{"id":332823,"date":"2025-06-11T01:04:16","date_gmt":"2025-06-10T17:04:16","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=332823"},"modified":"2025-06-11T01:07:38","modified_gmt":"2025-06-10T17:07:38","slug":"commentary-how-the-p200-day-minimum-wage-hike-could-affect-jfc-pgold","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/commentary-how-the-p200-day-minimum-wage-hike-could-affect-jfc-pgold\/","title":{"rendered":"Commentary: How the P200\/day minimum wage hike could affect JFC, PGOLD"},"content":{"rendered":"\n

Two houses, two prices<\/strong><\/p>\n\n\n\n

The House of Representatives\u2019 version of House Bill No. 11376, which proposes to increase the minimum wage by P200\/day, has been approved on third and final reading. Moving forward, this would now go through to the Senate for three more readings. Note that the Senate has already passed a counterpart bill proposing a P100\/day minimum wage hike last year. As such, the proposed bill will now go through a Bicameral Conference Committee (Bicam) to compromise and create a unified version of the bill.<\/p>\n\n\n\n

Meet me in the middle<\/strong><\/p>\n\n\n\n

With the bill at a standoff, we could assume that both parties will try to meet in the middle, which is at P150. If passed, this could put additional cost pressures on labor-intensive sectors such as retail and manufacturing. Another effect of this would be that companies could accelerate automation efforts, hire less or even outsource some of their operations to offset increasing labor costs. <\/p>\n\n\n\n

Impact on JFC, PGOLD<\/strong><\/p>\n\n\n\n

We see higher risks for personnel-heavy retail and quick service restaurants like PGOLD and JFC where we see manpower costs accounting for 12.7% and 17.7% of total operating costs, respectively. Our forecasts show that enacting the wage hike bill could bring these percentages up closer to 15% and 20% for the two companies.<\/p>\n\n\n\n

Once the wage hike bill is passed and lapsed into law, both companies will see an increase in operating costs and a contraction in operating margins. However, the key difference between the two companies is their product types with JFC being consumer \u2013 discretionary while PGOLD is a consumer \u2013 staple. <\/p>\n\n\n\n

Net positive for PGOLD, net negative for JFC<\/strong><\/p>\n\n\n\n

As a discretionary consumer company, JFC\u2019s target market is more middle-class, while PGOLD caters more to class CDE. With this context, we expect PGOLD to see topline growth as margin contraction would be underpinned by volume-driven growth driven by the increased purchasing power of its target market. On the other hand, JFC would see a bigger contraction in margins while their target market does not directly benefit from the legislated wage hike. <\/p>\n\n\n\n

With all of these in consideration, the enactment of the bill could be a net positive for PGOLD and a net negative for JFC.<\/p>\n\n\n\n

<\/div>\n\n\n\n

This report is prepared by PinoyInvestor\u2019s partner broker below. Find out more about our partner brokers<\/a> and sign up to avail their complete trading brokerage services.<\/em><\/em><\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Here\u2019s a commentary on an important issue or event affecting the stock market<\/p>\n","protected":false},"author":11,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1124,11],"tags":[],"class_list":["post-332823","post","type-post","status-publish","format-standard","hentry","category-commentaries-special-reports","category-special-reports","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"_links":{"self":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/332823","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/comments?post=332823"}],"version-history":[{"count":1,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/332823\/revisions"}],"predecessor-version":[{"id":332825,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/332823\/revisions\/332825"}],"wp:attachment":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/media?parent=332823"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/categories?post=332823"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/tags?post=332823"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}