Golden opportunity: Razon’s Apex Mining a safe bet amid peso woes
By Ian C. Sayson | Bilyonaryo.com | May 23, 2024
Enrique K. Razon Jr.
Gold producer Apex Mining, owned by ultra bilyonaryo Enrique K. Razon Jr. is emerging as a safe haven in the Philippine equities market, which is being pummeled by a slumping peso.
The other stocks that could fare better than others include broadband provider Converge, telecom giant PLDT and customized raw materials manufacturer D&L Industries, according to Ferdinand Subido, senior analyst at AP Securities.
“The prolonged woes of the peso have brought jitters to the market since many of its prominent names either have significant dollar debts, rely on imports, or a combination of both,” Subido said.
The peso has weakened 0.9 percent against the greenback in the past month, making it one of the worst-performing currencies against the dollar and bucking the appreciation trend of many of its peers in Asia. The peso has weakened 4.6 percent since the end of 2023, denting appetite for the nation’s equities.
With its sales denominated in dollars and expenses in pesos, the weaker exchange rate magnifies Apex’s revenue in peso terms, giving the gold miner a windfall, according to Subido. For every 100 bps weakness in the peso, Apex gets a P36.4 million peso topline boost, he said.
According to Subido, JG Summit Holdings Inc., led by bilyonaryo Lance Gokongwei, and the Zobel family’s Ayala Corp. are among the companies that will not fare well due their dollar exposure from debt and imports.
The other “less fortunate souls” are Cebu Air, snacks-manufacturer Universal Robina and grocer Puregold, he said.
Source: Bilyonaryo.com
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