MWC crashes to record low on heavy selling

Shares of Manila Water Co. crashed to record low levels on Tuesday, even falling below its initial public offering (IPO) price in 2005, as investors scrambled to sell their shares as water concession contracts with the government are now in limbo.

MWC’s share price plunged by 35.76 percent to close on Tuesday at P6 a share, the lowest level seen since it went public in 2005 and sold shares to the public at P6.50 a share.

The Ayala-led water utility is now valued by the stock market at P19.28 billion. Just last Dec. 2 or before President Duterte ranted against MWC and Maynilad Water Services Inc., MWC was valued at P39.29 billion.

“MWC’s stock is drowning from overwhelming regulatory concerns,” said Astro del Castillo, managing director at First Grade Finance.

MWC’s valuation in the stock market has shrunk to a third of its valuation 11 trading days ago.

Shares of DMCI, a strategic investor at Maynilad, fell by 2.52 percent to close at P5.41 per share, giving it a market capitalization of P73.69 billion.

On the other hand, shares of MWC’s parent conglomerate Ayala Corp. and Maynilad’s parent company Metro Pacific Investments Corp. rebounded by 1.06 percent and 4.59 percent, respectively.

The Department of Justice said on Tuesday that the government was still considering the concessionaires and may just renegotiate their contracts.

Overall, the Philippine Stock Exchange index (PSEi) added 28.85 points or 0.38 percent to close at 7,730.45. INQ