By Revin Mikhael D. Ochave, Reporter
LISTED CONSUMER GOODS companies may see a boost in their bottom line this year as demand is expected to increase ahead of the May elections, analysts said.
AP Securities, Inc. Research Head Alfred Benjamin R. Garcia said the likely increase in sales of fast-moving consumer goods during the campaign season would lift earnings of companies such as Jollibee Foods Corp., Puregold Price Club Inc., Universal Robina Corp., and Monde Nissin Corp.
“Historically, we tend to see higher spending on consumer goods during election years,” he said in a Viber message.
“This is more pronounced during presidential elections, but the effect is still there to a lesser extent during midterms,” he added.
Luna Securities, Inc. Research Officer and Market Strategist Annika Gabrielle S. Angeles said other companies also seen to benefit from the May elections include San Miguel Food and Beverage, Inc., Century Pacific Food, Inc., RFM Corp., and Emperador, Inc.
“Elections, both national and midterm, typically serve as a boost to the consumer sector. Power usage is also likely to rise due to heightened campaign activities,” she said in a Viber message.
Midterm elections are scheduled for May 12, when Filipinos will elect senators, congressmen and local officials.
The election period officially began on Jan. 12, but the 90-day campaign period for national candidates will start on Feb. 11. For local bets, the campaign period will begin on March 28.
“Midterm elections tend to boost the economy primarily due to the massive amount of campaign spending,” China Bank Capital Corp. Managing Director Juan Paolo E. Colet said in a Viber message.
“This should benefit a number of listed companies, particularly those in the consumer sector,” he added.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message that consumer demand will likely get a boost during the election period.
“We could see increased demand for election-related materials such as posters, advertisements, food, beverage, transportation, accommodation facilities, venues, events-related, and other logistical requirements,” he said.
“These would all entail the creation of more jobs and other economic activities that would also translate to higher sales for some local companies,” he added.
Government spending on infrastructure will also likely accelerate ahead of the ban on public works which starts 45 days before the elections. Social welfare dole-outs are also prohibited during the period.
“The possible increase in government spending is also a source of additional growth for the local economy, since the voters look for accomplishments as basis for choosing candidates, both new and incumbent officials running for the midterm elections,” Mr. Ricafort said.
Meanwhile, Ms. Angeles said the outcome of the midterm elections could impact market sentiment.
“The midterm elections can influence broader market sentiment, with investors adjusting their expectations based on potential policy changes, such as tax reforms or infrastructure investments,” she said.
Mr. Colet said the local stock market will keep a close eye on the outcome of the midterm elections and its implications on governance and political dynamics for the second half of President Ferdinand R. Marcos, Jr.’s term.
“A strong win for the Marcos ticket would imply policy continuity and administrative stability, so that should be generally positive for stocks,” he said.
“The momentum of President Marcos’ reform agenda will require a solid coalition in both the Senate and House to ensure the passage of important economic bills and initiatives,” he added.
