need all the help they can get.
Iris Gonzales’ email address is eyesgonzales@gmail.com. Follow her on Twitter @eyesgonzales. Column archives at eyesgonzales.com