PASAY CITY — SM Investments Corp (SMIC) has announced a strategic shift towards expanding its operations in provincial areas, aiming to distribute the Philippines' economic growth more evenly across the country.
According to Philippines News Agency, speaking at the company's annual stockholders' meeting, there is a noticeable gap in modern retailing, banking, and integrated property services outside of Metro Manila. "Our strategy is to broaden our nationwide coverage, creating new markets and enhancing accessibility and inclusivity in these sectors to address these disparities and generate more opportunities in underserved areas," DyBuncio explained in a recorded report.
SMIC's senior vice president for finance, Franklin Gomez, revealed on the sidelines of the meeting that the company plans a capital expenditure (capex) of between PHP110 billion and PHP120 billion for this year, not including its banking sector investments. This is a significant increase from the PHP80 billion capex in 2023. The majority of this year's capex, around PHP100 billion, is allocated to SM Prime Holdings, Inc., for developing integrated properties nationwide.
This year, SM Prime is set to open four new malls in the National Capital Region and three in provincial locations. Additionally, SM Development Corp. aims to launch 8,000 to 10,000 residential units across northern Philippines and in the regions of Visayas and Mindanao in 2024. Meanwhile, the SM minimart grocery chain, Alfamart, is looking to inaugurate at least 400 new stores.
The banking segment of SMIC, which includes BDO and BDO Network Bank, plans to expand by opening 100 to 120 new branches across the country. "The provincial areas are experiencing faster growth than the National Capital Region. We are directing a significant portion of our investments to these areas, anticipating that this will also bolster our growth as economic activities increase," Gomez stated.
Following its acquisition of the Philippine Geothermal Production Company, SMIC aims to double its steam production from the current 300 megawatts in the medium term. Moreover, its 2GO Group, Inc. has added two new ships this year to enhance connectivity and logistics across the islands.
SMIC chairman Amando Tetangco Jr. emphasized the importance of logistics and renewable energy to the company's long-term investment strategy, aiming for mid-teen returns. "Effective logistics are crucial for ensuring that economic growth extends beyond Metro Manila and benefits the entire country," said Tetangco, a former central bank governor.