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Tag: Philippines

  • Developer DM Wenceslao partners with Hongkong Land through Joint Venture

    Developer DM Wenceslao partners with Hongkong Land through Joint Venture

    D.M. Wenceslao and Associates, Inc. (DMWAI), a developer with one of the largest landbanks in Metro Manila, is teaming up with Hongkong Land through a joint venture (JV) between their respective subsidiaries, Portal Holdings, Inc. and Hongkong Land (Philippines) B.V.

    In a statement, DMWAI said the joint venture will develop primarily residential projects over a land area of approximately 26,000 sq.m.

    The property is within DMWAI’s latest and most innovative project, Aseana City, which occupies a waterfront site with a prominent location in the Manila Bay area.

    Hongkong Land is a listed leading property investment, management and development group which owns and manages almost 800,000 sq. m. of prime office and luxury retail property in key Asian cities, principally in Hong Kong and Singapore.

    It has significant experience in the establishment of world-class residential and business hubs such as the Hong Kong Central Business District and the Marina Bay Financial Centre in Singapore.

    The firm also has a number of residential and mixed-use projects under development in cities across Greater China and Southeast Asia.

    Hongkong Land’s established international track record and experience in developing regional waterfront projects will bring a fresh world-class perspective to the development of Aseana City, said DMWAI.

    DMWAI will also contribute its well-established local development and construction expertise, and a portion of its prime landbank in the Manila Bay Area to the joint venture.

    “We believe that partnerships like this will give us the right combination of local knowledge and global development standards and expertise” said DMWAI chief executive Buds Wenceslao.

    He added that “this is one of the company’s key visions; to transform Aseana City into the Philippines’ next generation city and provide a higher quality of real estate products to our nation.”

    DMWAI is an integrated property developer with an established track record and market-leading capabilities in land reclamation, construction and real estate development. The company has one of the largest land holdings in Metro Manila with over 58 hectares of land.

    Aseana City, the company’s prime asset, is strategically located next to the Entertainment City in the Manila Bay area, and positioned as the next major mixed use CBD within Metro Manila.

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  • Metro surges ahead

    Metro surges ahead

    Last week amid cheers and the beat of drums, Cebuano retailer Frank S. Gaisano – with his siblings Margaret, Jack and Edward by his side – rang the opening bell at the Philippine Stock Exchange (PSE) in Makati.

    The traditional ceremony marked the market debut of Metro Retail Stores Group, Inc., the first for a Gaisano —  an iconic name in Cebu’s retail industry —  and for a Cebu-based company in almost a decade.

    Gaisano said going public, which raised about P3.6 billion for Metro’s expansion, will also enable Metro to “improve margins and operating efficiency, protect our market share, and consequently create value for our investors.”

    Frank Gaisano (4th from left), chairman and CEO, leadS the bell-ringing ceremony to mark the listing of Metro Retail Stores Group Inc. on the Philippine Stock Exchange. Joining him on stage are his siblings Jack Gaisano director, Edward Gaisano, chairman and CEO of Vicsal, and Margaret Gaisano-Ang, director. PSE executives witness the milestone led by chairman Jose Pardo, president and CEO Hans Sicat, and directors Vivian Yuchingco, Emmanuel Bautista and Alejandro Yu. (CDN PHOTO/TONEE DESPOJO)

    “We are ready to compete with other industry players in serving our value-conscious market and be a leading and well-admired retailer,” Gaisano said in a statement issued after the ceremony.

    Metro, retail arm of Vicsal Development Corp., is the fourth largest retailer in the country, after SM, Puregold and Robinsons. It is the largest department store and hypermarket operator in the Visayas.

    The company is embarking on an aggressive expansion program that will see 50 to 70 new stores in the next five years, bringing the company’s network to more than 100 stores.

    This will double Metro’s footprint from the current 400,000-square meters for 46 stores, said Metro President and Chief Operating Officer Arthur Emmanuel.

    “About 100,000-square meters have been secured, including stores that will open in partnership with Megaworld and Ayala. These should open in the next two years,” said Joseph Conrad M. Balatbat, investor relations head of Metro, in a press conference after the bell-ringing ceremony.

    Margaret Gsaisano-Ang holds up the image of Sto. Nino, Cebu's patron, at the Philippine Stock Exchange in Makati as Sinulog dancers perform a dance offering on stage for a touch of Cebuano culture. (CDN PHOTO/TONEE DESPOJO)

    At least seven stores are slated to open next year, including one in northern Cebu and another in the south. Four other stores will serve as anchor stores of Ayala developments while one will rise at the Megaworld mixed-use complex in Iloilo.

    About half of the 50 to 70 new stores that will open in the next five years will be in the Visayas while the rest will be in Luzon and Mindanao, where Metro has yet to establish its presence.

    “The Visayas is our priority. We see the Visayas growing much faster than Luzon. Based on Euromonitor, retail penetration in the Philippines is only 28 percent. It’s much lower in the Visayas,” Balatbat said.

    The bulk or 67 percent of the IPO proceeds will fund this aggressive expansion. The rest will be used for mergers and acquisitions.

    Balatbat said they were in talks for the acquisition of more neighborhood stores that will be rebranded as Metro Fresh N Easy.

    FIRST TRADING DAY

    The Metro stock, with trading symbol MRSGI, opened strong at P4.30 and closed at P4.13, about 3.5 percent higher than the IPO price of P3.99.

    The listing followed an initial public offering (IPO) that issued 905.4 million common shares and raised about P3.6 billion.

    This milestone occurred 33 years after the first store — then called Metro Gaisano — was opened in Colon Street in  Cebu City in 1982.

    Before the bell-ringing ceremony, Sinulog dancers in colorful costumes performed on the trading floor and on  stage as company representatives waved Metro flaglets.

    Metro Retail is run by siblings Margaret, Jack, Edward and Frank. Their parents Victor and Sally, from whose names Vicsal was coined, started Metro with a store in Colon Street that had to compete with seven others in 1982.

    There are currently 46 Metro stores across three retail formats — department store, supermarket and hypermarket (Super Metro) — in the Visayas and Luzon. Twenty-six of these stores are in Cebu and the Visayas.

    With its listing on the PSE, Metro joined three other Cebu-based companies that have tapped the capital market: Cebu Property Ventures and Development Corp. in 1992; and Cebu Holdings, Inc. and Vivant Corp., both in 1994. Aboitiz Equity Ventures and Aboitiz Power Corp. were still based in Cebu when they went public in 1994 and 2007, respectively. Both are now based in Manila.

    “This reflects our confidence in the capital markets. We believe the Philippine economy is one of the least vulnerable among the emerging economies. We continue to leverage on this positive sentiment on our economy,” Gaisano said during the press conference.

     

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  • Daiso, Robinsons Retail to strengthen PH partnership

    Daiso, Robinsons Retail to strengthen PH partnership

    Daiso Industries Ltd. is impressed with the growth of the Daiso Japan store chain in the country.

    Japan founder and President Hirotake Yano was recently in the country as one of the speakers of the 17th Asia-Pacific Retailers Convention and Exhibition (APRCE) Manila 2015.

    He also met with officials of Robinsons Retail Holdings Inc. (RRHI), appointed franchisee in the Philippines of Daiso Industries. RRHI is led by Robina Gokongwei-Pe, Wilfred Co and Katherine Michelle Yu.

    Yano added that he is very happy with the growth of Daiso Japan in the Philippines. “I first came here four years ago and observed that it was experiencing a very competitive growth, one that was comparable to Daiso in Japan.  I am actually quite proud of this development.”Yano reaffirmed the strong and exclusive partnership between the two companies as he expressed his satisfaction over the Supreme Court’s final ruling in June this year, preventing Japan Home Center (JHC) from using the trademark Daiso.  He reiterated that RRHI is Daiso’s only authorized and licensed partner in the Philippines. It will be recalled that Daiso Industries Co., Ltd filed a complaint with the Intellectual Property Office against Japan Home Center (JHC) in 2009.

    There are now 44 Daiso Japan stores in the Philippines and over 2,400 stores in 30 countries around the world.

    Both Yano and Gokongwei-Pe reiterated the strength of their business collaboration that was sealed in 2008. “I am very confident with the leadership of the Robinsons Group as our Daiso Industries’ exclusive retailer in the Philippines,” he said. “That is why I look forward for continued growth as customer demand increases.”

    Gokongwei-Pe is likewise very optimistic about the expansion of the Daiso Japan brand. “We brought it here knowing that it is a big brand from Japan that offers good quality and affordable products. That, for me, is the best combination that is very much suited to the Philippine market. The items in our stores are the real Daiso merchandise from Japan.  There is a guarantee behind the name and the partnership that we have with Daiso Industries,” Gokongwei-Pe said.

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  • Thai e-commerce firm expands to Metro Manila

    Thai e-commerce firm expands to Metro Manila

    Ascend Group, Thailand’s leading e-commerce retailer, has launched iTrueMart.ph e-commerce website to serve the Philippine market as it sees a huge potential in the country, with the onset of the Asean Economic Community.

    iTrueMart.ph aims to become the dominant e-commerce player in the Philippines by 2017, says Punnamas Vichitkulwongsa, chief executive of Ascend Group, the company behind iTrueMart.

    Following its success in Thailand, iTrueMart is now looking to expand into the Asean Economic Community with the Philippines as its next destination, he says. iTrueMart.ph hopes to bring an unrivaled shopping experience with access to a variety of products, various payment channels, and competitive pricing that are currently only available for metropolitan shoppers to customers in all provinces in the Philippines.

    “E-commerce will have huge potential when the AEC fully materializes,” says Vichitkulwongsa.

    According to a study by Ystats SE Asia eCommerce, the volume of Asean’s mobile Internet users rose 56 percent in 2015. Up to 56 percent of the Thai and Vietnamese populations are now accessing the Internet via their smartphones, a figure close to the Philippines’ 50 percent rate. “Recognizing the growing number of mobile-Internet users, we are confident that online shopping in the region will also grow. The AEC is an emerging and interesting market for e-commerce through which entrepreneurs can expand their businesses,” says Vichitkulwongsa.

    “At present, iTrueMart has already been tapping into the AEC market with over $150 million Uinvestment planned for 2016. The investment will be used for e-commerce optimized fulfillment centers, logistic hubs, expansion of our own fleet, marketing, and ramping up assortment and inventory. We are debuting our operations in the Philippines and that will be followed by Vietnam, Indonesia, Myanmar, Cambodia, Malaysia and Singapore later in 2016. We are committed for long-term success in the Philippines and everywhere else that we go to,” he says.

    Seubsakol Sakolsatayadorn, general manager of the iTrueMart division at Ascend Commerce, says iTrueMart.ph is not a newcomer to the market as the team is backed by the strong success of iTrueMart in Thailand. “During the past year, the number of visits to iTrueMart.com has increased by as much as 424 percent. Since October 2014, the average number of visits recorded was 4.6 million per month. iTrueMart.com receives 7,000 orders per day on average, with the highest volume of daily orders at 10,000. This marks the highest record in Thailand’s online retail industry,which puts iTrueMart.com at the forefront of Thailand’s e-commerce sector. Moreover, iTrueMart.com’s delivery averages at two days throughout Thailand and it enjoys the lowest e-commerce return rate in the country which confirms the trust and shows the high quality of the products offered on the website,” says Sakolsatayadorn.

    Dean Krstevski, chief operating Officer E-Commerce of Ascend Group, says the decision to launch in the Philippines stemmed from the fact that competition in the e-commerce sector in the Philippines is still considered low. “With the market still in its infancy, there are still plenty of opportunities for new players. Now that the e-commerce market is being developed, brands are increasingly looking for partners to sell their products online, which we see as a great advantage that will help us speed up our market entry. We are confident of our success in the Philippines because we have a strong team with extensive experience in both online and offline retail,” says Krstevski.

    Under the slogan “Great Value, Everyday,” iTrueMart.ph works only with authorized distributors of international brands and act as authorized dealer of local brands so customers can be guaranteed that all products on the website are genuine. The current focus of the site is on smartphones and gadgets and it will expand into consumer electronics, computers and laptops, health and beauty and moms and kids in the future.

    iTrueMart.ph offers free delivery and free returns with cash on delivery payment as an option for customers. To deliver the best possible end-to-end customer experience, iTrueMart.ph is starting off delivery in the Luzon area and will further expand from the beginning of next year. iTrueMart.ph is targeting to have 100 vehicles in its delivery fleet by the year-end, operating out of its own fulfillment center in Pasig.

    With 45 percent of the traffic coming from mobile devices, iTrueMart.ph has a mobile version while a mobile application will be rolled out by the first quarter of 2016.

    “iTrueMart.ph is determined to become the dominant e-commerce player by 2017 and the second largest e-commerce player by the end of this year through partnerships with key local brands and authorized distributors, as well as attractive Christmas campaigns, where customers are offered great value and guaranteed delivery before Christmas Eve. Our goals are to be the top-of-mind e-commerce brand, to have great assortment at best prices, to provide the best end-to-end customer experience and to become the most trusted online shopping platform,” says Krstevski.

  • SM Prime opens third mall in Cebu

    SM Prime opens third mall in Cebu

    SM Prime Holdings, Inc., one of the leading integrated property companies in Southeast Asia, opens today its newest regional landmark, SM Seaside City Cebu.

    In a disclosure to Philippine Stock Exchange, SM Prime said this is its 56th mall in the country, and the third mall within Cebu – along with SM City Cebu and SM City Consolacion.

    The new destination mall provides an additional 430,000 square meters (sqm) in gross floor area (GFA), expanding SM Prime’s total retail space to 7.3 million sqm in the Philippines.

    SM Seaside City Cebu is the first of many developments in the 30-hectare SM Seaside Complex which SM Prime president Hans T. Sy said will take about five years to fully develop.

    SM Seaside City Cebu, located within the SM Seaside Complex at the South Road Properties (SRP) in Cebu City, is the first of its kind in urban development in the SRP.

    As the anchor development, the mall is slated to transform the city’s landscape as SM Prime builds residences, offices, an arena, a five-star hotel, and convention centers.

    The Complex features “The Cube”, a steel sculpture that symbolizes strength and stability of Cebuanos and its consistency reflects SM’s continued commitment to excellence.

    “We are inspired by the success of our Mall of Asia Complex in Pasay City, the first lifestyle city project or mixed-use development that offers retail, residences, offices, hotels and convention centers,” Sy said.

    He added that “we are replicating this concept of ‘lifestyle cities’ in Cebu as we open the SM Seaside City mall. We see Metro Cebu as one of our important growth corridors in Visayas and Mindanao following our growth track in Metro Manila.”

    The new destination mall will open with 80 percent of space lease-awarded which serves as the new home to flagship stores of well-known local and international brands. It will also be the venue of unique and world-class events and entertainment.

    The shopping mall will have anchor tenants such as The SM STORE, SM Supermarket, Forever21, UNIQLO, Our Home, Ace Hardware, SM Appliance Center, Watson’s, The Body Shop, Kultura, BDO Unibank, and Chinabank.

    SM Seaside City Cebu is the newest architectural jewel of SM Prime with its nautilus inspired design of concentric arcs from a central multi-purpose space featuring a “Seaside Tower,” a 147-meter iconic viewing tower which offers a sensational panoramic view of the entire city.

    A Sky Park provides a  unique setting for diverse dining outlets situated in an elevated garden with soothing water features. The mall will have a skating rink, eight cinemas houses and 5,000 parking slots.

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  • iTrueMart enters Philippines, plans to invest $55 million

    iTrueMart enters Philippines, plans to invest $55 million

    iTrueMart, Thailand’s leading e-commerce retailer, has launched its first e-commerce site in the country, iTrueMart.ph, and targets to be the dominant local e-commerce player in two years.

    In 2016, the online retailer, one of the companies under Bangkok-based Ascend Group, plans to invest over USD$150 million (more than P7 billion) in the ASEAN Economic Community (AEC) as part of its regional expansion.

    “The investment will be used for e-commerce optimized fulfillment centers, logistic hubs, expansion of our own fleet, marketing, and ramping up assortment and inventory,” announced Ascend Group CEO Punnamas Vichitkulwongsa.

    “We are debuting our operations in the Philippines. Vietnam, Indonesia, Myanmar, Cambodia, Malaysia, and Singapore will follow later in 2016. We are committed for long-term success in the Philippines and everywhere else that we go to,” he underscored.

    “Competition in the e-commerce sector in the Philippines is still considered low. With the market still in its infancy, there are still plenty of opportunities for new players,” Dean Krstevski, Chief Operating Officer E-Commerce of Ascend Group, reasoned.

    “Now that the e-commerce market is being developed, brands are increasingly looking for partners to sell their products online, which we see as a great advantage that will help us speed up our market entry. We are confident of our success in the Philippines because we have a strong team with extensive experience in both online and offline retail.”

    They are investing about US$4-5 million in the Philippines this year and easily $50 million in 2016.

    The Philippines is iTrueMart’s second destination in AEC, bringing access to a variety of products, various payment channels and competitive pricing currently limited to metropolitan shoppers.

    “E-commerce will have huge potential when the AEC fully materializes,” confirmed Ascend Group CEO Punnamas Vichitkulwongsa.

    According to a study by Ystats SE Asia eCommerce, the volume of ASEAN’s mobile Internet users rose 56% in 2015. Up to 56% of the Thai and Vietnamese populations are now accessing the Internet via their smartphones, a figure close to the Philippines’ 50% rate.

    Recognizing the growing number of mobile-Internet users, the Ascend Group is confident that online shopping in the region will also grow.

    Furthermore, “iTrueMart.ph is not a newcomer to the market as the team is backed by the strong success of iTrueMart in Thailand,” according to iTrueMart General Manager Seubsakul Sakolsattiyathorn.

    During the past year, the number of visits to iTrueMart.com increased 424%.

    Since October, 2014, the retailer averaged 4.6 million  visits per month. iTrueMart.com receives 7,000 orders per day on average, with the highest volume of daily orders at 10,000, the highest record in Thailand’s online retail industry.

    Add to that, iTrueMart.com’s delivery averages at two days throughout Thailand and it enjoys the lowest e-commerce return rate in the country.

    Under the slogan “Great Value, Everyday,” iTrueMart.ph works only with authorized distributors of international brands and act as authorized dealer of local brands so customers can be guaranteed that all products on the website are genuine.

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  • BDO firms up tie-up with Japanese banks

    BDO firms up tie-up with Japanese banks

    BDO Unibank, Inc. (BDO) and FIDEA Holdings Co., Ltd. (FIDEA Group) further strengthened their business relationship through a memorandum of understanding (MoU) that will allow BDO to provide support to FIDEA’s clients who plan to invest in the Philippines.

    FIDEA is a joint holding company between major Japanese regional banks The Shonai Bank, Ltd. (Yamagata prefecture) and The Hokuto Bank, Ltd. (Akita prefecture).

    Both banks have partnered with BDO Unibank under the Japan Bank for International Cooperation (JBIC) framework in 2013. Said framework was developed to support the banking needs of Japanese enterprises eyeing the country as a business destination.

    The partnership with the FIDEA Group will provide BDO Unibank adequate coverage in Japan’s northern region (Tohoku), specifically in Akita, Yamagata, and Miyagi prefectures where majority of the primary industries (agriculture, fishing, forestry, mining) are located.

    As a leading player in the local banking sector, BDO Unibank can provide the Japanese clients financial and non-financial advisory services, and other products and services that would be helpful to them should they decide to set up shop in the Philippines.

    Since 2007, BDO has established a fully staffed Japan Desk, with Japanese-speaking personnel, dedicated to market and service Japanese companies operating in the Philippines, and service the retail needs of Japanese customers.

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  • Air Asia Philippines Launched Red Hot P0.01 Flight Promo Sales

    Air Asia Philippines Launched Red Hot P0.01 Flight Promo Sales

    This Christmas, Santa Clause won’t be the only one painting the skies red. AirAsia Philippines will also be coming to town with a Red Hot P0.01 Flight Promo Sale beginning on November 23.

    air asia peso promo sale

    The one-centavo seat sale includes promo fares to all domestic destinations from Manila including Tacloban, Cebu, Davao, Tagbilaran, Palawan, and Kalibo. International destinations are also included in the sale with popular cities such as Kuala Lumpur, Kota Kinabalu, Busan, Macau, and Hong Kong.

    AirAsia Group is also offering great promotional fares to more than 100 destinations across 20 countries including Australia. Passengers travelling from the Philippines can seamlessly connect in Kuala Lumpur to one of AirAsia Group’s many great destinations.

    AirAsia Promo Fares can be booked on the AirAsia website from today until November 29, 2015. Promotional fares are valid for travel from May 1, 2016 to February 5, 2017. As Philippines AirAsia’s Commercial Head, Gerard Peñaflor explains, the one-centavo sale comes at the perfect time for giving the gift of travel this Christmas.

    “Travelling with your friends and family to Palawan, Boracay, Bohol, Davao, or to Hong Kong, Korea, and other AirAsia destinations make an ideal holiday gift and our one-centavo seat sale makes the deal even sweeter,” said Peñaflor. “From as low as P201.00 all-in fare, travellers will get to discover new places here in the Philippines and across AirAsia’s massive network in the whole of ASEAN region and extending as far as China, India, Japan, and Korea.”

    air asia promo fares

    Peñaflor added that AirAsia will also be unveiling the latest in-flight menu to enhance the on-board experience before the busy Christmas season. “To enhance our guests’ flying experience, we are set to launch before Christmas, Philippines AirAsia’s latest in-flight menu which now includes new hot meals featuring Filipino favorites such as Bangus sisig, chicken curry including ASEAN-inspired dishes,” added Peñaflor. “Now, everyone can enjoy great value services on top of the promo seats that we are offering.”

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  • Vista Land takes control of Starmalls

    Vista Land takes control of Starmalls

    Philippine company Vista Land & Lifescapes has paid US$691 million for a controlling 88 per cent stake in property developer Starmalls.

    While both companies are essentially controlled by the family of former Philippine senator Manuel Villar, Vista believes the acquisition will transform it into a fully integrated property developer with continued leadership in horizontal residential projects combined with a sizeable and growing mass market retail mall and BPO platform and the ability to replicate the integrated ‘Communicity’ model across the Philippines.

    “In addition, the company believes that the enhanced scale and stability provided by the acquisition and extensive synergies between the two businesses will strongly benefit the company and its shareholders going forward,” Vista said in a statement.

    Starmalls is a developer, owner and operator of retail malls targeting mass market retail consumers in the Philippines. It focuses on densely populated areas underserved by similar retail malls and within close proximity to transport hubs and key infrastructure.

    It owns and operates 10 retail malls in key cities and municipalities in the Philippines and two BPO commercial centers in Metro Manila, with a combined gross floor area (GFA) of 509,385 sqm. It has another four retail malls and one BPO commercial centre under construction, and plans to grow to over 1 million sqm in GFA via enhancements to existing assets and to over 1.3 million sqm in total GFA including new developments by the end of 2018.

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  • Fashion chain M)phosis shutters stores

    Fashion chain M)phosis shutters stores

    Singapore-founded fashion retailer M)phosis is reportedly closing all its Southeast Asian stores due to financial challenges.

    The Straits Times has reported the chain is in the process of closing remaining stores in Vietnam, Malaysia, the Philippines and Indonesia – more than 10 in all. Its last Singapore store, in VivoCity, ceased trading at the end of August. Only its China stores will continue to operate.

    The company has not updated its Facebook page since August, but some disappointed fans of the brand have posted messages on the page, ranging from sadness at the retailer’s apparent demise to anger over being left with vouchers which can no longer be redeemed or cashed in.

    Director Hensley Teh confirmed to the Straits Times the brand remains in the China marketplace.

    “We were having a severe cash flow situation. We were not able to continue, despite wanting to. We did everything we could. We thank our customers, who have supported us all these years.”

    M)phosis made its debut in 1994, targeting women aged 18 to 35. At one stage it operated in Australia, Hong Kong, Dubai and Japan and had a network of 30 stores, but it has since retrenched from those markets.

  • Wenceslao to test investor appetite in Philippines

    Wenceslao to test investor appetite in Philippines

    DM Wenceslao and Associates, a construction and real estate company, has launched pre-marketing for a $150 million to $200 million initial public offering that could turn out to be the Philippines largest flotation of the year.

    The deal is coming at a time when the Philippines Stock Exchange PSEi Index appears to have resumed its losing streak. The market initially turned downwards in April after hitting a year-to-date peak of 8,127.48 and enjoyed only a very brief respite in October when all global equity markets picked up again.

    On Monday, it fell 1.8% to close at 6,772.92.

    Year-to-date it is down 6.33%, with foreign investors net sellers every month since April.

    DM Wenceslao will test their appetite to return to the market since it hopes to place 70% of its IPO with international accounts, according to its registration statement.

    The company is hoping its high growth profile will also persuade them to accept a premium valuation compared to both the exchange’s average 16 times forecast 2016 p/e ratio and the property sector’s 18 times average.

    Valuation

    According to its most recent filing, the company plans to sell up to 429 million shares at a maximum price of Ps44 per share, potentially generating total proceeds of as much as Ps17.47 billion ($370 million).

    However, sources close to the deal said the pre-marketed range equates to a market capitalisation of about $1 billion. This is towards the bottom end of a Ps45 billion to Ps62 billion ($950 million to $1.31 billion) fair value range assigned by Citic CLSA, one of the IPO’s joint bookrunners.

    This range represents a 30% to 50% discount to net asset value and equates to a p/e ratio of 32 to 43 times forecast 2016 earnings of Ps1.438 billion.

    In 2014, the company reported earnings of Ps339 million. In 2015, they are forecast to triple to Ps1.14 billion.

    Gaming proxy

    DM Wenceslao is said to be pushing forwards with the deal despite the weak market conditions because it needs to raise fresh capital to fund the development of four of its 10 construction projects.

    Capital expenditure is expected to grow 187% to Ps2.4 billion in 2016 from Ps842 million this year, and by a further 180% to Ps6.8 billion in 2017, Citic CLSA estimates.

    In addition, the company’s net cash position deteriorated by 44% on a year-on-year basis to Ps1.2 billion in 2014.

    The company was founded 50 years ago as a pure construction company. However, it has recently been transformed into a real estate leasing company after the Philippines Reclamation Authority transferred 829,000 square metres of land as part of the Manila Bay area reclamation project.

    As a result of the land transfer, DM Wenceslao currently owns roughly 80% of Aseana City, a mixed-use development area partially overlapping Entertainment City, the Philippine’s fast expanding gaming hub.

    Over the next five years the company plans to lease 5,000 square kilometres of land per annum.

    In 2012, DM Wenceslao generated 71% of its revenues from construction projects and 28% via rental income. This has now turned on its head with property leasing accounting for 75% and construction 19%, a far more stable revenue mix that may appeal to investors.

    The company is expecting to generate higher growth than other Philippines property developers because of its proximity to Entertainment City, which is being developed as Asia’s Las Vegas-like gaming and entertainment complex.

    Currently, two casinos under Bloomberg Resorts and Belle Corp have started operations while Traveller International Hotel Group and Tiger Resorts’ casinos are set to open in 2017 and 2018 respectively.

    On the flip side, it will suffer from any downturn in the country’s gaming business, which is currently the key attraction for tourists to visit the area.

    DM Wenceslao is expected to commence the retail offering for its IPO on December 4 and list on December 17, according to the company’s filings to the Philippines stock exchange.

    So far this year, the largest IPO has been the Ps3.621 billion offering for Metro Retail Stores completed earlier this month, one cent below its marketed range of Ps4 to Ps4.80.

    BPI Capital, Citic CLSA, Deutsche Bank and Maybank are joint global coordinators and bookrunners for the new deal.

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  • Groupon woes continue

    Groupon woes continue

    Groupon – which has exited three Asian markets this year – continues to struggle globally with ts flawed discounting model.

    Operating on wafer thin margins in the first place, the company has taken a severe hit from currency exchange fluctuations in the third quarter.

    Globally, gross billings grew by six per cent when the exchange rate impact is excluded; similarly, global revenue increased by a more positive seven per cent on a constant currency basis.

    But after taking into effect the strengthened value of the US dollar against foreign currencies this year, Groupon saw its net losses grow by some $6.4 million to $27.6 million.

    As reported by Inside Retail Asia in September, the listed US eCommerce business has closed its doors in Thailand, the Philippines and Taiwan. Outside Asia it has already exited Greece and Turkey and will now close operations in Panama, Morocco, Puerto Rico and Uruguay.

    Neil Saunders, CEO of Conlumino, says the impact of currency fluctuations is worsened by the fact that the company operates off relatively low margins, especially outside of its North American heartland, and as such does not have much of a buffer against their deleterious effect.

    “The margin position is partly down to the multiple systems that Groupon operates across the globe which increase complexity and do not allow for economies of scale. While this is something the company has been remedying by moving to a common platform, we believe that the benefits have, so far, been fairly modest.”

    Saunders says margins are also held back by a further issue, arising from Groupon’s revenue mix.

    “At present, the company divides itself into three main segments: Local, Goods, and Travel. Local is concerned with deals from service providers like restaurants, events and activities. Goods is focused on consumer products like jewellery, electronics and apparel. And Travel is about holiday, flight and accommodation deals.

    “Recent growth in the more mature Local part of Groupon’s business has slowed considerably. Indeed, in Q3 growth was just under eight per cent. Comparatively, Travel and Goods have both seen strong growth, up 20 per cent and 18 per cent, respectively. This rebalancing of the revenue mix has diluted margins, mainly because Goods are far less profitable for the firm.”

    Saunders says gross profit as a percentage of gross billings for Goods is 13 per cent compared to 30 per cent in Local and 18 per cent in Travel.

    “To be fair, the margin performance of Goods has improved over the past year – but not by much. Over future quarters, we see the prospects for margin gains to be slight given that Groupon has to work harder on Goods deals in a market that remains very promotional.”

    Saunders believes there is little comfort ahead for Groupon in the fourth quarter.

    “Groupon is forecasting that revenues will come in at $865 million, at best. This is quite some way below the $883 million generated last year.

    “In our view, such anemic numbers do not paint a rosy picture for future profits. They also bode badly for the start of the new fiscal year – an issue the new CEO, Rich Williams, who is replacing Eric Lefkofsky who’s stepping into the role of chairman, will have to deal with,” Saunders concluded.

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  • Filipinos Purchased Over 120,000 Items from Lazada on November 11

    Filipinos Purchased Over 120,000 Items from Lazada on November 11

    November 11 has become the largest online shopping day in the world. For Lazada Philippines (www.lazada.com.ph), the country’s leading one-stop shopping and selling destination, 11/11 marked the start of its highly anticipated Online Revolution Sale and the beginning of the Christmas shopping season.

    Lazada sent online shoppers into a frenzy starting midnight of November 11 with customers purchasing 120,000 items across different product categories. Over 5,000 units of smartphones were sold on that day alone. Discounted and exclusive cellphone models from top brands such as Alcatel, Lenovo, ASUS and Cherry Mobile were the day’s bestsellers. Lazada also sold over 4,500 packs of disposable diapers, a clear indication that Filipino parents are embracing the convenience of online shopping. Hundreds of early Christmas shoppers were able to snap up this season’s hottest toy, the hoverboard or 2-wheeled scooter for as low as P7,999.

    As projected, Lazada exceeded its online sales records with a 6x increase in sales over its October average – the best uptake among all the countries in Southeast Asia where Lazada operates. The site registered 2.4 million visits and orders came from all over the country. 70% of total orders came from areas outside of the National Capital Region.  

    This year’s Online Revolution Sale broke new ground for Lazada as 60% of its orders came from shoppers using mobile devices. The Lazada mobile app was downloaded over 3x more on November 11 compared its average downloads during October. The app was ranked as the overall #1 app on the Apple App Store, ahead of Facebook, Instagram and YouTube.  It continues to be the number one shopping app on both App Store and Google Play Store.

    The big sale on Lazada continues and will culminate in a Grand Christmas Sale on Dec. 10 – 12. On top of deals and discounts, Lazada is also raffling off Cebu Pacific airline tickets to international destinations weekly and a brand new Hyundai Eon in the grand draw. 

     

  • SM Retail posts solid sales growth

    SM Retail posts solid sales growth

    SM Retail of the Philippines has reported a 6.5 per cent increase in sales over the first nine months of the year to PHP145.3 billion (US$3.1 billion).

    Profit rose 21 per cent to PHP4.6 billion (US$98.2 million).

    Reviewing its operating divisions over the period, the company said its SM Food Retail Group (SM Markets) continued to expand in both urban and rural communities in various parts of Luzon, Visayas and Mindanao, adding 20 new stores, most of which are standalone Savemore stores.

    From historically operating anchor stores based in malls, SM Markets now follows a multi-format growth strategy to address the lack of organised retail in many parts of the country.

    SM Markets also recently invested in the minimart business with Alfamart, a successful minimart operator in Indonesia, and forged partnerships with WalterMart and Citymalls to further facilitate its provincial growth. Acquisition of existing chains of stores is another part of its growth strategy, the latest of which was the three stores of Cherry Foodarama.

    The SM Store will maintain its strategy of growing as an anchor store in SM Malls which are targeting expansion in the provincial areas. The SM Store continues to be the leading player in the country’s department store business, enjoying a wide-reaching and loyal customer base. It competes by providing the widest assortment of products and services, complemented by well-designed stores.

    As at the end of September, SM Retail had 294 stores, comprising 51 The SM Stores, 41 SM Supermarkets, 43 SM Hypermarkets, 130 Savemore stores and 29 WalterMart stores

  • Calypso Technology Partners With China Bank in the Philippines

    Calypso Technology Partners With China Bank in the Philippines

    Calypso Technology, Inc., the standard for treasury and capital markets software, has signed its first client agreement in the Philippines, furthering its rapid 2015 expansion in Asia Pacific. The onboarding of China Banking Corporation (China Bank), one of the top banks in the country, follows similar successes in China, Hong Kong, and Korea during the last several months.

    By upgrading its treasury system with the Calypso front-to-back trade processing solution, China Bank has reduced its dependence on custom development and the operational risks associated with manual operations.

    “At the core of our decision was Calypso’s dedication to understanding our unique business needs,” said Antonio Espedido Jr., Executive Vice President & Head of the Financial Capital Markets & Investment Segment at China Bank. “Calypso’s modern technology is highly scalable and will support our business direction and allow us to achieve our aggressive growth targets in the future. Together with its local partner Kris FinSoftware, I am confident that Calypso can bring industry best practices to China Bank while retaining our local feel and expertise.”

    “Collaborating with one of the leading banks in the Philippines in addressing their current issues is such an honor. We look forward to partnering with more banks locally as Calypso and Kris FinSoft continue the efforts to help banks’ treasury businesses,” said Sherrizah Lubigan, Business Development Manager at Kris FinSoftware, Inc.

    “It’s always exciting for us to solve the local challenges of banks in a new country, and the core of this project is a software solution that can help the entire region,” said Mark Bell, Regional Manager at Calypso. “We are excited about more banks in the Philippines joining us, and bolstering our commitment to expand our services for the region.”

    Calypso Technology continues to make significant investments in the Calypso software product with over 50% of its staff dedicated to research and development. Calypso is a Leader in the Gartner Magic Quadrant for Trading Platforms, and the #1 selling Treasury and Capital Markets Solution for the sixth year running in the 2015 IBS Sales League Table.

    About Calypso Technology, Inc.Calypso Technology provides award-winning, enterprise-wide software solutions that empower capital markets, investment management and treasury professionals around the world. We have been setting the global standards for innovative, cost-effective financial markets software solutions since 1997. Now trusted by more than 34,000 financial market professionals in 60 countries, our integrated trading, risk and investment management solutions are leading the industry towards full systems consolidation.

    We address rapidly evolving capital and regulatory challenges with robust, nimble and scalable technology. It’s part of our commitment to facilitate operational and financial excellence throughout the workflow. From front to back office, our solutions are global, universal and future-proofed, and are relied on by more than 200 financial institutions, including over half of the top 25 banking institutions.

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