FRI 13 APR 2018

Notable Movers:

Shares of RRHI fell following news that the Rustan’s trademark is not included in
RRHI (-5.56%)
the acquisition

(AS OF APR 12, 2018)

Top Stories for the Week:
INDICES
Close Points W/W YTD %
COLing the Shots: Are we in a bear market? PSEi 7,899.98 -45.68 -0.58 15.49

If I own stocks, should I still sell now? All Shares

Financials
4,794.65 -33.85
2,028.63 4.22
-0.71
0.21
15.36
22.54
Holding Firms 7,908.83 -78.79 -1.00 13.11
The market continues to weaken and is now down by 12.3% from the peak and 7.2% for the Industrial 11,256.58 100.10 0.89 5.69
year to date period. However, we continue to believe that we are just suffering from a major Mining & Oil 11,168.81 -138.34 -1.24 -5.81
correction and not a bear market because only two things have changed domestically compared Property 3,604.93 -39.57 -1.10 17.56
to the start of the year: Higher than expected inflation and a substantially weaker peso. However, Services 1,635.66 -24.77 -1.51 25.54
higher inflation and the weaker peso are not enough to cause a bear market.

Although nobody knows where the bottom of this correction will be and how quickly the market
will recover, investors who bought stocks too early should not worry and just hold on. Based INDEX GAINERS
on our analysis of the past 10 major corrections, an investor who bought the market when the Ticker Company Price W/W
index was down 13% from the peak would have generated a median return of 11.9% six months
JFC Jollibee Foods Corp 292.20 5.11
forward and 20.2% 12 months forward. He would not have been able to participate in three out
of the past 10 corrections, but in the seven corrections that he was able to participate in, he AC Ayala Corporation 956.00 4.03
would have generated a positive return six out of seven times based on a six-month investment AGI Alliance Global Inc 14.18 3.81
time horizon and seven out of seven times based on a 12-month investment time horizon. MEG Megaworld Corporation 4.65 2.88
BDO BDO Unibank Inc 138.30 2.75
In fact, investors who are looking to buy this correction can already start accumulating at these
levels since 1.) the return outlook six to 12 months going forward is already positive; 2.) on
average, the market bottomed three months from the peak. Since we peaked in January 29,
the market could bottom sometime end of April; and 3.) by being early, an investor is in a better INDEX LOSERS
position to fully invest his portfolio. Ticker Company Price W/W
RRHI Robinsons Retail Hldgs Inc 84.9 -5.56

PIZZA: Full year core income up 13.9% to MPI Metro Pacific Inv Corp 4.93 -5.19

Php762 Mil as expected

LTG LT Group Inc 18.7 -5.08
SM SM Investments Corp 940 -3.69
SCC Semirara Mining 31.4 -2.94

Full year recurring profits up 13.9% y/y to Php762 Mil. PIZZA’s fourth quarter performance
brought its full year recurring net income to Php762 Mil, up 13.9% from 2016’s recurring net
income of Php669 Mil. This is in line with COL (101.7% of full year forecast) and consensus (99.0% TOP 5 MOST ACTIVE STOCKS
of full-year) forecasts. Earnings growth was driven by a robust 17.8% y/y increase in revenues to
Php7.0 Bil. Recurring operating expenses increased by a slower pace of 9% y/y to Php905 Mil, Ticker Company Turnover
resulting to a steady recurring operating profit margin (OPM) of 19.1%. This allowed recurring ALI Ayala Land Inc 457,172,250
operating income to rise by 14.2% y/y to Php1.2 Bil. AC Ayala Corporation 369,963,200
BDO BDO Unibank Inc 332,076,925
Growth story continues. PIZZA’s growth story remains intact as the company looks favorably SM SM Investments Corp 314,598,900
into 2018. This year, key initiatives include value-enhancing promotions and product innovations, JFC Jollibee Foods Corp 263,327,538
continuous improvement in store aesthetics and atmosphere to elevate dine-in experience,
and improving its delivery segment. PIZZA is now ramping up the improvement of its delivery
infrastructure and systems and it expects the contribution of its delivery segment to gather
momentum by the second half of this year.

With these initiatives, PIZZA aims to grow its 2018 revenues in the low double-digit level, driven
by SSSG of 3% to 5%. It also plans to open 20 new stores this year. This is in line with our forecast
as we expect PIZZA to grow revenues by 13.6% this year to Php8.0 Bil. PIZZA also aims to maintain
its margins in 2017. Although it cites near term pressures from cost inflation of around 1% to 2%,
it already raised selling prices in March by 3%.
Disclaimer: All content provided in COL Reports are meant to be read in the COL Financial website. Accuracy and completeness of content cannot be guaranteed if reports are viewed outside of
the COL Financial website as these may be subject to tampering or unauthorized alterations.
 WEEKLY NOTES I PHILIPPINE EQUITY RESEARCH

FRI 13 APR 2018

Other Stories:

Banking Sector: Earnings rise on healthy growth in recurring income

MEG: FY17 core income ahead of estimates
IMI: IMI sets up JV with Toppan Printing Co., Ltd.
MRSGI: 4Q profits lackluster due to weak sales and higher opex
BLOOM: Prepares for land acquisition
MWIDE: 4Q17 profits up 71.3% y/y, above management guidance and consensus estimates

Market Summary:

The PSEi declined during the week. The benchmark index lost 45.68 points or -0.58% to close at
7899.98. Value turnover decreased to Php26.2 from Php31.0Bil the previous week. Foreigners
continued to be net sellers throughout the week, liquidating Php1.8Bil worth of shares

Summary of Changes in Shareholdings:

Date of Acquired or Price per
Stock Volume Person (Designation)
Disclosure Disposed share
3,200 16.00
Edward K. Lee
6-Apr COL 12,600 A 16.10
(Chairman of the Board)
17,700 16.14
Manuel V. Pangilinan
10-Apr MPI 200,000 A 5.38
(Regular Director)
10,000 229.40 Belen C. Lim
10-Apr SECB A
300 229.60 (Executive Vice President)
Edward K. Lee
11-Apr COL 13,100 A 16.16
(Chairman of the Board)
So urce: P SE

COL Financial Group, Inc. 2

 CALENDAR OF EVENTS

APRIL
WEEKLY NOTES I PHILIPPINE EQUITY RESEARCH

FRI 13 APR 2018

SUN MON TUE WED THU FRI SAT

1 2 3 4 5 6 7

8 9 10 11 12 13 14

15 16 17 18 19 20 21

22 23 24 25 26 27 28

29 30 27 28 29 30 31

1 31 6 7 8 9 10

K E Y E V ENTS HOL IDAY

A PR 1 APR 12 F L I : A N N UA L S H A R E H O L DER S MEE TING

HOLI DAY: H OLY WEE K
A PR 3
SMC: EX-DATE PH P0.35 C A S H D IV IDEND
ALCO: E X-DATE PH P0.01 2 C A S H D IV IDEND
LFM: EX-DATE PH P0.50 C A S H DIV IDEND
A PR 4
DD: EX- DATE PH P1.62 C A S H DIV IDEND
H2O: A NNUAL SH ARE H OLDER S M EE T ING
A PR 5
2 G O: ANN UAL SH ARE H O LD ER S M EE T ING
A PR 6
CR OWN: E X-DATE PH P0.04 C A S H DIV IDEND
A PR 9
HOLI DAY: TH E DAY OF VA LO R
A PR 1 0
MRSGI : EX-DATE PH P0.06 C A S H DIV IDEND
T EL: EX-DATE PH P28.00 C A S H D IV IDEND
SECB : E X-DATE PH P1.50 C A S H DIV IDEND
CHI : ANNUAL SH ARE H O LD ER S M EE T ING
CPV: ANNUAL SH ARE H O LD ER S M EE T ING
A PR 1 1
PHEN: A N NUAL SH ARE HO LD ER S M EE T ING
R OX : AN NUAL SH ARE H OLDER S M EE T ING
R CI : ANNUAL SH ARE H OLDER S M EE T ING
P O P I: A N N UA L SH A R E H O L D E R S M E E T I N G
P P G: A N N UA L S H A R E H O L D E R S M E E T I N G
APR 13
IM I: A NN UA L S H A R E H O L D E R S M E E T I N G
BLF I: A N N UA L S H A R E H O L D E R S M E E T I N G
CO L: A N N UA L SH A R E H O L D E R S M E E T I N G
APR 16
IP O : EX- DAT E P H P 0 . 0 6 C A SH D I V I D E N D
M W C : A N N UA L SH A R E H O L D E R S M E E T I N G
LC : A NN UA L S H A R E H O L D E R S M E E T I N G
APR 17
GLO : A N N UA L S H A R E H O L D E R S M E E T I N G
MA : A NN UA L S H A R E H O L D E R S M E E T I N G
APR 18
F F I: EX- DAT E P H P 0 . 0 8 C A SH D I V I D E N D
A LI: A NN UA L SH A R E H O L D E R S M E E T I N G
A NS : A N N UA L S H A R E H O L D E R S M E E T I N G
APR 19
BP I: A NN UA L S H A R E H O L D E R S M E E T I N G
IC T: A NN UA L S H A R E H O L D E R S M E E T I N G
A BS : A N N UA L S H A R E H O L D E R S M E E T I N G
P HN: A N N UA L SH A R E H O L D E R S M E E T I N G
APR 20
BHI: A NN UA L SH A R E H O L D E R S M E E T I N G
AC : A NN UA L S H A R E H O L D E R S M E E T I N G
E W: A N N UA L SH A R E H O L DER S MEE TING
B D O : A N N UA L S H A R E H O LD ER S MEE TING
SS P: A N N UA L SH A R E H O LD ER S MEE TING
A PR 23
BEL: A N N UA L SH A R E H O LD ER S MEE TING
PS B : A N N UA L S H A R E H O LD ER S MEE TING
PLC : A N N UA L S H A R E H O LD ER S MEE TING
A PR 2 4
PN B : A N N UA L SH A R E H O LD ER S MEE TING
J F C : A N N UA L SH A R E H O LD ER S MEE TING
SM PH : A N N UA L S H A R E H OL D ER S MEE TING
SE C B : A N N UA L SH A R E H OL D ER S MEE TING
A PR 2 5
M BT: A N N UA L S H A R E H O LD ER S MEE TING
SM : A N N UA L S H A R E H O L DER S MEE TING
A PR 2 6
AT: A N N UA L S H A R E H O L DER S MEE TING
M V C : A N N UA L S H A R E H OL D ER S MEE TING
AT I : A N N UA L SH A R E H O L DER S MEE TING
A PR 2 7
R E G : A N N UA L S H A R E H O LD ER S MEE TING
B M M : A N N UA L SH A R E H OL D ER S MEE TING

COL Financial Group, Inc. 3

 WEEKLY NOTES I PHILIPPINE EQUITY RESEARCH

FRI 13 APR 2018

IMPORTANT RATING DEFINITIONS

BUY
Stocks that have a BUY rating have attractive fundamentals and valuations based on our analysis. We expect the share price to outperform the market in the next six to
12 months.

HOLD
Stocks that have a HOLD rating have either 1) attractive fundamentals but expensive valuations 2) attractive valuations but near-term earnings outlook might be poor
or vulnerable to numerous risks. Given the said factors, the share price of the stock may perform merely in line or underperform in the market in the next six to twelve
months.

SELL
We dislike both the valuations and fundamentals of stocks with a SELL rating. We expect the share price to underperform in the next six to12 months.

IMPORTANT DISCLAIMER
Securities recommended, offered or sold by COL Financial Group, Inc. are subject to investment risks, including the possible loss of the principal amount invested.
Although information has been obtained from and is based upon sources we believe to be reliable, we do not guarantee its accuracy and said information may be
incomplete or condensed. All opinions and estimates constitute the judgment of COL’s Equity Research Department as of the date of the report and are subject to change
without prior notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of a security. COL Financial and/
or its employees not involved in the preparation of this report may have investments in securities of derivatives of the companies mentioned in this report and may trade
them in ways different from those discussed in this report.

COL RESEARCH TEAM

APRIL LYNN TAN, CFA

VP & HEAD OF RESEARCH
april.tan@colfinancial.com

CHARLES WILLIAM ANG, CFA GEORGE CHING RICHARD LAÑEDA, CFA

DEPUTY HEAD OF RESEARCH SENIOR RESEARCH MANAGER SENIOR RESEARCH MANAGER
charles.ang@colfinancial.com george.ching@colfinancial.com richard.laneda@colfinancial.com

FRANCES ROLFA NICOLAS ANDY DELA CRUZ JUSTIN RICHMOND CHENG

RESEARCH ANALYST RESEARCH ANALYST RESEARCH ANALYST
rolfa.nicolas@colfinancial.com andy.delacruz@colfinancial.com justin.cheng@colfinancial.com

JOHN MARTIN LUCIANO ADRIAN ALEXANDER YU

RESEARCH ANALYST RESEARCH ANALYST
john.luciano@colfinancial.com adrian.yu@colfinancial.com

COL FINANCIAL GROUP, INC.

2402-D EAST TOWER, PHILIPPINE STOCK EXCHANGE CENTRE,
EXCHANGE ROAD, ORTIGAS CENTER, PASIG CITY
PHILIPPINES 1605
TEL NO. +632 636-5411
FAX NO. +632 635-4632
WEBSITE: www.colfinancial.com

COL Financial Group, Inc. 4