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  • 07/05/10 11:16
  • 07/05/10 11:16
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  • Transcript

    • 1. website: www.pse.com.ph e-mail: pirs@pse.com.ph tel.no: (632) 688-7600 INVESTING IN THE STOCK MARKET Best Practices Forum Series April 22, 2009
    • 2.
      • Updates on the Stock Market
      • Investing in stocks
      • PSE initiatives
      Presentation Outline
    • 3. www.pse.com.ph Stock Market Performance Performance of PSEi Up by 42% Up by 26% Up by 15% Up by 42% Up by 21% *as of April 17, 2009 Down by 48% Up by 12%*
    • 4. www.pse.com.ph Stock Market Performance Lehman Brothers and Merrill Lynch collapse, AIG bailed out by US government Crisis low of 1,704.41 pts (10/28) PSEi since the subprime crisis
    • 5. www.pse.com.ph Stock Market Performance PSEi vs. other key Asian Stock Market indices *DJIA down by 7.4% YTD
    • 6. www.pse.com.ph Stock Market Performance – Sector Level Performance of Sector Indices (2007-April 17, 2009 ) Up by 35% YTD Financial Sector Industrial Sector Holding Firms Sector Property Sector Services Sector Mining Sector Up by 15% YTD Up by 13% YTD Up by 4% YTD Up by 4% YTD Up by 28% YTD Up by 5% 2007 Down by 47% 2008 Up by 12% 2007 Down by 52% 2008 Up by 18% 2007 Down by 56% 2008 Up by 17% 2007 Down by 58% 2008 Up by 28% 2007 Down by 40% 2008 Up by 85% 2007 Down by 62% 2008
    • 7. www.pse.com.ph Stock Market Indicators Average daily value turnover (in Php billion) Domestic Market Capitalization (in Php billion) Total Capital Raised (in Php billion) Total Market Capitalization (in Php billion)
    • 8. www.pse.com.ph Net Foreign Transactions (in billion pesos) Stock Market Indicators
    • 9. www.pse.com.ph
      • Impact of the crisis in the broad economy
      • Job losses – unemployment up slightly to 7.7% (Jan. 09) from 7.4% (Jan. 08)
      • Some foreign firms closing shop
      • Exports slowing down – down 40% first 2 months
      • Government projects GDP growth of 3.1% to 4.1% in 2009
      The market’s underlying economy
    • 10. www.pse.com.ph
      • Local banks are highly capitalized
      • Fiscal measures for the past few years have allowed for flexibility in spending
      • Gross international reserves are at an all-time high
      • Large dependence on domestic consumption
      • Inflation tapering off
      • Liquidity still growing
      • BPO and OFW provide various multiplier effects in the economy
      • Increased infrastructure spending
      • Resilience of OFWs
      The market’s underlying economy “ The Philippines has a story to tell”
    • 11. www.pse.com.ph Asian growth rates *2009 based on ADB forecasts as of March 2009
    • 12. www.pse.com.ph Investing in the stock market
      • There are about 400,000 accounts in the stock market, less than ½ of 1% of the country’s population
        • - vs. other markets – 10 -30% of their population invest in the stock market
      • Saving vs. Investing
      • Common misperceptions
        • Rocket science
        • Entails huge investments
    • 13. www.pse.com.ph Investing in the stock market The market as the barometer for economic performance
      • Positives
      • Economic growth
      • Low inflation
      • Low interest rates
      • Good employment figures
      • Good governance
      • Political stability
      • Negatives
      • Slow down in economic activity
      • High inflation
      • Rising interest rates
      • Risk aversion
      • Declining world market
      • Governance concerns
    • 14. www.pse.com.ph Investing in the stock market Market valuation as window to the performance of a company
      • Positives
      • Positive profits
      • Stable financials (good return ratios)
      • Clear cut business plan
      • Regular dividend payments
      • Low P/E ratios
      • Practice of good corporate governance
      • Negatives
      • Negative growth/equity
      • Leverage levels
      • Unclear business direction
      • No fundamentals
      • Poor investor relations
    • 15. www.pse.com.ph Sector Financial Ratios Price-Earnings (P/E) Ratio per Sector
    • 16. www.pse.com.ph Dividend Yield per Sector (in %) Sector Financial Ratios
    • 17. www.pse.com.ph “ It’s funny, the more I practice, the luckier I get. ” - Gary Player Investing in the stock market
    • 18. www.pse.com.ph As of April 15, 2009 No. of listed companies: 246 Market Capitalization: P4.43 trillion Ave. Daily Value turnover: P1.99 billion Trading Participants: 184 (132 Active) Manila Stock Exchange (1927) Makati Stock Exchange (1963) Merged in 1992 Provides platform for trading equity products, warrants, and deposit receipts About the PSE
    • 19. www.pse.com.ph About the PSE 1927 1963 1994 1998 2001 2003 2004 The Manila Stock Exchange, Inc. (MSE) was established The Makati Stock Exchange, Inc. (MkSE) was organized The SEC granted the PSE its license to operate as a securities exchange SEC conferred SRO status to the PSE. PSE was demutualized PSE sold 16.5% of its authorized capital stock to strategic investors thru private placement. The SCCP became a wholly-owned subsidiary of PSE PSE Listed by way of introduction PSE Historical Time Line 1992 Makati Stock Exchange & Manila Stock Exchange merged to become PSE 2008 PSE declares 100% stock dividend
    • 20. www.pse.com.ph Embarking on a new strategic agenda “ The investor of today does not profit from yesterday's growth. ” - Warren Buffet
    • 21. www.pse.com.ph STRATEGIC AGENDA L E V E L U P ist more companies and securities xpand and educate the investor base alue and enforce corporate governance standards nhance shareholder value aunch new products and services pgrade market infrastructure & human resources artner with government & other stakeholders
    • 22. www.pse.com.ph
      • List more companies and securities
      • - Liberalization of listing rules for mining companies
      • - Help enforce laws requiring the public offering of shares of companies in various sectors such as power, oil, utilities and telecommunications
      • - Special tax incentives for newly-listed companies
      Strategic Initiatives
      • Expand and Educate Investor Base
        • 3-unit subject for college students (CMO 39)
        • Certified Securities Specialist Course (12-module course) Short Course on Stock Market Investments – 3-day course
        • Inclusion of stock market topics in High School curriculum
    • 23. www.pse.com.ph Strategic Initiatives
      • Value and Enforce Corporate Governance Standards
        • - Heightened enforcement of disclosure rules
          • - 10-minute rule
          • - Selective disclosure rule
          • - Blackout rule
        • - Creation of Market Integrity Board
        • - Institutionalization of the corporate governance scorecard for publicly-listed companies
        • - Creation of a Special CG Segment in the PSE (funded by the UK government)
    • 24.
      • Enhance Shareholder Value
        • Dividend policy by listed companies
        • Website publication of dividend pay-outs by listed companies
        • - Corporate Governance Improvement Plan for the PSE -
        • Extended trading hours
        • Office integration
      Strategic Initiatives
      • Launch new products and services
        • Securities Lending and Borrowing Program
        • REIT product
        • Exchange Traded Funds
        • Index futures and options
        • Commodities trading
    • 25.
      • Upgrading Human and Physical Resources
      • New trading system
      • Enhanced Surveillance system
      Strategic Initiatives
      • Partner with government and other stakeholders
      • - Personal Equity Retirement Account Act (PERA) – enacted into law
      • Credit Information System Act (CISA) – enacted into law
      • Real Estate Investment Trust - passed by Senate
      • Abolition of DST on secondary trading – passed by the House of Representatives on third and final reading
      • Corporate Recovery and Insolvency Act (CRIA) – technical working group report done last Congress
      • Collective Investment Scheme Law (CISL) - technical working group report done last Congress
      • - ASEAN Collaboration - MOA signed with ASEAN Exchanges
    • 26. www.pse.com.ph “ Fortune favors the brave.” -Virgil, Aeneid
    • 27. THE PHILIPPINE STOCK EXCHANGE Disclaimer: This presentation has been prepared by the Philippine Stock Exchange(PSE) for exclusive use of the party/ies to whom the presentation is being delivered. The PSE and its affiliates, officers, directors, employees and agents do not make representations or warranties, express or implied, on matters such as, but not limited to, the accuracy, timeliness, completeness, currentness, non-infringement, merchantability or fitness for any particular purpose of the information and data herein contained. The PSE assumes no legal liability and responsibility for any loss or damage arising from any decision made or action taken in reliance of information contained herein, or for the consequences of any errors or omissions, and does not represent that the use of information and date herein contained would not infringe privately owned rights. In no event shall the PSE or any of its affiliates, officers, directors, employees, or agents be liable for any loss or injury caused in whole or in part by contingencies beyond their control or negligence in procuring, compiling, interpreting, editing, writing, reporting, or delivering the contents of this presentation. The information contained herein is solely for information purposes only, does not constitute investment advice, and is not intended to influence investment decisions. Advice from a securities professional is strongly recommended before making any legal, financial, or other important decisions.