Equity Research July 9th, 2019 Monthly Andean Strategy Update Our Andean strategy remains unchanged In June, the Andean region posted a positive performance across the CREDICORP CAPITAL RESEARCH board in line with other LatAm markets. Chile, Peru and Colombia posted • 6.6%, 6.1% and 9.6% returns in USD terms (+1.9%, +3.5%, and +4.2% in local terms), respectively; LatAm posted a 6.0% return in USD terms. Daniel Velandia, CFA We maintain our Overweight recommendation for Chile; the +(571) 3394400 ext. 1505 performance in June was positive, but there is still a long way to go.
[email protected] • We expect the economy to grow by slightly above 2% in 1H19, but we assume the return of close-to-potential growth rates starting in 2H19. Carolina Ratto • Cencosud’s real estate IPO has passed and Enel Am’s subscription +(562) 2446 1768 period started last week. Although we still have to wait for 30 more
[email protected] days, the overhang should disappear starting in August. • June was a positive month for the index with a generalized recovery; Tomás Sanhueza however, it is still soft, and major impulse should come going into 2H19. +(562) 2446 1751 • Valuations remain discounted, even when stressing the earnings growth
[email protected] of relevant sectors such as Pulp, Retail and Banks. This leads to a limited downside to current levels. Sebastián Gallego, CFA We maintain our Neutral position on Colombia. Positive news drove +(571) 3394400 ext. 1594 the Colombian market in June as the Senate rejected the proposal to
[email protected] eliminate some banking fees and the reorganization of Casino’s assets benefited Exito.