12 January 2024

Stories for the Day Watchlist

• CNVRG and DITO unit sign master facilities provisioning agreement 11-Jan CHG (%)
• MEG to build second hotel in Palawan PSEi 6,613.73 1.03%
• ICT submits bid for management of Iloilo Commercial Port Complex DJIA 37,711.02 0.04%
S&P 500 4,780.24 -0.07%
Stock Feature: MWC NASDAQ 14,970.18 0.00%
We reiterate our BUY recommendation on MWC with a PT of Php28/shr implying 49% USDPHP 55.979 0.52%
upside. We are upbeat on the company as we believe that: a) MWC will benefit from the Source: PSE, BSP
underpenetrated water value chain in the Philippines as it replicates its success in its core
East Zone concession, and b) its technical know-how and operational experience across the
entire water services value chain could allow MWC to obtain new legs of growth outside the
Index Movers
Philippines. Earnings growth should be supported by: 1) robust average tariff growth of
Gainers Losers
33%/12%/8% in FY23F/24F/25F supported by tariff adjustments implemented in the East
Zone business (28%/16%/10% hike effective FY23F/24F/25F, East Zone accounts for 95% of JFC 3.92% JGS -1.71%
MWC’s profits in FY22A), and 2) stable billed volume CAGR of 4% in FY23-25F. We think the BPI 3.82% WLCON -1.68%
market continues to overlook MWC’s tariff wins in the East Zone, which underpins our BDO 3.48% ICT -1.08%
forecasted FY23-25F EPS CAGR of 10%, and the improved regulatory backdrop. MWC also SMC 2.61% ALI -0.58%
trades below book (0.6x FY24F P/B) and at a 38% discount to its historical P/E (FY24F P/E of
DMC 2.13% TEL -0.54%
5.4x vs. 5-year average of 8.7x).
Source: PSE

Daily Trading Highlights

PH stocks bounced back yesterday as bargain hunters bought into positions ahead of the
US CPI release due Thursday. The PSEi regained most of what it lost the previous session
with most gauges finishing in positive territory. The PH index recovered after the prior
session's sell-off and stayed above its ascending 20-D MA (6,500). However, the market
remained below its 6-month resistance high (6,700).

BPI TRADE TOP PICKS (TOP BUY RECOMMENDATIONS)

Short-Term
12 Month
STOCK Technical 3 MO
LAST PRICE % Upside REASONS
PICK Perf (%)
Price Target Entry Exit

Growth play with core businesses benefitting from improving

AC 674.00 870.00 29.1% 600.00 682.00 9.5%
macro conditions and structural trends
Rate reversal play assuming rate cuts happen by 2Q24, trades
ALI 34.25 38.50 12.4% 26.50 33.00 19.5%
at a steep discount to NAV
Decent dividend yields supported by healthy occupancy rates,
AREIT 33.50 42.00 25.4% 29.00 33.70 1.5%
pipeline of potential acquisitions provide growth headroom
Strong proxy for PH economy with its core businesses that are
SM 890.00 1,080.00 21.3% 800.00 890.00 7.5%
market leaders in their respective sectors
Resumption of F2F classes to spur demand for its products,
URC 121.50 158.00 30.0% 95.00 119.00 5.7%
moderating input costs should also prop up margins

*Entry and Exit Prices are based on the recommendations of BPI Securities Active Advisory Group
*Ratings and Price Targets are based on the recommendations of BPI Securities Research Department

This is a product of the BPITrade Sales & BPITrade Research Team. See appendices for analyst certification and important disclosures.

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TRADERS’ TAKEDOWN

BPI Securities Valuation Table

FY24F
TARGET LAST % UPSIDE / FY24F FY24F FY24F Div FY24F
TICKER RATING EPS
PRICE PRICE (DOWNSIDE) P/E P/B Yield (%) ROE (%)
Growth
AC BUY 870.00 674.00 29.1% 9.3 0.9 1.0% 10.7% 14.3%
ACEN BUY 6.50 4.31 50.8% 14.6 1.1 0.6% 8.7% 89.5%
ALI BUY 38.50 34.25 12.4% 18.1 1.6 1.2% 7.8% 13.7%
AP BUY 46.50 38.30 21.4% 8.4 1.3 5.9% 16.5% 0.6%
AREIT BUY 42.00 33.50 25.4% 13.4 1.0 6.9% 7.0% 6.7%
BDO BUY 163.00 139.80 16.6% 9.7 1.3 2.1% 14.0% 7.4%
CNPF BUY 29.50 33.60 -12.2% 18.2 3.1 1.2% 18.2% 11.8%
DNL BUY 9.00 6.56 37.2% 10.3 1.8 3.7% 18.7% 32.8%
FB BUY 75.00 50.00 50.0% 10.7 2.2 7.9% 22.2% 12.4%
FILRT BUY 3.80 2.99 27.1% 13.1 3.1 9.6% 22.9% 4.7%
GTCAP BUY 840.00 613.00 37.0% 4.7 0.5 0.5% 11.6% 7.6%
ICT BUY 250.00 238.40 4.9% 13.3 5.2 4.4% 39.0% 4.6%
JFC BUY 274.00 259.80 5.5% 34.9 3.0 1.2% 9.0% 13.6%
MBT BUY 59.00 56.00 5.4% 6.7 0.6 2.9% 10.0% 10.9%
MER BUY 425.00 380.00 11.8% 11.8 3.2 6.2% 27.9% -3.2%
MONDE BUY 9.50 8.63 10.1% 18.5 2.7 1.4% 15.8% 22.1%
MWC BUY 28.00 18.80 48.9% 5.4 0.6 5.6% 11.8% 13.9%
PGOLD BUY 38.00 28.50 33.3% 8.0 0.8 3.5% 11.0% 6.3%
RCR BUY 6.90 5.10 35.3% 12.1 1.0 8.1% 8.0% 3.4%
SCC HOLD 28.50 31.00 -8.1% 7.0 2.1 16.9% 29.8% -37.9%
SM BUY 1080.00 890.00 21.3% 13.2 1.7 1.3% 13.9% 10.2%
SMPH BUY 40.00 33.50 19.4% 21.2 2.2 0.5% 10.3% 12.1%
URC BUY 158.00 121.50 30.0% 17.8 2.1 3.6% 11.8% 18.3%
WLCON HOLD 21.50 23.45 -8.3% 25.1 3.8 1.3% 15.1% 4.2%
Source: PSE, BSP
Rating System: Buy (>10% Upside); Hold (-10% Downside to +10% Upside); Sell (>10% Downside)

This is a product of the BPITrade Sales & BPITrade Research Team. See appendices for analyst certification and important disclosures.

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TRADERS’ TAKEDOWN

Macro & Corporate News

CNVRG and DITO unit sign master facilities provisioning agreement
Converge ICT Solutions Inc. (CNVRG) and DITO Telecommunity Corp., subsidiary of DITO CME Holdings Corp. (DITO), announced the
signing of a landmark Master Facilities Provisioning Agreement (MFPA) that will allow the two companies to share select terrestrial
and submarine fiber optic cable assets under terms and conditions to be mutually agreed upon by CNVRG and DITO. This resource
exchange arrangement will strengthen the network of both operators as it translates to expanded coverage and increased
redundancy, leading to an improved user experience for their respective customers through lower downtime, faster throughput,
and more reliable connectivity. At the same time, it will create savings from increased operational efficiencies and reduced capital
expenditure requirements. “We want to leverage our respective existing facilities through this resource sharing agreement to bring
us closer to our goal of empowering every Filipino home with quality broadband connectivity. Our collaboration will allow us to reach
more customers and deliver a better service with increased resiliency,” CNVRG Chief Executive Officer (CEO) and Co-Founder Dennis
Uy said. CNVRG Chief Operations Officer (COO) Jesus Romero noted that the agreement propels both networks as the robust state-
of-the-art pure fiber network of CNVRG matches DITO’s brand new network. “This agreement strengthens both our networks and
eliminates the costly time, motion, financial, and manpower resources involved for such a network enhancement undertaking,” DITO
Telecommunity Chief Technology Officer Rodolfo Santiago added.

MEG to build second hotel in Palawan

Megaworld (MEG) is building the Paragua Sands Hotel, its second hotel development inside its 462-hectare Paragua Coastown
ecotourism township in San Vicente, Palawan. The hotel will have 313 rooms, featuring views of the Pagdanan Bay and nearby
mountains. “We are very excited to introduce our 20th hotel property in our portfolio, and what better destination to host it than in
San Vicente, Palawan, which is home to the longest beachline in the country and the second longest in the entire Southeast Asia,”
says Cleofe Albiso, Managing Director of MEG Hotels and Resorts. The Paragua Sands Hotel will be just a five-minute walk to both
the beach and the mangrove reserve park, which will form part of the sprawling township. It will also sit right beside Savoy Hotel
Palawan and Oceanfront Premier Residences, the first hotel and residential condominium developments rising inside the township
respectively, whilst being surrounded by lots of the soon-to-rise Mercato Shophouse District nearby. The Paragua Sands Hotel will
feature a variety of facilities, including its own swimming pool, food and beverage outlets, a 220-person capacity ballroom, function
rooms, a business center, and an outdoor deck and balconies to name a few. The Paragua Sands Hotel is scheduled for opening in
2029 and upon completion, it will be managed and operated by Megaworld Hotels & Resorts.

ICT submits bid for management of Iloilo Commercial Port Complex

International Container Terminal Services, Inc. (ICT) had submitted a bid to maintain and manage the Iloilo Commercial Port
Complex (ICPC). The 25-year concession agreement, as per the Philippine Ports Authority’s (PPA) bid invitation, sets a minimum
fixed fee of Php500M for the 6th to 10th year and a minimum annual concession fee of Php100M for the sixth year. The PPA has
scheduled the deadline for bid submission and bid opening on 11 January. “Bids evaluation for ICPC is still undergoing. [PPA] will
issue a statement after bid evaluation is completed,” a PPA representative said. The PPA stated that the winning bidder must have
at least two years of experience in providing port terminal management services, cargo handling services, and other related port
services. Additionally, they expect the bidder to possess experience in operating a terminal similar or larger than ICPC and should
have a minimum of 10 years of relevant experience in handling foreign containerized and non-containerized cargo. The winning
bidder must also have an experience in similar rehabilitation and construction works, the PPA added. Last year, the Transportation
department said the PPA had received several proposals for the Iloilo port, but it noted that only one party is serious about the
project. In 2022, ICT had already announced plans to revive its proposal to develop and operate the ICPC. They had earlier estimated
the required investment to be more than Php5B.

This is a product of the BPITrade Sales & BPITrade Research Team. See appendices for analyst certification and important disclosures.

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TRADERS’ TAKEDOWN

Dividends Schedule

Type of Ex-Dividend Payment

Ticker Company Name Dividend Rate
Dividend Date Date

DDMPR DDMP REIT, Inc. Cash PhP 0.0256820 1/19/2024 2/14/2024

Megawide Construction
MWP4 Cash PhP1.325 1/19/2024 1/29/2024
Corporation
Php1.375 per share per quarter
8990B 8990 Holdings, Inc. Cash (Equivalent to a rate of 5.50% per 1/26/2024 2/10/2024
annum)

PRF3A Petron Corporation Cash P17.17825 2/29/2024 3/25/2024

PRF3B Petron Corporation Cash P17.84575 2/29/2024 3/25/2024

PRF4A Petron Corporation Cash P16.76975 3/12/2024 4/8/2024

PRF4B Petron Corporation Cash P16.99300 3/12/2024 4/8/2024

PRF4C Petron Corporation Cash P17.71525 3/12/2024 4/8/2024

GTPPB GT Capital Holdings, Inc. Cash Php12.73725 4/4/2024 4/29/2024

GTPPB GT Capital Holdings, Inc. Cash Php12.73725 7/4/2024 7/29/2024

GTPPB GT Capital Holdings, Inc. Cash Php12.73725 10/4/2024 10/28/2024

Appendix | General Disclaimer

This is a product of the BPITrade Sales & BPITrade Research Team. See appendices for analyst certification and important disclosures.

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TRADERS’ TAKEDOWN

The information contained herein is based on information obtained from sources considered to be reliable, but does not
make any representation or warranty, express or implied, as to its accuracy, completeness, timeliness or correctness for
any purpose. All the charts and graphs are taken from publicly available sources or derived from proprietary data.
Expressed opinions may be subject to change without prior notice. Any recommendation contained herein does not
pertain to any specific investment objectives, financial situation and the particular needs of any addressee.

The information herein is published for the information of addressees only and is not to be taken in substitution for the
exercise of judgment by addressees who should obtain separate legal or financial advice. The Company or any of its related
companies or any individuals connected with the group accepts no liability for any direct, special, indirect, consequential,
incidental damages or any other loss or damages of any kind arising from any use of the information herein (including any
error, omission or misstatement herein, negligent or otherwise) or further communication thereof, even if the Company
or any other person has been advised of the possibility thereof.

The information herein is not to be construed as a solicitation to buy or sell any securities, or currency mentioned therein.
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Sources:
www.bloomberg.com, www.cnn.com, www.cnbc.com, www.bsp.gov.ph, www.pse.com.ph, www.inquirer.net,
www.bworldonline.com, www.philstar.com, www.interaksyon.com, www.abs-cbnnews.com, www.thestandard.com.ph,
www.mb.com.ph, www.manilatimes.net, www.malaya.com.ph, www.gmanetwork.com, www.businessmirror.com.ph

This is a product of the BPITrade Sales & BPITrade Research Team. See appendices for analyst certification and important disclosures.

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TRADERS’ TAKEDOWN

Appendix | Sales Disclaimer

This report was prepared by a sales function within BPI Securities Corporation (“BSC”). Any opinions expressed herein are
solely those of the author and may be different from the views expressed by BSC itself and its other departments, including
the research department. Sales functions are subject to potential conflicts of interest which the other BSC departments,
including the research department, do not encounter.

This report is published for the information of the recipients only. This report is not to be construed as a solicitation to buy
or sell any securities, futures, options or other financial instruments, to participate in any particular trading strategy or to
provide any investment advice or services. Any recommendation contained herein does not pertain to any specific
investment objectives, financial situation and the particular needs of any recipient.

BSC is not a deposit-taking institution and their obligations or liabilities do not represent the obligations or liabilities of
the Bank of the Philippine Islands ("BPI"). Securities and other financial instruments discussed, recommended, offered, or
sold by BSC: (a) are not insured by the Philippine Deposit Insurance Corporation; (b) are not deposits or other obligations
of any insured depository institution (including BPI); and (c) are subject to investment risks, including the possible loss of
the principal amount invested.

BSC may deal or transact in a manner inconsistent with the views discussed in this report. BSC trades or may trade as
principal in the instruments mentioned herein. BSC, its directors, officers and/or employees may have positions or other
interests in, and may effect transactions in, securities mentioned in this report. BSC may make a market in the instruments
discussed herein. The author of this report may know the nature of such positions and strategies.

The assumptions, estimates and opinions expressed in this report are the author's judgment as of the date hereof and are
subject to change without notice. Although this report is based on information obtained from sources considered to be
reliable as of the date hereof, the author does not make any representation or warranty, express or implied, as to its
accuracy, timeliness or completeness for any purpose. Any information is subject to change without notice and the author
is not under any obligation to update or keep current the information contained herein.

Certain transactions or securities in this report are subject to substantial risk and are not appropriate for all investors. Past
performance is not necessarily a guide to future performance. BSC deals with counterparties on an arm's length basis.
BSC assumes that each counterparty is capable of making an independent evaluation of the merits and risks of each, and
an independent decision on any, transaction.

BSC does not render legal, tax or financial advice, and the information contained in this report should not be considered
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This is a product of the BPITrade Sales & BPITrade Research Team. See appendices for analyst certification and important disclosures.

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TRADERS’ TAKEDOWN

Appendix | Research Disclaimer

This report was prepared by an analyst(s) of BSC. Any opinions expressed herein are solely those of the author and may
be different from the views expressed by BSC itself and its other departments.

This report is published for the information of the recipients only. This report is not to be construed as a solicitation to buy
or sell any securities, futures, options or other financial instruments, to participate in any particular trading strategy or to
provide any investment advice or services. Any recommendation contained herein does not pertain to any specific
investment objectives, financial situation and the particular needs of any recipient.

BSC is not a deposit-taking institution and their obligations or liabilities do not represent the obligations or liabilities of
the Bank of the Philippine Islands ("BPI").

Securities and other financial instruments discussed, recommended, offered, or sold by BSC: (a) are not insured by the
Philippine Deposit Insurance Corporation; (b) are not deposits or other obligations of any insured depository institution
(including BPI); and (c) are subject to investment risks, including the possible loss of the principal amount invested.

BSC may deal or transact in a manner inconsistent with the views discussed in this report. BSC trades or may trade as
principal in the instruments mentioned herein. BSC, its directors, officers and/or employees may have positions or other
interests in, and may effect transactions in, securities mentioned in this report. BSC may make a market in the instruments
discussed herein. The author of this report may know the nature of such positions and strategies.

The author(s) has received assistance from the subject company in this report including but not limited to meetings with
the management of the company. The analysts and/or associates from time to time seek to establish business or financial
relationships with companies covered in their research reports. Consequently, investors should be aware that BSC and/or
the analysts/associates may have one or more conflicts of interests that could affect the objectivity of this report.

The assumptions, estimates and opinions expressed in this report are the author’s judgment as of the date hereof and are
subject to change without notice. Although this report is based on information obtained from sources considered to be
reliable as of the date hereof, the author does not make any representation or warranty, express or implied, as to its
accuracy, timeliness or completeness for any purpose. Any information is subject to change without notice and the author
is not under any obligation to update or keep current the information contained herein.

Certain transactions or securities in this report are subject to substantial risk and are not appropriate for all investors. Past
performance is not necessarily a guide to future performance. BSC deals with counterparties on an arm’s length basis.
BSC assumes that each counterparty is capable of making an independent evaluation of the merits and risks of each, and
an independent decision on any, transaction.

BSC does not render legal, tax or financial advice, and the information contained in this report should not be considered
as such and should not be taken in substitution for the exercise of judgment by the recipient who should obtain separate
legal, tax or financial advice. No liability whatsoever is accepted for any direct, special, indirect, consequential, incidental
damages or any other loss or damages of any kind arising from any use of the information herein (including any error,
omission or misstatement herein, negligent or otherwise) or further communication thereof.

This is a product of the BPITrade Sales & BPITrade Research Team. See appendices for analyst certification and important disclosures.