Infrastructure earnings supported by essential demand
From AB Capital's The Opening Bell: Three Moves
Event
MPIC reported 2025 core net income of P27.1 billion, up 15% YoY, supported by stronger contributions from power, water, toll roads, and healthcare. Meralco remained the largest earnings driver, accounting for nearly 70% of group operating income.
View
In our view, the results highlight the resilience of regulated and essential infrastructure businesses. Higher electricity demand, tariff adjustments in water, and recovering toll traffic supported earnings stability, while healthcare volumes continued to benefit from structural demand for private medical services.
Catalyst
Key sensitivities include regulatory tariff adjustments, power demand trends, and traffic recovery. A 5% increase in electricity sales or toll traffic could meaningfully lift earnings, while regulatory delays in tariff approvals may temper near-term revenue growth across infra segments.
Action
We remain constructive on infrastructure exposures given the stability of regulated earnings streams. GTCAP, through its stake in MPIC, offers indirect exposure to these cash-generative assets. In our view, this provides defensive earnings visibility amid macro uncertainty.
Disclaimer: The information, analyses, and views contained herein is based on sources which we, AB Capital Securities, believe are reliable, but is not guaranteed by us and is not to be considered all inclusive. It is not to be construed as an offer or solicitation of an offer to sell or buy the securities herein mentioned. AB Capital Securities and its Directors and Officers and/or members of their families may have a position in the securities herein mentioned and may make purchases and/or sales of the securities from time to time in the open-market and otherwise.
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