As the Philippine market continues to evolve, there are industries that are expected to thrive every year. Since 2018, the country’s economy has been one of the best in the world to invest in, and is expected to grow over the next decade. That being said, with the effects of the pandemic, it is pertinent that the business sector–which has experienced losses due to the lockdowns–builds momentum towards sustained economic recovery.
If you're considering which businesses and industries to invest in the stock market, here are some of the sectors better positioned to recover faster than others, offering more resilience against any potential headwind.
Fast-moving consumer goods (FMCG)
Kantar’s FMCG Monitor presents insights on the pandemic’s impact on consumer spending, pointing out how a six percent contraction only emphasizes the value of essential goods like instant noodles. With the need for everyday products remaining steady in the market (coupled with the fact that this sector accounts for nearly a quarter of the entire services industry in the country), the FMCG industry–from food retailers to manufacturers–is a strong contender in the stock market.
Another reason to invest in retail is the rise of e-commerce in the Philippines. As convenience, choice, and price are driving factors towards consumers making a purchase, the prevalence of online shopping platforms has allowed for the acceleration of online consumer spending due to the pandemic and various quarantine iterations.
Real Estate Investment Trusts (REITs)
Given the relative growth and stability of the outsourcing industry, such as IT service providers, digital marketing companies, and other remote business services, offices and commercial spaces have always been one of the top contributors of the economy. As more businesses around the world undergo digital transformation, the need for cost-efficient measures, like outsourcing their operations, has provided opportunities in the Philippine market. This emphasizes the opportunity found in REITs, or Real Estate Investment Trusts, such as Ayala Land, Inc’s AREIT.
As more properties are leased and rented for growing business opportunities, a real estate investment, such as a REITs, offers recurring income through the collection of rentals and other fees from their tenants.
With the steady growth of outsourcing companies, you can expect an increase in available jobs. Experts note that outsourcing services in the country will continue to cover ten to fifteen percent of the global market in the next couple of years, with a projected annual growth rate of nine percent. As many international countries are looking to the Philippines to provide quality skilled labor for cost-efficient operations, outsourcing will most likely continue to grow and thrive. This bodes well for the real estate industry, which makes REITs a valid potential investment option.
Industrial and manufacturing
Given the foreign investors, the various construction projects across the country, and the government’s own Build, Build, Build Program increasing the spending on infrastructure, the industrial and manufacturing sector does get a boost, albeit a parcel of it. Manufacturing alone contributes 25% of the country’s whole gross domestic product.
Invest in a UITF if you’re still unsure
Of course, investing in a specific industry is easier said than done. Indeed, there are plenty of opportunities in the local market, but it can be taxing for the everyday person to monitor and keep track of every business sector that is thriving. That said, how does one decide which exact business to invest in?
There’s always the option to invest in a Unit Investment Trust Fund or UITF. Instead of directly investing in the stock market, you allow our investment professionals to make the most of your money through the different investment instruments available in the market–including the stock market. The Metro Equity Fund is an example of a UITF that you can explore.
So, if you’re still uncertain where to invest, you’re in good hands with our UITF, as you have someone with years of experience helping you make the best decision. With the volatility of the economy still largely impacted by the pandemic, choosing the right industry to invest your hard-earned money in can be tricky, especially when you’re new to investing instruments.
For first-time UITF investors, discover Metrobank UITF products and visit the nearest Metrobank branch or head to https://metrobank.com.ph/invest/uitf to learn more. Existing investors can visit Metrobank Online (MBO) to further diversify your investments. Contact us today for any questions or inquiries.
