John Gokongwei's large disposal of stocks triggers 1% plunge in PSE share prices

The large disposal of shares by one of the country's richest people — John Gokongwei Jr., chairman emeritus of JG Summit Holdings Inc.'s (JGS) — caused the share prices on the Philippine Stock Exchange to plunge more than one percent on Thursday.

"JGS was the cause of the huge drop in stock prices which affected other conglomerates. Of the 87.6 points that the PSEi lost today, 54 points of it came from JGS' decline," said Jonathan Latuja, research analyst at Unicapital Securities Inc.

According to JG Summit senior vice president and chief strategist BJ Sebastian, the sale was for estate planning purposes.

"This is his (Gokongwei) way of dividing his wealth for the inheritance of his children," Sebastian added.

At closing, JGS' last trade price dropped 8.80 points or 9.65 percent to P82.40 per share from P91.20 on Wednesday.

The conglomerate's stock price drop was attributed to Gokongwei's secondary sale of his 142.5 million shares at P82.10 a piece, worth a total of around P11 billion, or $250 million. This was discounted by more than 10 percent from its price guidance. 

The benchmark PSEi lost 87.57 points or 1.17 percent to 7,376.38 at the closing bell.

The broader All Shares fell 40.45 points or 0.91 percent at 4,416.88. More than 1.895 billion shares valued at P18.635 billion, changed hands. Decliners led advancers, 109 to 65, and 56 issues were unchanged. — VVP, GMA News