SUN LIFE Investment Management and Trust Corp. (SLIMTC) is looking to invest more in power, banking and infrastructure amid a bullish profit outlook for these sectors on the back of a supportive operating environment.
SLIMTC manages C$6.2 billion worth of assets as of Sept. 30. It is part of Sun Life of Canada’s businesses in the Philippines, along with life insurer Sun Life of Canada (Philippines), Inc. (Sun Life Philippines), Sun Life Asset Management Company, Inc., and bancassurance unit Sun Life Grepa Financial, Inc.
“We’re looking at outlets to fund, especially more on what the government needs. One is power. I think clearly there’s a lot of need for power, especially more on the transitioning to renewables,” SLIMTC President Michael Gerard D. Enriquez said in an interview at an event earlier this month.
“Transition financing is something that we are looking at. But mostly, we would like to partner more on the renewable side,” he added.
Benedict C. Sison, Sun Life Philippines chief executive officer and country head, said the firm is likewise looking at the infrastructure and banking sectors.
“The bottom line is we’re very optimistic about the Philippine economy,” Mr. Sison said.
A SLIMTC presentation to a visiting Canadian trade mission earlier this month showed that they see the banking, power, utilities, and transport sectors driving the Philippines’ growth momentum as these sectors are expected to remain profitable.
For banks, it said that the recent cut in reserve requirement ratios and double-digit loan growth are expected to temper the expected narrowing in their margins following cuts to benchmark interest rates.
“There is scope to boost growth further through the tapping of the consumer sector, though NPLs (nonperforming loans) should be watched,” it said.
Meanwhile, the energy sector’s profitability will be driven by “power demand growth, easing interest rates, and ongoing expansion plans,” SLIMTC said.
“Risks to the outlook may come in slower power demand on global growth slowdown contagion and project level execution risks.”
Jaime Antonio Lopez, investment research director at SLIMTC, said energy firms have a lot of “ammunition in terms of in-house equity.”
“They’re looking to expand together with the economy. So, there are a lot of opportunities out there.”
Meanwhile, SLIMTC has neutral outlooks for the profitability of the property, consumer and telecommunications sectors.
It added that the gaming sector is seeing slower growth in revenues amid the absence of large-scale junket operators.
“Mass market and slots segments have offset the loss, but traditional integrated resorts are struggling to grow total GGR (gross gaming revenues) in the absence of the once-swift VIP segment.”
Sun Life Philippines recorded total premiums of P41.93 billion and a new business annual premium equivalent of P6.48 billion at end-September, based on Insurance Commission data. Its net income in the first nine months stood at P7.16 billion. — A.R.A. Inosante
