The Philippines spends a considerable amount of effort on its investor road shows, highlighting everything from government infrastructure projects to private investments for local companies raising funds.
Those with big money are treated as VIPs, afforded five-star banquets and, perhaps, a goodie-bag or two. But smaller investors can be just as valuable if you can find enough of them. Of course, the Philippine Stock Exchange (PSE) also does its best to attract foreign money. The PSE goes to Japan every year—in their words —to showcase the biggest Philippine corporations with the purpose of convincing institutional investors to place funds in the Philippines.
But while all of this is going on, noninstitutional investors are finding their way here also.
A Japanese-run property brokerage house, Seven Seas Properties Corp., has been successfully marketing Philippine real estate to its Japanese clients for some time now. And many of their clients were seeking information about local stock-market investing. A few months ago, their partner—Eagle Equities—brought some of their investors to the Philippines to show the market first hand.
One participant was Emi Ogura, a commercial model from Okayama prefecture, had been investing for about two months before visiting the Philippines. She said she made a 25-percent return in two months investing in issues based on her chart analysis. These included Agrinurture Inc. (ANI) and gaming operator Melco Crown (Philippines) (MCP). Another Japanese gentleman bought shares of blue-chip issues, like San Miguel Corp. and Metro Pacific.
Why would these Japanese seek out profits in the Philippines? Look at the issues they invested in.
Probably, all Japanese stock investor know that their own “San Mig”—Kirin Holdings Co.—has a large position in San Miguel Brewery. They also fully understand the potential profitability of a diverse conglomerate like Metro Pacific. But why ANI and MCP?
Love them or hate them, almost everyone wants a piece of the China story as long as it is profitable. ANI is one of the Philippines’s largest mango exporters with joint-venture agreements selling Philippine agricultural products in China. ANI also owns the local franchise of US-based Tully’s Coffee and has a joint venture with Tully’s Japan to open stores in China. Further, its “Big Chill” subsidiary is raising money to open in China.
Casino gambling may not be legal in Japan, but they know full well about South Korea, Macau, Malaysia and Singapore. Here is MCP joint venturing with one of the Philippines’s largest conglomerates—the SM Group—in a sunrise industry. What other “poor” country has attracted literally billions of dollars for its gaming industry? The gaming industry helps build the economy through foreigners coming to the Philippines. These Japanese investors are looking for profit opportunities and they are finding them here on the PSE.
The gentleman who owns San Miguel shares also owns DoubleDragon Properties Corp., EEI Corp. and Megawide Construction Corp. A growing economy means more corporate profits. It is a good cycle for wealth creation. These purchases also show a belief that the administration will hold to its “build, build, build” promises for infrastructure development.
Now we are informed that Japan’s Daiwa Securities Group Inc. has bought nearly 15 percent of COL Financial Group, the PSE’s largest online stock broker. Daiwa is calling it a “portfolio investment”. And that investment will become more valuable when Daiwa’s clients start pushing the “Buy Button” on COL’s online trading platform.
The old saying is that you must follow the money. From the looks of it, this is only the beginning of Japanese investment funds coming to the Philippines and the PSE. The fact that it is ordinary investors makes it even more important. There are many more small investors than there are big investors.
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E-mail me at mangun@gmail.com. Visit my web site at www.mangunonmarkets.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis tools provided by the COL Financial Group Inc.
1 comment
Thanks. If they have made good returns, maybe we can emulate them.