Happy Monday, Barkada --
The PSE closed up 170 points (!!) to 7290 ▲2.4%.
Hard not to get distracted by what's happening in crypto right now, and by what's happening in the US. I'll admit that I was rubbernecking on Twitter for the back half of last week, but I'm back now; I'm better. (Checks Twitter again.) Maybe I'm not completely cured yet.
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COVID Update
WW: 90063482 PH: 485784 Top 3 MB indices:
Telco ▲4.23% #COVID-19 ▲2.98% POGO Prop. ▲2.70% Bottom 3 MB indices:
Media ▼1.27% Logistics ▼0.43% MiddleClass ▼0.44% Main stories covered:
[NEWS] SquidPay [PHA 1.65 ▲17.02%] to add crypto buy and sell on its platform next month... SquidPay’s (Twitter post)[https://twitter.com/SquidpayP/status/1348185657076633600] said that it would allow users to buy and sell “major cryptocurrencies” with “reasonable fees and instant settlement”, starting this February 14th.
- MB: “Happy Valentine’s Day, babe! I got you ₱2000 worth of Bitcoin through SquidPay as an enduring token of our love... yeah, SquidPay... you know, SquidPay, it’s like this payment platform... how am I supposed to know when they’ll actually complete their backdoor listing? BABE, WHY ARE YOU BEING SO DIFFICULT?!”" ">- [MB:] “Happy Valentine’s Day, babe! I got you ₱2000 worth of Bitcoin through SquidPay as an enduring token of our love... yeah, SquidPay... you know, SquidPay, it’s like this payment platform... how am I supposed to know when they’ll actually complete their backdoor listing? BABE, WHY ARE YOU BEING SO DIFFICULT?!”
- MB: /www.philstar.com/business/2021/01/10/2069324/jollibee-expands-north-america]”, despite the pandemic, in stark contrast to how JFC stores performed domestically amid our lengthy lockdown and confusing soup of movement restrictions.
[NEWS] Jollibee [JFC 192.50 ▼0.05%] grows its footprint in the US and Canada... JFC plans to build 19 new stores in the US and 9 in Canada. JFC said that its stores in North America actually experienced “(double-digit sales growth)[https://www.philstar.com/business/2021/01/10/2069324/jollibee-expands-north-america]”, despite the pandemic, in stark contrast to how JFC stores performed domestically amid our lengthy lockdown and confusing soup of movement restrictions.
- MB: If your thesis includes the assumptions that pandemics are going to be a problem for 2021 and maybe for the foreseeable future, it makes sense to diversify jurisdictions. The PH locked down hard and that crushed fast food, but the US and Canada did not lock down in the same manner, and where lockdowns did occur, delivery/drive-through/pick-up infra was already in-place to support continued sales. If anyone has ever seen the lines that foreign-based JFC locations can generate, they’d see why these stores are (usually) no-brainers.
[NEWS] Globe [GLO 2020.00 ▲1.00%] takes investment in GCash operator at $1bn valuation for GCash... Mynt, GLO’s fintech subsidiary that owns and operates GCash, (took $175m from a fund managed by Bow Wave)[https://www.rappler.com/business/gcash-operator-now-worth-almost-1-billion-after-bow-wave-investment], a New York-based venture capital firm that invests in “early-stage companies that provide online and mobile payment processing, banking and complementary financial services”. The investment values GCash at $1 billion USD (₱46bn), which would give the fintech startup “(unicorn status)[https://en.wikipedia.org/wiki/Unicorn_(finance)#:~:text=A%20unicorn%20is%20a%20term,rarity%20of%20such%20successful%20ventures.]”.
- MB: While this is great for GCash and great for GLO, and it’s also a great sign that GLO will eventually contemplate the listing/spin-off of GCash through an IPO or similar event. Investors like Bow Wave usually give great sums of money with the understanding that, at some point, they’ll be able to cash-out at a good return. Usually, the best way for a company offload a significant minority stake is through an IPO. Think of Pincus with Converge [CNVRG 15.70 ▲2.08%] earlier this year. I’m not sure of this deal’s contemplated time-frame. Could be one year, could be three. Usually depends on the market itself. Companies don’t want to feed the ducks (us) unless we’re quacking (buying).
[NEWS] SpaceX in talks with PH Gov’t to provide Starlink internet service by Q3 of this year... the space exploration company, owned by Elon Musk, has been beta testing its satellite-based internet broadband service and is interested in expanding its offering to a fairly wide selection of countries, (including the Philippines)[https://mb.com.ph/2021/01/02/koko-ph-to-benefit-from-starlink-broadband-project/]. Senator Koko Pimentel met with representatives from SpaceX, to discuss “constitutional and other legal requirements in terms of protection and the ability of the Philippine government to engage with SpaceX”.
- MB: The nitty gritty details are not there yet, but (CNBC has info)[https://www.cnbc.com/2020/10/27/spacex-starlink-service-priced-at-99-a-month-public-beta-test-begins.html#:~:text=Called%20the%20%E2%80%9CBetter%20Than%20Nothing,and%20a%20Wi%2DFi%20router.] to say that the service may be priced at US$99/mo, plus a US$500 up-front charge for the Starlink connectivity kit. SpaceX set low performance expectations for its beta test, saying to potential testers: “Expect to see data speeds vary from 50Mb/s to 150Mb/s and latency from 20ms to 40ms over the next several months as we enhance the Starlink system”. No word yet on the post-beta speeds and latency, but I know many non-NCR businesses that are currently playing PLDT [TEL 1424.00 ▲5.48%] about the same amount per month for about the same service. A satellite-based solution like this might be an important part of the country’s connectivity plan considering the vast (and expensive) challenge of wiring and connecting our nearly eight thousand islands. Perhaps this is not a solution for dense population centers like the NCR or Cebu, where TEL, Converge [CNVRG 15.70 ▲2.08%], and Globe [GLO 2020.00 ▲1.00%] should be positioned to provide better service at a more efficient price-point, but it is definitely a “Player 2 has entered the game” moment for the provincial areas that have been begging for proper connectivity for years. It also provides companies and individuals with a realistic backup for connectivity in disaster and business continuity situations.
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