Can the PSE lose ICTSI?

The transcript covers market news regarding rumors that ICTSI (ICT) may delist from the Philippine Stock Exchange (PSE) and move to the Hong Kong Stock Exchange. These rumors were prompted by ICTSI's aggressive share buyback program despite reaching record highs. The analyst presents several reasons why such a delisting would be detrimental to the market. First, ICTSI is the top-weighted stock in the PSEI index, so its removal would eliminate significant alpha from the index and negatively impact index performance. Second, ICTSI is a major constituent in numerous local equity funds, forcing them to reallocate to alternative blue-chip stocks that may not provide comparable returns. The analyst specifically highlights the BPI Infrastructure Equity Index Fund, which has a 52.92% allocation to ICTSI, suggesting that this concentrated position has been a key driver of the fund's outperformance relative to other local equity funds. However, the analyst expresses skepticism about the likelihood of a full delisting. Given ICTSI's market cap of approximately 2 trillion pesos and a public float of around 50%, a tender offer to buy out remaining public shareholders would cost roughly 1 trillion pesos at current prices, which the analyst considers prohibitively expensive. Based on this analysis, the analyst concludes that a complete delisting is unlikely and that a dual listing arrangement with both the PSE and Hong Kong Stock Exchange is a more probable scenario. The analyst's final assessment is that the PSE cannot afford to lose ICTSI.