Guosheng Securities issued a research report initiating coverage on FIRST PACIFIC (00142) with a "Buy" rating, citing the synergistic development of its diversified businesses and prominent growth resilience. The company's core operations are strategically focused on essential consumer sectors, positioning it as a leading investment management firm in the Asia-Pacific region. It has established a formidable competitive advantage across Indonesia and the Philippines, primarily within four key segments: consumer food, telecommunications, infrastructure, and natural resources. This cross-sector portfolio effectively creates a risk-hedging mechanism. The main viewpoints from Guosheng Securities are outlined below.

Leading the Asia-Pacific market with a focus on essential industries: 1) Historical Review: As a premier investment management company in the Asia-Pacific, FIRST PACIFIC's development over more than four decades can be segmented into four distinct phases: diversification exploration, focus on essential consumer sectors, industrial integration, and strategic deepening. A leader in cross-sector investment management, the company has consistently deepened its presence in the Asia-Pacific consumer market, with its four main business lines encompassing consumer food, telecommunications, infrastructure, and natural resources. 2) Management Overview: The company's controlling shareholder is the Salim Group, a renowned diversified multinational conglomerate. The management team, led by Mr. Anthoni Salim (Lin Fengsheng) and Mr. Manuel V. Pangilinan (Peng Zeren), possesses profound cross-industry experience and demonstrates highly efficient teamwork. 3) Financial Performance: In 2024, the company achieved revenue of $10.057 billion, a decrease of 4.31% year-on-year, while attributable net profit reached $600 million, marking a significant increase of 19.77% year-on-year, highlighting its robust profitability and stable operational performance.

A robust multi-business layout setting benchmarks across the board: 1) Consumer Food: This segment holds a leading industry position with outstanding competitive advantages. The consumer food business is primarily driven by Indofood, in which FIRST PACIFIC holds a 50.1% economic interest, and is organized into four main divisions: branded consumer goods, flour, agribusiness, and distribution. As a global leader in instant noodles, Indofood leverages its high brand recognition and extensive distribution network across Southeast Asia to achieve steady growth. Its 2024 revenue was $7.29 billion, down 0.65% year-on-year; its profit contribution to the FIRST PACIFIC group was $333 million, an increase of 16.91% year-on-year. 2) Infrastructure: Benefiting from favorable market conditions, this segment exhibits strong growth across multiple areas. The company's infrastructure business is diversified across various sectors and is primarily operated by MPIC, in which it holds a 49.9% economic interest. MPIC reported consolidated revenue of $1.3 billion in 2024, up 19% year-on-year; its profit contribution to the FIRST PACIFIC group was $199 million, an increase of 24.78% year-on-year. The power segment is managed by the Philippine leader Meralco and Singapore's power company PLP; water services are primarily handled by the Philippine market giant Maynilad Water; toll roads are mainly operated by MPTC, which is continuously expanding its transportation network; the remaining operations fall under healthcare and other sectors. In 2024, major sub-segments achieved varying degrees of growth, indicating promising future prospects. 3) Telecommunications: Supported by a stable user base and driven by cutting-edge technology. The telecommunications business is centered on the Philippine leading operator PLDT, in which FIRST PACIFIC holds a 25.6% economic interest. PLDT's profit contribution to the FIRST PACIFIC group in 2024 was $149 million, up 3.70% year-on-year. Its operations are managed by three key companies: Smart (mobile communications), ePLDT (ICT solutions), and Maya (digital financial services). The telecommunications segment contributed 19.12% to the group's profit in 2024, and future growth potential is expected to be enhanced through digital services and 5G network expansion. 4) Natural Resources: Focused on gold and copper development, with steady progress on new projects. The mining operations are managed by Philex Mining, in which FIRST PACIFIC holds a 31.2% economic interest, focusing on gold and copper mining. Its profit contribution to the FIRST PACIFIC group in 2024 was $5 million, a decrease of 36.84% year-on-year, although a significant increase in production capacity is anticipated in the future.

Risk warnings include a potential decline in profitability, intensifying industry competition, operational and policy risks in emerging markets, currency exchange rate fluctuations, and risks associated with trade protectionism and friction.