AYALA CONTINUES TO POSITION IN THE ENERGY MARKET | Marvin Germo
AC energy

AYALA CONTINUES TO POSITION IN THE ENERGY MARKET

By: Marvin Germo | May 28, 2018

Going Global

Philippine conglomerate Ayala Corporation (AC) through its energy company, Ayala Corporation Energy (AC Energy), entered into a joint venture with UPC Renewables acquiring 50% of the latter’s total shares for an amount of $30 million. AC Energy will also provide a $200 million facility to fund project equity. With AC’s restructuring of its renewable and non-renewable resources, this means they have bigger plans for each segment and, indeed, they are planning to expand their power portfolio. The company has set a goal of 2,000mwh of generating capacity by 2020. This joint venture will boost the company’s position towards attaining its long-term goal.

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AC will spend $200 million on the development of its facilities, including a 1,000 megawatt wind project in North West Tasmania and a 600-MV solar farm in New South Wales. AC Energy President and CEO Eric Francia said that what’s good about the UPC Renewables Australia platform is that it is focused on large-scale projects managed by a high-quality management team that is why they are confident about the company’s investment.

UPC Renewables has built a presence not only in the Philippines but also to all parts of the world such as in the U.S., Canada, China, India, Indonesia, Morocco, Tunisia and Vietnam. It has developed 3,500 MW of wind and solar projects worth over $ 45 billion and it’s currently working on projects totalling 5,000 MW. It has a development portfolio of 3,000 MW in New South Wales, Tasmania and Victoria.

AC’s Energy Portfolio

In a previous article I posted, AC Energy originally placed all of its energy business under a single portfolio but, recently, it classified it into two categories: renewable and non-renewable resources, paving the way for more expansion and development projects for each segment. This is in line with AC Energy’s energy generation target to exceed 5,000 MV by 2025. At the end of 2017, it was able to exceed 1,600 MW nearing its 2,000 MW target by 2020. Las year, AC Energy entered into a development funding with UPC Renewables for its power projects below 50 MW in Indonesia. Apart from this, it entered into a joint venture with AMI Renewables Energy for its wind and solar projects in Vietnam. AC Energy sold 70% of its shareholdings in three domestic hydropower companies to Sta. Clara Corp.

Ayala Group: Steering Towards a Better direction

Ayala group of companies has diversified its portfolio over time by investing in different sectors or industries such as real estate, banking, telecommunications, water supply, education, transport, infrastructure, motorcycle manufacturing and power generation. This joint venture with UPC Renewables Australia will be an addition to their growing portfolio in its international business. AC Energy is expected to grow even more now that it has divided its power generation business into two groups. This gives more room for opportunities and profits to be reaped in different sectors. This joint venture is only the beginning of its global expansion project.

Technicals

The stock has been sideways since March 2018. The tradable range to make money with the stock is at 900 – 992. This represents a 10% gain for stock at this point in time. For quick traders, buy after the bounce at 900 and set your sell target at 992. A breakout from 992 will bring the stock up higher to 1,080 for the short term.

I hope this helps you win in the markets!

If you have not invested in the market yet this video is for you:

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