Do Not Read This: Diego Cagahastian from Opinyon
Do Not Read This

Recovery seen in air travel

Oct 13, 2021, 3:44 AM
Diego S. Cagahastian

Diego S. Cagahastian

Columnist

IT IS said that the stock market anticipates what will happen six months from now, at least in the near-term.

The behavior of prices of Macroasia ($:MAC) today, Wednesday, Oct. 13, points to the idea that the airline industry and its allied industries such as tourism, hotels, restaurants, land transport, etc. are on their way to recovery sooner than we think.

It looks like $:MAC is unstoppable from its 4.26 last Oct. 1 to 4.53 last Oct. 4, then to 4.92 last Oct. 6.

Early today, this stock of the Lucio Tan Group was already trading at 5.64 from its open at 5.40.

What gives?

This means the airline industry is recovering, with more and more local and foreign commercial aircraft flying in and out of the airports.

All these airlines depend on Macroasia for their catering needs, aside from repair and maintenance.

You see, Macroasia and Germany's Lufthansa Technik AG, formed this joint venture Lufthansa Tecknik Philippines (LTP) in 1999 to undertake aircraft maintenance, repair and overhaul (MRO) for local and foreign carriers.

The JV operates out of the Ninoy Aquino International Airport, Diosdado Macapagal International Airport, Mactan Cebu International Airport and Davao International Airport.

The LTP was registered with the Philippine Economic Zone Authority (PEZA) as an economic zone locator and this means it enjoys tax breaks and incentives.

LTP also has established a track record in Airbus 380 repair and has completed a Boeing 777 base maintenance capability buildup.

Lately, LTP suffered losses due to the COVID-19 pandemic and had to lay off some workers.But then they decided to ramp up operations again as the airline industry picture is fast turning pink.

So, investors are hurrying to join the $:MAC bandwagon once more, not because of its new ventures into mining, but because of its core operations with the robust recovery being anticipated in the coming one to 2 years.

Feedback is welcome at ports.reports@gmail.com.


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