(Bloomberg) — For the Philippines’ largest conglomerate, with interests ranging from buying grocery malls to banks, the worst is over in terms of inflation and there’s a threat that income expansion will be as smart as last year as revenge spending wanes.
“The scenario has advanced in some areas, but in the Philippines we are still in a phase of peak inflation,” Teresita Sy-Coson, vice president at SM Investments Corp. , told Bloomberg TV’s Yvonne Man, on the sidelines of Bloomberg. New Economy. Forum in Singapore.
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“It will be some time” before the Southeast Asian country experiences the peak of rising customer value, Sy-Coson said, a day after government data showed inflation fell to a three-month low of 4. 9% in October from 6. 1% last month. . .
The comments by one of the owners of the Philippines’ largest company by market capitalization are in line with the persistent inflationary dangers flagged through the Bangko Sentral ng Pilipinas on Monday, particularly due to rising transportation costs, price lists of electricity, oil costs and an imaginable strong El Niño phenomenon.
The central bank said it was “necessary to sufficiently adjust financial policy parameters” until a sustained downward trend in inflation becomes apparent. Last month, the Federal Reserve raised the policy rate to a 16-year high after an off-cycle meeting.
Sy-Coson said the higher interest rate environment that “separates the big guys from the small guys” has led to more debt restructuring. Philippine businesses and industries “are still in good shape,” he said.
SM owns BDO Unibank Inc. , SM Prime Holdings Inc. and SM Retail Inc. , the nation’s largest lender, mall operator and retailer, respectively. The renewable energy, generation and healthcare sectors are spaces of opportunity, said Sy-Coson, daughter of former Philippine tycoon Henry Sy.
“I think the bank is doing well. He has supported many other people who need to grow. There are opportunities for expansion in dubious times,” he said.
But the expansion of client spending this year — that is, in the highly seasonal fourth quarter — may not be as smart as last year, when SM Investments saw its spending retaliate, he said.
The conglomerate said on Wednesday its net profit for the nine months ended in September rose 30% year-on-year to 55. 9 billion pesos ($1 billion). It reported a 53% expansion in its net source of revenue for the full 2022.
—With Andy Clarke’s.
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