INTERNATIONAL Container Terminal Services Inc. (ICTSI) has surpassed P2 trillion in market capitalization, cementing its position as the Philippine Stock Exchange’s (PSE) most valuable listed company and the benchmark index’s dominant constituent.
The Enrique Razon Jr.-led global port operator hit a market value of approximately P2.04 trillion, with its shares closing at P960 on Tuesday after trading between P960 and P995.
The port operator’s huge market capitalization has fueled market speculation that it could eventually delist, although analysts said this was unlikely.
Jarrod Tin, equity research analyst at DragonFi Securities, said rumors circulating in the market include a possible move by ICTSI to the Hong Kong Stock Exchange.
Such a scenario, he noted, would have significant implications for the local market, as “the PSEi would lose its top-weighted stock and primary source of alpha.”
He added that ICTSI’s size made it a key driver of index performance and fund returns.
Alpha in financial market terms refers to the incremental return achieved by fund managers in excess of benchmark returns. If an investment strategy, such as exposure in ICTSI, has generated alpha, an investor is said to have “beat the market” with unusual returns above that of the broader market.
Tin added that local equity funds with heavy exposure in ICTSI would be among those most affected, while a full buyout of public shareholders could cost around P1 trillion given the company’s estimated free float.
“We believe the odds of a delisting are quite low,” he said. “We expect the exchange to do whatever it takes to retain [ICTSI's] marquee listing.”
Tin said a dual listing on the Hong Kong exchange appeared to be a more realistic scenario as ICTSI continues to expand globally.
Manny Ocampo, president and chief operating officer of Investment & Capital Corporation of the Philippines (ICCP), also expressed reservations about a potential delisting, citing ICTSI’s premium valuation in the local market.
“I am not sure why they would want to delist — the PSE is giving them such a fantastic valuation,” he said.
ICTSI representatives were not immediately available for comment.
Ocampo added that while the stock’s valuation may be difficult to sustain, a dual-listing structure appears more plausible than a complete exit from the local exchange.
Bourse data show that the ICTSI Group is currently involved in 32 terminal operations, including concessions and port development projects in 19 countries worldwide.
It has 10 terminal operations in the Philippines; four in Brazil; two in Papua New Guinea; and one each in China, Indonesia, Ecuador, Poland, Georgia, Madagascar, Croatia, Honduras, Mexico, Iraq, Argentina, Democratic Republic Congo, Colombia, Australia, Cameroon and Nigeria.
ICTSI shares rose by P10, or 1.05 percent, to P960 on Tuesday amid a 0.43-percent dip for the benchmark Philippine Stock Exchange index.