Quick Take: Upson's STAB fund and 3 more market updates
Upson International [UPSON 2.41 1.6%; 9% avgVol] [link] reported using 1,517,000 shares of its Stabilization Fund on its IPO day, which was one week ago. The total Stabilization Fund is 62,500,000 shares in size, and it hasn’t traded below its IPO offer price of P2.40/share since the first few hours of its IPO day, so it’s highly likely that the fund still has around 97.5% of its quota remaining.
MB Quick Take: UPSON was a feel-good story, but we’ll have to wait to see if the shortened weeks (and trading vacations) associated with Holy Week will help or hurt UPSON once things get back to normal. Judging by the number of out-of-office replies I received yesterday from professional traders, I think it’s too early to say what might happen here. UPSON’s rise was really unexpected given the low interest in the stock from the retail crowd, and while a strong performance attracted some of that attention from retail organically, that’s not the kind of attention that tends to stick around when the numbers turn red. We’ll have to wait.
Philippine Telegraph and Telephone Corporation [PTT suspended] [link] disclosed that the deal for MRC Allied [MRC 0.22 0.5%; 44% avgVol] to acquire 500 million shares of PTT for P1.00/share has “yet to finalize several terms” that are “material in nature”, with MRC going so far as to say that the original 60-day closing period that was announced 41 days ago would be “moved to another date to be agreed upon” by the parties.
MB Quick Take: PTT has been suspended for longer than some MB readers have been alive, and all the same questions about this transaction are still in play. Namely, it’s unclear why MRC needs to buy shares of PTT from Menlo Capital to allow it to use PTT’s facilities. That sounds like something that would be better solved (from the perspective of MRC shareholders) by some kind of agreement between MRC and PTT. It hasn’t been explained why transferring P500 million to a related party that isn’t PTT would help MRC in a way that a service agreement wouldn’t.
Alternergy [ALTER 1.26 2.4%; 23% avgVol] [link] reported using 13.025 million shares of its Stabilization Fund last week, bringing the cumulative total up to around 60 million shares of its 115 million quota. The Stabilization Fund is 52% depleted.
MB Quick Take: This one has been heavy from the start, but its depletion is not out of line with where the price is or how far along we are in the month-long mandate that the fund has to operate. I expect the fund to continue providing as much support as it has to this point.
SM Investments [SM 899.00 0.3%; 121% avgVol] [link] reveals a possible plan to offer logistics consolidation service to provincial MSMEs. This would allow small businesses to drop items off at the SM consolidation points, where SM logistics companies could then pick up and transport into Metro Manila on a regular schedule. The article mentioned that two of SM’s component logistics companies, 2GO Logistics [2GO 14.38 0.3%; 8% avgVol] and Airspeed, could be involved, but SM didn’t appear to elaborate on whether this consolidation service would flow through its existing logistics interests or not.
MB Quick Take: Someone forwarded this to me because I’m crazy for logistics, and while I think that this consolidation effort does address a pain-point for remote businesses (cost-effective logistics to NCR), from what I’m seeing, it doesn’t sound much more than SM trying to reduce the input costs of its goods that are sources from outside Metro Manila. I suppose it could provide SM with additional business intelligence, but with domestic trucking margins as thin as they are, I don’t see it as being much more than that. I hope that I’m wrong, though! I’ll still be watching.
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Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.
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