CBC, AREIT heavy index favorites

Pundits are placing their bets on China Banking Corp. (CBC) and AREIT Inc. to barge into the Philippine Stock Exchange index (PSEi) in next month’s market rebalancing as their full market cap, which is based on the 12-month value weighted average price (VWAP), place them in the 24th and 25th spot, respectively.

This would in turn result in the forced exit of Wilcon Depot and Nickel Asia Corp. as they are the two index constituents with the lowest full market cap at 32nd and 34th place, respectively.

The potential inclusion of CBC in the rebalancing could significantly enhance the bank’s stock performance by attracting increased investor interest and trading volumes, according to Regina Capital Development Corp. (RCDC).

CBC’s strong financial performance, characterized by consistent asset growth, profitability, and strategic initiatives in digital transformation and sustainability, positions it as a prime candidate for inclusion.

This development would improve CBC’s market visibility, boost its liquidity, and provide greater flexibility for future capital-raising activities of the bank.

The entry of CBC and AREIT reflect the evolving composition of the PSEi to include companies with robust growth potential, RCDC indicated.