MANILA (XFN-ASIA) - HSBC said the Philippines has the ''most overvalued'' stock market in Asia, even as the economy is expected to grow at an unimpressive rate of 4.7 percent this year.
In its Pan-Asian Equity Strategy report, HSBC said the Philippine equities market has been pushed up by a few expensive stocks such as San Miguel Corp and Ayala Land Inc, the country's largest food and beverage firm and property developer, respectively.
However, shares of Philippine utilities and energy firms are the cheapest in the region, it added.
''The Philippines is a surprisingly expensive market, on a forward price-to-earnings ratio of 13.1 times and price-to-book ratio of 1.9 times,'' HSBC said.
''On our dividend discount model, the Philippines is the most overvalued market in the region.''
The bank said the Philippines has always been expensive, with its five-year average price-to-earnings ratio at 13.7 times.
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