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PLDT
- Sector: Media and TelecommunicationsTechnologyTechnology Media and Telecommunications
- Sub Sector: Telecommunications
- Country: Philippines
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Fundamental View
AS OF 17 Nov 2025PLDT’s FY24 and 1H25 results were stable as expected; we see a modestly improving FY25 credit outlook aided by resilient EBITDA growth and residual tower sales, which could offset persisting high capex.
A potential stake sale of the data center business could drive further deleveraging.
While the spillover of a PHP 33 bn capex overrun to FY25 could weigh on free cash flows, we draw mild comfort that it was likely not due to fraud but rather a management misstep.
Business Description
AS OF 17 Nov 2025- PLDT is a leading telecom operator in the Philippines, competing alongside its main rival Globe Telecom in a predominant duopoly.
- PLDT provides 2G/3G/4G mobile, fixed-line, broadband, enterprise data, and other digital services to retail and corporate customers.
- PLDT operates through 2 main business segments – “Wireless Services” and “Fixed Line Services”.
- Its “Wireless” segment offers mobile voice, mobile SMS, mobile data and mobile broadband services to retail customers in the Philippines. These services are marketed under the “Smart Postpaid”, “Smart Prepaid”, "Sun Postpaid" and “TNT Prepaid” brands.
- Its “Fixed Line Services” segment provides fixed line voice, corporate data and home broadband services to retail and corporate customers in the Philippines.
- PLDT commercially launched 5G services on a small-scale basis in Jul-2020. It currently has over 3,000 5G sites nationwide.
- PLDT maintains dominant market shares in the mobile, fixed line voice, and the home broadband spaces.
- PLDT is backed by three established corporate groups, namely First Pacific (~15% stake), NTT Corporation (~12% stake) and JG Summit Holdings (~7% stake).
Risk & Catalysts
AS OF 17 Nov 2025Aggressive expansion by new entrant DITO over the next 2-4 years could chew away at PLDT’s market share and restrain recoveries in average revenues per user (ARPU).
PLDT incurs significant capex that has restrained improvements in its leverage metrics and free cash flows. This is worsened by a recent capex overrun that has induced mild corporate governance uncertainties (though these have eased in recent months).
Consistently high dividend payouts could worsen PLDT’s already negative free cash flows.
PLDT is exposed to $/PHP depreciation risks ($300 mn 2050 bond is fully unhedged).
Key Metric
AS OF 17 Nov 2025| PHP bn | FY22 | FY23 | FY24 | 9M24 | 9M25 |
|---|---|---|---|---|---|
| Debt to Book Cap | 71.9% | 73.3% | 74.2% | 74.1% | 74.7% |
| Net Debt to Book Cap | 65.7% | 69.3% | 72.0% | 71.3% | 72.6% |
| Debt/Total Equity | 256.2% | 273.9% | 287.5% | 286.2% | 294.9% |
| Debt/Total Assets | 46.8% | 49.6% | 53.8% | 52.1% | 56.9% |
| Gross Leverage | 2.9x | 2.9x | 3.0x | 3.0x | 3.2x |
| Net Leverage | 2.7x | 2.8x | 2.9x | 2.9x | 3.1x |
| Interest Coverage | 7.4x | 6.5x | 6.1x | 6.2x | 5.5x |
| EBITDA Margin | 48.7% | 49.1% | 51.1% | 51.8% | 52.3% |
CreditSight View Comment
AS OF 03 Feb 2026We downgrade PLDT to Underperform from Market perform. PLDT 2031 trades tight to Globe 2030, ICTSI 2031, Axiata 2030, and Bharti 2030, and we see room for it to widen 15-20 bp. PLDT 2050 also trades tight to other 2050 bonds in SSEA, including Reliance, Pertamina, and PLN. We are comfortable with PLDT’s sturdy credit profile aided by a resilient broadband business, non-core tower sales, and falling capex. Governance fears have also eased post its capex overrun in end-2022. That said, we are watchful of strong competition in the mobile space due to DITO’s ramp up, persisting pricing pressure, and rising dividends. A minority stake sale of its data center business is also credit positive, though progress is seemingly elusive.
Recommendation Reviewed: February 03, 2026
Recommendation Changed: February 03, 2026
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