Capital Markets
From The Report: Peru 2017
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The Peruvian stock exchange, the Lima Stock Exchange (Bolsa de Valores de Lima, BVL), had a boom year in 2016, achieving one of the highest rates of return in the world. The main index, the Standard & Poor’s (S&P)/BVL Perú General, ended the year at 15,567 points, a gain of 58.1% on the previous year, according to the World Federation of Exchanges. This made it the second-best-performing bourse in the world in 2016, after Egypt. BVL share prices are widely expected to see solid growth in 2017, albeit at a somewhat slower pace than in 2016, as a result of less vigorous performance by mining stocks, as well as some doubts over the underlying strength of the economy as it rebalances towards non-primary sector-led growth.

This chapter features an interview with Marco Antonio Zaldívar, President, Bolsa de Valores de Lima.

Articles from this Chapter

Overview

Up to the task: Reforms and economic growth have been a boon for the bourse
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The Peruvian stock exchange, the Lima Stock Exchange (Bolsa de Valores de Lima, BVL), had a boom year in 2016, achieving one of the highest rates of return in the world. The main index, the Standard & Poor’s (S&P)/BVL Perú General, ended the year at 15,567 points, a gain of 58.1% on the previous year, according to the World Federation of Exchanges (WFE). This made it the second-best-performing bourse in the world in 2016, after Egypt, which gained around 76%. In terms of the general…

Interview

Building growth: Marco Antonio Zaldívar, President, Bolsa de Valores de Lima (BVL), on increasing liquidity volumes
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Interview: Marco Antonio Zaldívar What are the reasons behind the low trading volumes in recent years? MARCO ANTONIO ZALDÍVAR: The decrease in the volume of operations that occurred in 2015 and partially in 2016 can be explained by the fact that participants became more sophisticated and resilient. Due to their size, they are no longer attracted to protected markets such as the BVL. Investors use investment vehicles, such as investment or mutual funds, which do not need the protection of the…

Analysis

Alicorp: Consumer goods
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Grupo Romero’s Alicorp is the largest consumer goods company in Peru. Over the approximately 60 years it has been in business, Alicorp has grown through several merger and acquisition transactions with other local firms. The company currently has clear market leadership in most of the key categories it competes in. Alicorp’s revenue comes mainly from five countries – Peru, Argentina, Brazil, Chile and Ecuador – and, to a lesser extent, from exports to other regions. At present, Peru contributes slightly more than 60% of total sales, which is down from 100% about 10 years ago. Alicorp’s controlling group is the Romero family,…

Analysis

Alicorp: Consumer goods
OBG
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Grupo Romero’s Alicorp is the largest consumer goods company in Peru. Over the approximately 60 years it has been in business, Alicorp has grown through several merger and acquisition transactions with other local firms. The company currently has clear market leadership in most of the key categories it competes in. Alicorp’s revenue comes mainly from five countries – Peru, Argentina, Brazil, Chile and Ecuador – and, to a lesser extent, from exports to other regions. At present, Peru contributes slightly more than 60% of total sales, which is down from 100% about 10 years ago. Alicorp’s controlling group is the Romero family,…

Analysis

Still strong: Real estate presents a major investment opportunity
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Over the past five years growth in the real estate sector has outpaced that of the economy as a whole, driven by increasing household income levels; pent-up demand, particularly among middle- and middle-low-income households; greater access to mortgages due to lower interest rates; and state housing programmes such as the My House fund. However, in 2016 a number of factors affected the performance of the real estate sector, including stricter conditions for mortgage loans, especially for lower-income applicants; a slowdown in employment growth; a three-year decline in private investment; and a depreciation of the exchange rate, thereby…

Analysis

Expanding bond: Government bonds
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With a rating of “BBB+/A3”, Peru has solid economic fundamentals to support its bond market. The country is a leader in terms of economic growth in South America, has strong macroeconomic balances, low public debt, a robust financial system, low country risk metrics and a broad portfolio of infrastructure projects. Emerging Appetite Despite the recent downward trend in GDP, the bond market has benefitted from the increased appetite of investors for emerging markets. Institutions such as the World Bank and Moody’s credit ratings agency have highlighted a change in direction of investment flows in international fixed-income markets.…

Analysis

Southern Copper: Mining
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Southern Copper Corporation is an integrated copper producer with mining, smelting and refining facilities located in Mexico and Peru. The company’s main products are copper, molybdenum, zinc and silver. Southern Copper has exploration activities in Argentina, Chile, Ecuador, Mexico and Peru. Originally known as the Southern Peru Copper Corporation, the firm was incorporated in Delaware, US in 1952 and has conducted mining operations since 1960. In 2005 the company was renamed Southern Copper Corporation. Southern Copper is controlled by Americas Mining Corporation (AMC), a fully owned subsidiary of Grupo México. AMC holds an 81.5%…