• Disappointed condominium unit buyers (again)


    Emeterio Sd. Perez

    My apology to the readers of The Manila Times who emailed me their concerns regarding some issues that I have written about in this space. To those who have complaints against condominium developers, I suggest they write directly to the Housing and Land Use Regulatory Board (HLURB).

    Hopefully, HLURB would act on such complaints from condo buyers. If not, Due Diligencer is open to suggestions. Maybe, it is time to expose the penchant of some, or a few property developers, for making an unfair amount of money at the expense of their buyers.

    Will HLURB listen or even acknowledge letters from condominium unit buyers?

    I don’t have the answer. As a matter of fact, I know HLURB only as a regulatory authority. I need not research on it and its functions; its name alone suggests what it is and what it should do. If it fails to perform its duties well, housing and condominium unit buyers will have no other recourse but to accept their fate and charge the loss of their hard-earned money to experience.

    I have had my share of gripes against SM Development Corp. (SMDC), which is owned by businessman Henry Sy Sr. and his family. As a matter of fact, a few readers reacted to a piece I wrote on Aug. 23, 2015, titled “Buying an SMDC condo unit is not always fun.” They expressed disappointment over their acquisitions of the condominium units. (If interested to read the article, access www.manilatimes.net for Due Diligencer.)

    Higher-priced than others

    Lito Anda, a reader of The Manila Times, asked in an email why “conglomerates are not born equal.” The phrase in quotations marks is his. His letter follows:

    “I am just wondering why investors give more premium to the stock prices of some conglomerates and only give discounts to the prices of others.

    “For example in the property sector, SMPH (SM Prime Holdings Inc.) and ALI (Ayala Land Inc.) command a market [price]of four times their book values, while CPG (Century Properties Group Inc.), MEG (Megaworld Corp.) and VLL (Vista Land & Landscapes Inc.) are priced even lower than their book values.
    “That’s not all.

    “When it comes to PE (price earnings) ratios the two conglomerates are way ahead of their peers. The PE ratios of SMPH and ALI are at least 30 while that of CPG, MEG and VLL is below the standard PE ratio of 15. CPG even got only 4 PE ratio while VLL has only less than 8 and MEG has less than 12. I am really wondering why.

    “Does the market perceive the SYs and the AYALAs as more trusting [confident]that they can grow their businesses and be more stable than the Antonios, Tans and Villars? Can you shed some light on these glaring differences?

    “On the other hand, is it now the best time to accumulate stocks [in the companies owned by the]Antonios, Tans and Villars while they are still at bargain levels (that is, applying Warren Buffet’s value investing principle)?
    Or just go with the crowd because those are what they value more? When it comes to experience in running their businesses, the other three are not left behind. They are also great and damn serious. But why is that so? Even their characters are well respected in the industry.

    Due Diligencer responds:

    I am sorry to disappoint Mr. Anda. Although I have emailed him back to say I would answer his questions, I have to admit I am not in a position to analyze the stocks he mentioned. I am not a stock analyst.

    As a reporter, I write pieces based on disclosures posted by listed companies on the website of the Philippine Stock Exchange. When I need more information about the corporate stockholders, I go to the Securities and Exchange Commission to do my own research, which, incidentally, is very expensive.

    Perhaps, the investing public should also make its own study before investing in any listed stock. The individual public investor could start looking at the fundamentals of each of the stocks included in the computations of the PSEi, or the Philippine Stock Exchange Index, by accessing www.edge.pse.com.ph.

    My response here to Mr. Anda may have deviated from what he had expected. Here is a question for him: has he monitored the daily transactions involving the shares of the companies he mentioned? If so, he would know who among the company insiders are either buying or selling listed shares.

    Mr. Anda may want to scrutinize the ownership of companies that are only listed but may not be public. By doing as suggested, he may learn why the SEC decided on requiring listed companies to allocate a minimum of only 10 percent, and not 30 percent, of their shares to public ownership.

    Having covered the SEC and the stock market for decades—I recently celebrated with the members of the “Thursday Media with Friends” my 70th birthday—I know why the SEC pegged the minimum public ownership at 10 percent and not 30 percent. Do I need to tell Mr. Anda and other readers why? Just asking.



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    1 Comment

    1. Does it really matter to them if the price of their stocks are much lower than the others? Do they care about the investing public?