MANILA – Manila Water’s stockholders are likely to stick it out with the utility, as it rides out a supply shortage affecting tens of thousands in the capital, an analyst said Wednesday.
Shares of the Ayala-led water concessionaire rebounded from Tuesday, up 2.39 percent to P25.70 in early trading. The main index was up 0.05 percent.
President Rodrigo Duterte asked the government’s water regulator late Tuesday to submit a report on the shortage by April 7, after which, he will decide whether officials would be fired or concession agreements would be terminated, according to his spokesman.
“A lot of people play the long game with Manila Water. The stock has held up pretty well… I don’t expect material fall on the stock,” BPI Securities research head Haj Narvaez said.
“Obviously, in the near term, some investors are concerned given they don’t have enough supply at the moment,” Narvaez told ANC’s “Market Edge.”
Manila Water handles Metro Manila’s east zone, with the west delegated to unlisted Maynilad Water Services Inc. The water concession was split between the two utilities under a privatization effort in 1997.
Manila Water president and CEO Ferdinand dela Cruz told a House of Representatives hearing last Monday that he was holding himself accountable for the water crisis as he acknowledged the “anger” of affected customers.
During a separate hearing at the Senate on Tuesday, Dela Cruz said Manila Water was looking at a possible “adjustment” in water bills to provide relief to customers affected by the shortage. (ABS-CBN News)