Financial Adviser: 5 Things to Know About Martin Zamora’s Nickel Asia Corp in 2025 and How to Profit From It

The Philippine stock market entered the week with a rare but cautious sense of relief. After months of relentless selling pressure, the PSEi finally showed signs of life by staging a short-term recovery from its November lows near the 5,550 level.

The rebound has lifted the benchmark back above the 6,000 mark, a psychological threshold that traders have been watching closely.

This recent climb is one of the strongest upswings in weeks. Yet the broader picture remains fragile. The rally still reflects a market locked in a longer-term downtrend, which is characterized by a sequence of lower highs stretching back to August.

Each attempt at a rally has so far met resistance, and while the latest bounce is encouraging, it has not yet reversed the structural weakness that has defined the index throughout 2025.

The mood across the market remains defensive. Political noise continues to weigh heavily on sentiment, particularly as fresh controversies involving key government agencies resurface.

These developments have added another layer of uncertainty at a time when investors are already struggling with elevated interest rates, a slowing economy, and ongoing questions surrounding policy direction. For many market participants, this combination represents a cocktail of risks that requires caution rather than conviction.

Because of this, the PSEi continues to rank among the region’s weaker performers year-to-date. Multiple blue-chip stocks remain stuck at multi-year lows despite occasional price upticks. But periods of pessimism also create pockets of opportunity.

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Historically, some of the best long-term returns in the Philippine market have been generated during phases when institutional sentiment is most fragile, and valuations are at their cheapest. When fear stretches prices far below intrinsic value, it opens a window for investors who are willing to look beyond short-term volatility.

One sector where this dynamic is becoming increasingly visible is mining. While global commodity prices have experienced volatility, the Philippines remains a strategic player in nickel production. Yet despite this enduring relevance, many mining stocks have been pulled down by the weakness in the general market rather than their own performance.

One company that clearly reflects this disconnect is Nickel Asia Corporation (PSE: NIKL). NIKL has been swept into the larger selling wave despite its solid fundamentals. As the broader PSEi grapples with volatility, NIKL’s valuation has drifted to levels that do not capture its true earnings power.

With the market still clouded by macro uncertainty, now is an opportune moment to step back, filter out the market noise, and take a closer look at what NIKL offers.

Here are the five things investors should know about Nickel Asia—and why this undervalued mining stock may be one of the overlooked opportunities in today’s market:

A review of the global nickel chart over the past 30 years shows a repeating pattern. Nickel moved in large, multi-year cycles. Prices rose sharply when supply tightened and fell when production increased. This boom-and-bust behavior appeared many times, which made the metal volatile in the short term but more predictable across decades.

The history of nickel prices showed three major bull markets. The first occurred in 2006–2007 when China expanded its stainless-steel industry and created a sudden surge in demand. The second cycle came in 2010–2011 during the global economic recovery. The most recent upswing appeared in 2021–2022 due to strong electric vehicle demand and temporary supply constraints.

Each rally lasted only one to two years, but after each cycle, nickel never returned to its previous lows. The price floor also moved higher through the decades. In the 1990s, nickel often stayed near $5,000 per tonne. In the 2000s, the lower range shifted to $7,000–$8,000.

After 2015, the floor settled near $10,000. Today, prices typically hold above $16,000–$17,000. This steady rise shows stronger long-term demand from stainless steel, battery production, and other industrial uses.

Current prices remain at the middle of the long-term range. They do not reflect a collapse, and they do not reflect a peak. Historically, this mid-cycle zone often leads to the next uptrend because the market absorbs excess supply while demand gradually strengthens.

Short-term pressure still comes from Indonesia’s rapid increase in output. However, the medium-term outlook remains constructive. Electric vehicle manufacturers require nickel-rich batteries.

Renewable energy systems also rely on nickel-based components. Stainless-steel demand in Asia continues to expand. These trends support the view that demand will eventually exceed supply.

This long-term cycle has important implications for the Philippines, one of the world’s major nickel exporters. When the global uptrend resumes, local producers are in a strong position to benefit early.

NIKL ended 2024 with softer results because of weaker nickel prices and a large one-time loss recorded in the fourth quarter. The company reported P22.33 billion in revenues, lower than the P24.70 billion posted in 2023, as ore prices eased and service income declined.

Net income fell to P2.92 billion after the company recognized a P1.9-billion impairment on geothermal assets and an additional P202 million in write-offs.

These non-cash charges pulled the full-year result below the company’s nine-month earnings and created an unusual gap between operational performance and reported profit. After adding back the one-off losses, the company’s adjusted 2024 earnings stood at P5.04 billion, which reflected a stable operating year.

The nine months of 2024 provide a clearer view of the company’s normal earnings capacity. NIKL posted P3.69 billion in net income by September, which equaled 73 percent of the adjusted full-year result. The ratio fits the company’s usual pattern, where most of the annual profit comes from the first three quarters because shipments slow down in the last quarter.

With the distortions removed, 2024 showed that the company was able to maintain solid earnings even under softer nickel prices. This improvement accelerated in 2025. For the first nine months, NIKL generated P7.26 billion in net income, almost double the P3.69 billion earned during the same period in 2024.

Revenues rose from P16.98 billion to P22.83 billion, a 35 percent increase. The stronger topline came from firmer realized prices, better ore grades, and higher shipment volumes. The company also kept its cost structure tight, which allowed the revenue gains to translate directly into higher profitability.

Using the historical nine-month ratio from 2024, the estimated full-year net income for 2025 stands at P9.94 billion. This amount represents a near-100 percent increase over the adjusted 2024 earnings of P5.04 billion.

The improvement came even as global nickel prices stayed relatively stable, which shows that the earnings rebound did not depend on a commodity surge. It came from stronger operations, better grade quality, and disciplined cost control.

NIKL’s balance sheet strengthened in parallel with earnings. Cash and cash equivalents rose to P18.9 billion as of September 2025, up from P12.94 billion at year-end 2024. The current ratio of 2.01× showed comfortable short-term liquidity.

The company’s net cash position stood out in the local mining sector, where many firms typically carry higher leverage because of capital-intensive operations. What made the cash increase more notable was that it came after significant outflows, such as P2.85 billion in dividends, P4.55 billion in capital expenditures, and scheduled loan repayments.

The cash growth demonstrated that the NIKL generated more than enough internal funds to cover growth requirements and shareholder distributions. Management ratios reflected the same recovery trend. Reported ROE for 2024 stood at 6.6 percent. In 2025, NIKL’s trailing ROE returned to 13.4 percent, which matched its 2023 pre-impairment performance and confirmed a full recovery in the company’s ability to generate returns on shareholder capital.

Return on invested capital (ROIC) delivered a similar message. Reported ROIC for 2024 landed at 7.1 percent. This year, NIKL’s latest trailing ROIC climbed to 16.2 percent, slightly above the 2023 level. This return profile showed a business that continued to earn well above its cost of capital, even under a mild pricing environment.

Taken together, the earnings rebound, stronger cash position, and restored investment return ratios place NIKL on a firmer financial footing in 2025. The company rebuilt its earnings capacity and strengthened its liquidity without depending on a surge in nickel prices.

NIKL’s current valuation stands far below the levels investors assigned to the company during prior cycles. From 2022 to 2023, the stock frequently traded between P6.00 and P10.00, a zone that reflected a P/E ratio of 12× to 18× and a P/BV multiple of 1.8× to 2.3×. Even during weaker commodity cycles, the stock rarely fell below P5.50, which corresponded to a mid-cycle valuation of about 10× earnings and 1.5× book value.The contrast with today’s pricing is stark.

At the current share price of P3.65, Nickel Asia trades at a trailing P/E of roughly 7.8× and a P/BV of only 1.05×, close to liquidation-level pricing rather than a reflection of a company that generated P6.50 billion in trailing net income for the past 12 months and improved its return on equity to 13.4 percent. When the stock reverts to its long-term valuation norms, the gap becomes clearer. If NIKL trades again at its historical mid-cycle P/E of 10×, the implied fair value rises to P4.68 per share. If the market assigns the company its typical pre-2024 P/BV of 1.5×, the valuation approaches P5.20.

Even the lower bound of this historical range places the stock at a 28 percent premium to its current price, while the mid-cycle P/BV suggests a discount of 43 percent from where the stock normally commands market support. These comparisons show that the current valuation stems not from weak fundamentals but from an overly pessimistic market cycle.

NIKL’s dividend capacity for 2025 shows a valuation gap that the market has yet to recognize, especially when examined through its historical payout behavior. In 2024, the company paid P2.85 billion in dividends despite earning P2.92 billion, resulting in a payout ratio of 97.5 percent.

This pattern reflects management’s long-standing approach of returning most of its earnings when liquidity remains strong. Using this payout history as the basis for the 2025 projections, NIKL’s estimated P9.94-billion net income translates to a dividend pool of P9.69 billion, or P0.695 per share, based on its 13.93-billion shares outstanding.

Even a conservative 50-percent payout produces a dividend of P0.357 per share. At today’s price of P3.65, these figures imply dividend yields of 19.0 percent and 9.8 percent, which suggest a clear undervaluation relative to the company’s earnings strength. Once these dividends are compared with fair-yield benchmarks, the valuation disconnect becomes sharper.

Using NIKL’s historical yield of 8 percent, the stock’s implied fair value rises to P8.69 under the historical payout scenario and P4.46 under the conservative case. When the broader market’s 4.5-percent yield is used, the fair values climb to P15.44 and P7.93, respectively. Each valuation outcome stands materially above the current P3.65 share price.

NIKL appears to have completed a full multi-year bear cycle from 2022 to 2025 and now enters the early phase of a new upward trend. The decline from the P10 peak to the P5.30 level in 2022–2023 formed Wave A, an impulsive drop that opened the bear market.

This was followed by Wave B in 2023–2024, a choppy corrective rebound that lifted the stock to the P7 area but failed to establish any sustained strength. The final capitulation took place in 2024–2025 as Wave C unfolded from P7 down to P2.00, completing a textbook five-wave down sequence. The rebound from P2.00 to P4.00 marked the first clean impulsive advance of the next major cycle, which establishes the base for a new trend.

From the P2.00 low, the structure shows Wave 1 rising to P4.00 with strong volume, followed by Wave 2 retracing to P3.30, a correction consistent with the typical 50–61.8 percent zone. With this corrective leg finished, Wave 3 now begins and usually delivers the strongest advance in the wave structure. Classical Fibonacci projections support this view.

Based on Wave 1’s size of P2.00, Wave 3 projects toward P5.20 under the standard 1.618 extension and toward P7.20 if the wave extends more aggressively, especially if nickel prices recover. A full wave cycle would point toward a longer-term objective near P8.50–P9.00 levels.

Geometric price levels add confirmation to the bullish structure. Support emerged at the Gann 1×1 zone around P3.30, with deeper structural support at P2.80 and major cycle support at the P2.00 low.

The stock now trades near the geometric price breakout band at P3.60–P3.70, and a push through P3.85 would trigger a full geometric price trend reversal. The broader time cycle also aligns with this outlook.

The entire 2022–2025 decline fits a 36-month major geometric price cycle, and the reversal from the P2.00 low occurred exactly where the long-term cycle bottom tends to form. The next geometric price time expansions point to mid-2026 and early 2027 as potential peak windows, matching the Wave upside targets.

Taken together, both Wave and Geometric Price analysis indicate that the P2.00 low already marks the final bottom, and the stock now advances through the strongest phase of a new multi-year cycle.

The current consolidation near P3.45–P3.60 stands as a buy-the-dip formation, with strong accumulation zones at P3.30, P3.45, and P3.60. A daily close below P3.10 would invalidate the structure, although such a breakdown remains unlikely unless nickel prices collapse. Overall, the combined technical framework points toward a sustained recovery that extends into 2026 and beyond.

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