ON THURSDAY, August 5, came the news that the Philippine Stock Exchange Index (PSEI) has finally been revised.
This index is composed of the top 30 corporations in the Philippines which are listed in the local stock market.
A company makes it to the list if it meets certain qualifications, among them a free float level of at least 15 percent (later to be increased to 20 percent in December, 2022), a ranking of among the top 25 percent by median daily value per month for at least 9 out of 12 months, and high market capitalization.
PSE President Ramon S. Monzon said the reforms they made in the local bourse have been instituted to adopt the best practices of other stock markets in the Asian region and the global environment.
They also wanted their member-firms to follow the Security and Exchange Commission's Memorandum Circular No. 13 series of 2017, requiring companies doing initial public offerings (IPO) to have a minimum public ownership of at least 20 percent.
Now, for the rebalancing of PSEI membership.Starting August 16, AC Energy Corp. of the Ayalas ($PSE:ACEN) and Converge Information and Communications Technology Solutions Inc. ($PSE:CNVRG) of Pampanga's Dennis Anthony Uy will be included in the elite 30.They will replace DMCI Holdings Inc. ($PSE:DMC) and Emperador Inc. ($PSE:EMP).
The entry of $PSE:ACEN in the elite Blue Chips Club has been touted about in Investagrams and other online groups for several weeks now, so there was no surprise there when it happened.
What is surprising is Emperador's leaving the group, since the stock is currently flying high and the firm is making good business here and abroad, despite the pandemic.
Surprising, yes, but the Honor Roll in the stock market is like that. In business as in life, there are those who lose so that others would win.
Other changes are in the sector indices.Rizal Commercial Banking Corp. ($PSE:RCB) will say goodbye to the Financial index.
The Industrial index will welcome Alsons Consolidated Resources ($PSE:ACR) as it shooos away EEI Corporation ($PSE:EEI), Shakey's Pizza Asia Ventures Inc. ($PSE:PIZZA) and Phoenix Petroleum Philippines Inc. ($PSE:PNX)
The Services index will include Converge and Premier Horizon Alliance Corp. ($PSE:PHA), replacing STI Education Systems Holdings Inc. ($PSE:STI) and Harbor Star Shipping Services Inc. ($PSE:TUGS).
The Holding Firms index will drop Lopez Holdings Corp. ($PSE:LPZ) and insert AbaCore Capital Holdings Inc. ($PSE:ABA), with Property Index will remove Arthaland Corporation ($PSE:ALCO) and D. M. Wenceslao & Associates ($PSE:DMW).
Lastly, the Mining and Oil Index will include Atlas Consolidate Mining & Development Corp. ($PSE:AT), Marcventures Holdings Inc. ($PSE:MARC) and Oriental Peninsula Resources Group Inc. ($PSE:ORE) and drop Century Peak Holdings Corp. ($PSE:CPM).
Note that to be included in this crème’ de la crème’ group is good for business, because certain institutional investors are allowed only to trade in stocks that perform well -- and the barometer of performance is the all-powerful Index.
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