The Zobel family-controlled Ayala Corporation, the country’s oldest conglomerate, reported that it will be increasing its group-wide capital expenditures (capex) budget for 2024, higher than the P250 billion it actually spent last year.
“We estimated the figure to be higher compared to Ayala Group’s 2023 CAPEX,” stated a company disclosure to the Philippine Stock Exchange (PSE). It added that the 2023 numbers are “closer to P250 billion.”
For the parent company alone, capex for 2024 will likely be flat when compared to its 2023 capex of close to P13 billion.
In an interview, Ayala Chief Finance Officer Alberto M. de Larrazabal said the group will continue to invest heavily in the local economy although some units will be having lower capex budgets while the high-growth businesses will be making bigger investments.
He noted that Ayala Land Inc. is allotting a large budget for refurbishing its malls and resorts in addition to building more upscale residential projects, mixed-use estates, and office buildings.
“You look at BPI (Bank of the Philippine Islands), it's expansionary, but it's not really capex heavy, it's really more around their investments in tech, that will allow them to continue growing the business,” De Larrazabal said.
He added that, “When you think about Globe, their capex per se is dropping significantly. So the new availment this year will be $600 million give or take, as compared to the $1.2 billion to $1.3 billion (in previous years) from a cash perspective.”
“And then you talk about energy and that one's going to be really, really capex heavy. We're going to increase the capacities, attributable capacities from five gigawatts to 20GW in seven years. To put that in context, it took us 10 years to go from zero to 5GW. We're going build from five to 20GW in 7 years. Yeah, that's a really aggressive number,” De Larrazabal said.
On the part of the Ayala parent company level, he said “a lot more capital is being allocated for the new areas, the new areas we're developing. Healthcare, is one, logistics is the other. And then more recently, we started to get into electric vehicles, BYD, that was important to start early.”