Metro Pacific Investments Corporation, disclosed it will acquire at least two logistics companies this year. MVP expressed that it plans to invest more in the logistics side and ride the growth of the Philippine economy.
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CAPEX for 2018
With its P100 billion CAPEX budget for 2018, MVP expressed that 6% shall be allocated for further investments in its logistic business. Their logistics arm has interests in logistics, warehousing, courier express, parcel delivery, e-commerce delivery, trucking, freight forwarding, customs brokerage, and domestic shipping.
In terms of Metro Pacific’s current earnings, its logistics along with hospital and other businesses, contributes only 5% to its bottom line. This 2018, the company wants this to be a major contributor to the its total earnings because previously, its power segment via Meralco, was the largest contributor standing at 52 % followed by toll roads at 23%, and lastly water, via Maynilad, at 15%.
The company engaged in the logistic industry back in 2016 when it acquired Basic Logistics Corporation’s assets for P2 billion which was then transferred to Metro Pacific Movers Inc. It also acquired Ace Logistics Inc. in 2017 for P280 million since it has a strong presence in pre-delivery inspection in the automotive industry which the company intends to expand. Alongside this, it invested P2.45 billion in acquiring the small players in the industry namely A1 Move Logistics, Marketing Enterprises, Philfalsh Logistics Inc., and BasicLog Trading.
The stock is currently sideways with a tradable range of 6.30 – 6.90/7. Buy as close to 6.30 every time in bounces there and take profit at 6.90/7. If the stock fails to hold 6.30, it could drop to 6. If it breaks out of 7, the first target price could be pegged at 7.70