IRC AND THE MAKATI SUBWAY | Marvin Germo

IRC AND THE MAKATI SUBWAY

By: Marvin Germo | January 27, 2019

The need for subways

The Philippines is currently in need of a more disciplined line of transportations. Although the MRT and LRT stations have been there for the commuters since then, we cannot uncover the fact that there is still an increasing demand for vehicles and other means to reach our everyday destinations. To help resolve this problem and the current issue with the heavy traffic in the country especially during rush hours, the administration of Makati has proposed a subway project, which was just recently signed by the Philippine Infradev and a Chinese construction firm.

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The Makati Subway

The Makati Subway will compose of 10 underground stations linked to different destinations in the city. It will have at least 30 doors, which can be accessed from and to its stations. Costing over $3.7 billion, the subway can accommodate up to 700,000 passengers everyday. If per hour, it is estimated to carry over 27,000 people in each direction. The subway will operate 18 hours a day and during its first year, it will have 12 air-conditioned trains that can run with an interval of 3 to 6 minutes.

The Philippine Infradev and CCECC Agreement

The China Civil Engineering Construction Corporation (CCECC) has now signed an agreement with the Philippine Infradev Holdings Inc. (IRC before) to undertake the construction of the $3.7 billion Makati Subway project. The Memorandum of Agreement (MoA) has been entered into by both companies and expected to finish the due diligence process by the end of May. The Chinese firm guaranteed a completion of performance including the financial, legal, and technical diligence.

The Advantages of Makati Subway

It is expected that the subway can make the life of commuters in the city easier. With at least 10 stations and a fast running interval, it can save people from the worsening traffic in Makati. It will increase productivity in the workplace as it will shorten the travel time of the workers. It will also increase job and business opportunities According to the government, 6,000 new jobs will emerge and there will be more chances to build small and medium enterprises.

What does the technicals say?

If you look at the chart below, you will see that the stock is still in a long term uptrend. That also means if you are a position trader, you can still currently hold on to the stock as it is still moving in its bullish path. If you are a quick trader, it’s pretty evident that the stock just bounced from the support at 2. Should the bounce continue, set your sights to take profit at 2.9. Should the stock fail to hold 2 over the next few days, it may retrace and drop to 1.8.

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