The local stock market has already touched US$1,900 and if we compare – updated for inflation – with the last best peak that was during Macri’s presidency, that time it reached US$2,300. That is to say, that There is still room for upside for local stocks. It is worth clarifying that those US$400 that remain to be covered will occur more gradually compared to the rapid growth that we saw in 2024. Where to invest to take advantage of it?
The key to capitalizing on this increase Much will depend on the decisions the government makes about taxes over the next year. Although the removal of the PAIS tax is a good start on this path (it will disappear on December 23) it is also true that the market expects new possible tax measures that favor both companies and individual investors.
One of the possibilities that are being considered is about co-participation with the provinces. An alternative is for the government to reformulate this distribution for the provinces starting in 2025, but also The idea of “tailored RIGIs” is beginning to gain more and more strength.”. This means, new Incentive Regime for Large Investments for smaller amounts (today authorized for US$200 million) and suitable for each particular industry.
The different sectors that today are outside the RIGI current are very interested in this alternative and listen carefully to the discussions that are taking place on the subject, since this tool could provide important support to the recovery of the economy that has begun but still has a long way to go.
It is worth remembering that the RIGI current grants the possibility for companies to develop investments in Argentina exclusively in strategic sectors for the country such as oil and gas, mining, renewable energy, forest industry, steel, technology, infrastructure and tourism. It will be necessary to see if 2025 expands the range of industries or proposes new tax alternatives that offer benefits (or relief) for each one separately.
What to invest in to take advantage of the RIGI momentum?
One way to capitalize on the strong development in the short and medium term of these industries is by investing in stocks in these sectors that will benefit directly or indirectly from these large dollar outlays.
Our selection highlights five roles: YPF, Transportadora de Gas del Norte, Transportadora de Gas del Sur and Agrometal and Bioceres; The latter is a company that, in addition to being a leader in the crop genetics segment, works on the identification of technologies and development of products for the agricultural sector.
Furthermore, as has been reflected in recent months, RIGI investments are boosting the growth of the capital market since many of the companies benefited by this regime are listed on the local stock exchange. And that’s why we see potential in roles directly related to market performance itself to take advantage of this increase. Our chosen ones are BYMA and MTR. BYMA is the ticker of “Argentine Stock Exchanges and Markets”, which has an interesting cash and bond fund, added to the operating results of the flows, but we detect that the price is still not accompanying the action.
And finally MTR, who have our full attention. This paper is a conglomerate between Matba, Rofex and MAE, the three financial markets that came together and now trade as a single stock. Particularly in MTR we see that the price is still not valuing the future growth that the Argentine financial market could have if the government maintains financial and macroeconomic stability as it has been doing until today, added to the new investments that would come from both RIGI and direct investments of international funds in the Argentine capital market.
In summary, The S&P Merval has more to give and there are shares with pending upside to go. This is why we understand it is a good opportunity to put together a portfolio diversified in sectors and with structural fundamentals for each case that support the choice with a medium/long-term horizon.
CEO of Insider Finance.
Source: Ambito
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