Debt Ceiling, Stock Thoughts: VMC, ARA

Debt Ceiling

The date that I am waiting for, March 6, the debt ceiling deadline is moved to May 18.

A good article for those who are interested about it:

http://blogs.wsj.com/washwire/2013/02/04/obama-signs-debt-ceiling-law-now-what/

VMC

Results of annual stockholders meeting:

http://www.pse.com.ph/resource/disclosures/2013/pdf/dc2013-1252_VMC.pdf

VMC has interesting amendments on its articles of incorporation:

  1. Co-generation
  2. Entry to ethanol production
  3. Participation to public-private partnership with the government

Entry of VMC to co-generation is expected but ethanol production and PPP was a surprise.

There are still strong sellers for VMC shares.

ARA

Nice price action for ARA.

https://fundamentalenthusiast.wordpress.com/2013/01/16/araneta-properties-inc-pse-ara/

Don’t confuse it with SLI with SLRDI ok?

https://fundamentalenthusiast.wordpress.com/2013/01/16/slrdi-pse-sli-confusion/

SLRDI/ (PSE: SLI) Confusion

Sta. Lucia Realty and Development, Inc. (SLRDI) is the joint venture partner of ARA in the development of Colinas Verdes properties. The common confusion is investing in Sta. Lucia Land, Inc. (PSE: SLI) for the reason that they have interest in Colinas Verdes.

SLRDI is the parent of SLI thus SLI will derive no economic benefit in SLRDI’s interest in Colinas Verdes.

Kindly see SLI’s annual report:

http://www.pse.com.ph/resource/corpt/2012/SLI_A17A_Dec2011.pdf

In p.16 under the “residential and commercial properties” section notice that you won’t find Colinas Verdes in the list.

Debt Ceiling, Stock Thoughts: ZHI, ARA

Debt Ceiling

An idea on what the scenario will be this coming March:

http://www.abc.net.au/news/2013-01-15/obama-refuses-to-negotiate-debt-ceiling/4466110

US politicians will be faced in the same dilemma again: would they cut government spending and put the US under recession or raise the debt ceiling and let the future bear the burden?

I think we all know the answer, they will do the latter, but it would be a good learning experience for us to see how things will turn out. 🙂

ZHI

A disclosure regarding ZHI:

http://www.pse.com.ph/resource/disclosures/2013/pdf/dc2013-0504_ZHI.pdf

One of the few stocks that only investors with insider information have an edge.

ARA

Wow ARA….

Check it out here:

https://fundamentalenthusiast.wordpress.com/2013/01/16/araneta-properties-inc-pse-ara/

Araneta Properties, Inc. (PSE: ARA)

Araneta Properties, Inc. (the “Company” or ARA) was formerly known as Integrated Chrome Corporation (INCHROME). INCHROME stopped its smelter operations in January 1996.

On January 24, 2005, the Company sold its smelter plant to Platinum Group Metal Corporation (PGMC) for an agreed price of P150 million resulting to a gain of 37.6 million in 2005.

On June 5, 2003 ARA signed a Joint Venture Agreement with Sta. Lucia Realty and Development, Inc. (SLRDI) to develop the Company’s 2,364,082 sq. m. property in San Jose Del Monte, Bulacan. As of December 31, 2011, the Company sold 643,514 sq. m. of developed lots.

Colinas Verdes, ARA’s joint venture project with SLRDI, requires the SLRDI to develop and sell parcels of land owned by ARA at its own cost. The joint venture project shall consist of the development of an exclusive mixed-use residential-commercial subdivision with a country club. ARA shall receive 40% of the net sales proceeds. As of September 30, 2012, Phase I and II are 97% and 98% complete respectively.
Colinas Verdes

Colinas Verdes Google Earth view

Comments:

ARA’s attraction lies mainly on its land bank which is located near the to-be-constructed MRT 7 which if completed, could be 23 km long with 14 stations. The line has been projected running in a northeast direction, traversing Quezon City and a part of Caloocan City in Metro Manila before ending at the City of San Jose del Monte in Bulacan province.

MRT 7 route detail

From: http://ianfabulalim.wordpress.com/2010/05/09/metro-rail-transit-line-7-mrt-7/

SMC confirmed a news article on December 4, 2012 that they are only awaiting for the government’s approval to start the construction of MRT 7. [1]

Other data:

ARA1

Sources:

  1. Clarification of news article: “SMC ready to start MRT 7 construction”, http://www.pse.com.ph/resource/disclosures/2012/pdf/dc2012-8719_SMC.pdf
  2. SEC filings

Disclaimer: I do not claim to be an expert and nothing I say should be taken as a recommendation to buy or sell.