SHARES in PLDT Inc. fell last week despite finalizing the $1-billion data center sale and planning to accelerate fifth-generation (5G) adoption in low-income markets.
Data from the Philippine Stock Exchange (PSE) showed the Pangilinan-led company ranking 13th in value turnover with P295.23-million worth of 206,830 shares exchanging hands from June 10 to 14.
Financial markets were closed on June 12, in observance of Independence Day.
The telco giant’s shares closed at P1,420 apiece on Friday, dipping by 2.7% from its P1,460 close a week earlier.
Year to date, the stock grew by 11%.
Aniceto K. Pangan, equity trader at Diversified Securities, Inc., said that the downtrend in the stock’s price movement was mainly due to the unexpectedly strong job report data in the US.
Given this, it may further delay the decrease in lending rates until next year, which will keep high lending rates in place and restrain global economic activity.
The US economy created more jobs in May and annual wage growth picked up, highlighting the resilience of the labor market and reducing the likelihood of the US Federal Reserve cutting rates in September, Reuters reported.
Reuters report added that the unemployment rate ticked up to 4% from 3.9% in April, a symbolic threshold below which the jobless rate had previously held for 27 straight months.
Back home, the Bangko Sentral ng Pilipinas said earlier this month that it might cut its policy rates before the US Fed despite the peso’s volatility.
The central bank’s Monetary Board maintained its policy rate steady at a 17-year high of 6.5%, hiking borrowing costs by a cumulative of 450 basis points from May 2022 to October 2023.
Last week, the Pangilinan-led telco said it is moving forward with the sale of 49% of its data center business to a foreign company for over $1 billion.
The company is in discussions to sell up to 49% of its data center business, ePLDT, Inc., to Japan’s Nippon Telegraph and Telephone (NTT), with its data center valued at $1 billion.
PLDT Chairman and Chief Executive Officer Manuel V. Pangilinan said that the company is in discussions with the final bidder and has agreed on the valuation.
Given this development, the company may no longer pursue its planned real estate investment trust (REIT) listing for ePLDT.
Mr. Pangilinan previously said that its data center unit might consider a REIT listing if negotiations with a foreign entity for its data center sale would not push through.
“The sale of data center for PLDT will definitely be a positive step in sustaining the growth as this will be utilized for the payment of maturing debts and lessen the burden of PLDT in its debt exposure,” Mr. Pangan said in a Viber message.
He added that the launch of low-cost phones with 5G technology will boost revenue by targeting the affordable sector of society where demand is high.
Last week, PLDT officials also discussed that they would focus on the low-cost market by introducing new products tailored to customers on a tight budget.
Mr. Pangilinan said that the telco giant is introducing thousands of entry-level phones with the capability to connect to 5G.
In the first quarter, PLDT’s attributable net income reached P9.82 billion from P9.02 billion in the same period in 2023, up by 9%.
Meanwhile, consolidated revenues grew by 3.6%, reaching P54.22 billion from P52.36 billion in the first quarter of 2023.
Mr. Pangan said that earnings will continue growing in the second quarter, and the full-year growth momentum is expected to be sustained.
“Immediate support [level] is P1,400 while immediate resistance [level] is P1,480,” he said.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Abigail Marie P. Yraola
PLDT shares dip despite positive developments
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