Village Connect
SM Investments Corporation, the parent company of the SM Group, is expressing strong confidence in the Philippines’ economic trajectory. Erwin G. Pato, Executive Vice President for Treasury, Finance, and Planning, emphasized the company’s commitment to supporting the country’s growth during recent discussions with CNBC and Bloomberg.
In these interviews, Mr. Pato outlined SM Investments’ optimistic outlook on the nation’s economic potential. He noted that the group’s diversified investments in retail, property, and financial services will play a significant role in driving the consumption-led growth that characterizes the Philippine economy.
A major highlight from SM’s recent activities is the announcement of a PHP60-billion share buyback program, which stands as the largest in Philippine corporate history. This strategic move not only reflects the company’s faith in its own valuation but also underscores its positive forecasts for the Philippine economy.
The decision to repurchase shares worth about USD1 billion signifies a strong belief in sustained value appreciation amidst an optimistic economic backdrop. “We’re initiating this buyback because we have confidence in our company’s potential for growth,” stated Mr. Pato. He further elaborated, “The Philippine economy is predominantly consumption-driven, contributing around seventy percent to our gross domestic product (GDP).
Our businesses within retail, integrated property development, and financial services are well-positioned to capitalize on this trend.” In terms of financial performance, SM Investments reported a consolidated net income growth of 7% for 2024, reaching PHP82.6 billion, up from PHP77.0 billion in the previous year.
SM Retail Inc., the group’s retail division, also demonstrated promising growth with a net income of PHP20.9 billion, an increase from PHP19.9 billion in 2023. “We serve as a barometer for the Philippine economy, given our extensive reach and the communities we engage with,” Mr. Pato explained. “With interest rates on the decline, we anticipate this will enhance our macroeconomic situation and may enable our economic policymakers to maintain inflation within the 2% to 4% range. If this occurs, it would provide considerable support for consumer spending.”
As a leading player in the property sector, SM Prime Holdings, Inc. is set to invest PHP100 billion this year in developing various projects, including malls, residences, offices, hotels, and convention centers. This substantial investment is driven by expectations of continued consumer demand and robust corporate activity, cementing SM’s role in shaping the future of the Philippine economy.
