Capital Markets
From The Report: Peru 2014
View in Online Reader
While the Lima Stock Exchange (BVL) may have fallen short of expectations in terms of new issuances in 2012, its overall performance was solid, with the General Index up 5.9% over the previous year. Though market capitalisation and negotiated volumes dropped from 2012 to 2013, most analysts are positive in their outlooks for the near future. Private equity is expected to continue to grow in the coming years, given the relative shortage of high-return investment opportunities in the US and Europe. The current trend of Peruvian corporate bond listings abroad seems likely to continue, with demand remaining strong and investment banks maintaining an interest. Expansion and diversification of the BVL are also expected in the coming years as the government implements a series of reforms aimed at increasing listings, facilitating new financing structures and attracting investors. This chapter contains interviews with Francis Stenning, CEO of the BVL, and Luis Valdivieso, President of the Pension Fund Administrators’ Association.
Articles from this Chapter
No place like home: Convincing Peruvian firms to seek financing domestically is a key goal
OBG talks to Francis Stenning, CEO, Lima Stock Exchange (Bolsa de Valores de Lima, BVL)OBGplus
Interview:Francis Stenning The BVL is dominated by mining companies. How can other industries be encouraged to list? FRANCIS STENNING: Peru has traditionally been a mining country, so it is only natural that the exchange has a strong presence of mining firms. As the economy develops and diversifies, we see it as an equally natural process that the exchange will develop and diversify as well. And while we see this as a natural evolution, we also realise it is our responsibility to facilitate…
OBG talks to Luis Valdivieso, President, Pension Fund Administrators’ Association (AFP)OBGplus
Interview:Luis Valdivieso How would you rate the effectiveness of the AFP reforms as they stand? What could be improved? LUIS VALDIVIESO: It is too early to quantify the net gain from the AFP reforms because while they have brought benefits, they also contain complexities, and these have caused some confusion. On the positive side, commissions have declined by an average of 8%. The reforms have tried to expand coverage and reach groups not previously covered by the pension system, and the…
Alternative arrangements: The government aims for diversification and expansion of the marketOBGplus
In comparison to neighbouring bourses in Chile and Colombia, the Lima Stock Exchange (Bolsa de Valores de Lima, BVL) is a minor player in terms of both market capitalisation and volume traded. Despite top performing stocks in retail and finance, the BVL remains highly concentrated in mining, which accounts for 41.5% of total market capitalisation. The government is seeking to address these shortcomings by implementing a series of reforms aimed at expanding and diversifying the BVL. The first of…
Alicorp: Consumer goodsOBGplus
The Company Alicorp is a leading manufacturer of branded products based in Peru, with operations in Argentina, Brazil, Chile, Colombia and Ecuador. It is listed on the Lima Stock Exchange and represents 4.44% of the General Index (IGBVL). The company has over 153 family brands in 16 categories in the consumer goods segment, 14 brands in the food industry and two brands of fish and shrimp feed. Its majority shareholder, the Peruvian Romero family, owns 45.3% of shares. Peruvian pension funds and others represent 29.8% and 24.9% of total shares, respectively. In the consumer goods segment, Alicorp produces margarines, mayonnaise, sauces, biscuits,…
Cementos Pacasmayo: CementOBGplus
The Company Cementos Pacasmayo is a cement company based in Peru, with more than 50 years of operating history producing, distributing and selling cement and cement-related materials, such as concrete blocks and ready-mix concrete in the northern region of the country. Its products are primarily used in construction, one of the fastest-growing sectors of the Peruvian economy in recent years. It also produces and sells quicklime for use in mining operations. Cementos Pacasmayo is the second-largest cement producer in Peru, accounting for more than 22% of total cement sales in the domestic market in 2012. This market is very regionalised, as certain…
Cementos Pacasmayo: CementOBGplus
The Company Cementos Pacasmayo is a cement company based in Peru, with more than 50 years of operating history producing, distributing and selling cement and cement-related materials, such as concrete blocks and ready-mix concrete in the northern region of the country. Its products are primarily used in construction, one of the fastest-growing sectors of the Peruvian economy in recent years. It also produces and sells quicklime for use in mining operations. Cementos Pacasmayo is the second-largest cement producer in Peru, accounting for more than 22% of total cement sales in the domestic market in 2012. This market is very regionalised, as certain…
Edegel: UtilitiesOBGplus
The Company Edegel is the largest power generation company in Peru. It supplies the national grid and has a total installed capacity of 1470 MW, of which 922 MW is thermoelectric capacity. Edegel is controlled by the Spanish electricity company Endesa, which indirectly owns 83% of Edegel’s outstanding shares through Generandes Peru and Endesa Chile. Its Peruvian operation represents 12% of Endesa Chile’s total installed capacity and 16% of earnings before interest, taxes, depreciation and amortisation (EBITDA) in August 2013. The company produced 7691 GWh in 2012, which represents 21% of the country’s national energy production. Its most…
Graña y Montero: ConstructionOBGplus
The Company Graña y Montero (G&M) is the largest engineering and construction company in Peru, with 80 years of operation. G&M has four complementary business segments: engineering and construction (provides specialised services in engineering, civil works, electromechanical construction, building construction and mining contracting), infrastructure (develops energy, mass transport, water and sewage projects, and operates toll roads), technical services (provides operation and maintenance of infrastructure assets, information technology services, and electricity network services) and real estate. G&M’s backlog had risen to $4.6bn…
Graña y Montero: ConstructionOBGplus
The Company Graña y Montero (G&M) is the largest engineering and construction company in Peru, with 80 years of operation. G&M has four complementary business segments: engineering and construction (provides specialised services in engineering, civil works, electromechanical construction, building construction and mining contracting), infrastructure (develops energy, mass transport, water and sewage projects, and operates toll roads), technical services (provides operation and maintenance of infrastructure assets, information technology services, and electricity network services) and real estate. G&M’s backlog had risen to $4.6bn…
Minsur: MiningOBGplus
The Company Minsur was established in 1977 and is the sole tin miner in Peru as well as the developing world’s largest tin producer (29,528 tonnes in 2012, or 14% of total global output), after Chinese Yunnan Tin and Indonesian Timah. Minsur is also the largest provider of tin to the US. Tin is used in industries such as electronics and construction, as a solder for joining electric circuits and pipes. The company operates the San Rafael mine in the Puno region (in the south of Peru) and Funsur, a tin smelter and refinery in the Ica region (south of Lima) that produces 40,000 tonnes per year. The company also has other operations: Mineração…
Volcan Compañía Minera: MiningOBGplus
The Company Volcan is a significant global producer of silver, zinc, copper and lead. It is the fourth-largest producer of zinc and silver worldwide and is currently the top producer of silver, zinc and lead concentrates in Peru. The company is engaged in the exploration, exploitation, and beneficiation of minerals, solely and through subsidiaries that perform extraction, concentration, and processing activities. The miner’s operations are mainly established in the central Peruvian region of Junin. Accounting for reserves and resources, the combined life of Volcan’s mining operations is 40 years. The company owns three operating units: Yauli…
Volcan Compañía Minera: MiningOBGplus
The Company Volcan is a significant global producer of silver, zinc, copper and lead. It is the fourth-largest producer of zinc and silver worldwide and is currently the top producer of silver, zinc and lead concentrates in Peru. The company is engaged in the exploration, exploitation, and beneficiation of minerals, solely and through subsidiaries that perform extraction, concentration, and processing activities. The miner’s operations are mainly established in the central Peruvian region of Junin. Accounting for reserves and resources, the combined life of Volcan’s mining operations is 40 years. The company owns three operating units: Yauli…
