The newly listed fuel station operator, trading under the ticker code TOP, became the best-performing stock on the Philippine Stock Exchange, with gains of over 340 percent over the past month.
On Monday, it added another 35 percent to P1.58 per share, making it the second most valuable oil company on the PSE at about P17 billion—just behind tycoon Ramon S. Ang’s Petron Corp., which is worth P22.5 billion.
At its current price, Top Line is also more than double the value of Shell Pilipinas Corp. (P7.7 billion), owned by Netherlands-based energy giant Shell.
TOP is on a tear, stock trading at 409 percent higher than its IPO price of P0.31 each last April 8.
What’s going on?
Top Line, which raised P733 million from its April 8 initial public offering, is primarily engaged in fuel trading but is gaining attention for its aggressive expansion of Light Fuels retail stations.
It recently sealed a P1-billion deal to acquire and upgrade 38 service stations, a two-million-liter depot, and 15 fuel tanker trucks from Total Oil & Gas Resources Inc. and Ballston Metro Corp., widening its footprint in Cebu and other parts of Visayas.
A few days later, it announced the purchase of a Cebu gas station from Davao-based tycoon Dennis A. Uy's Phoenix Petroleum Philippines, another fuel retailer facing significant financial pressure and debts.
Management has signaled it is open to more acquisitions only if the numbers make sense.
Aggressive acquisitions
By relying on asset purchases instead of organic expansion, the company is on track to reach 50 stations in its first year alone—five times the planned yearly pace of 10 under its original three-year target of 30 locations.
Top Line, managed by the millennial Lim siblings with Erik Lim as chair, president and CEO, signaled to investors and stockholders the firm intends to seize growth opportunities.
“We understand the industry is evolving and we’re determined to be at the forefront of the change by not just reacting to trends but shaping them,” Lim said during the company’s annual stockholders’ meeting on Friday.
Valuation justified?
Alfred Benjamin R. Garcia, research head at AP Securities, said it is challenging to pin down projections when a company is making aggressive growth moves.
“[I]norganic growth is more unpredictable and makes it hard to estimate how much the company is worth after valuation,” he told InsiderPH.
“So it’s understandable that we are now seeing some frothiness in TOP’s valuations, but we’re bound to see this stabilize once the profitability of the acquisitions become clearer,” he added.
Another analyst noted that industry valuations do not reflect fundamentals, remaining underappreciated by investors amid the ongoing market slump.
Soaring prices
The price-to-earnings ratio, a standard measure of a stock’s profitability relative to its market value, shows Top Line trading at about 83 times earnings, versus 2.6 times for Shell Pilipinas and 1.4 times for Petron, based on annualized first-quarter 2025 earnings.
Using full-year 2024 net income, the multiples shift to roughly 109 times for Top Line, six times for Shell Pilipinas, and 2.6 times for Petron.
Petron, which operates a refinery and over 2,400 service stations, ended the past year with a profit of P8.4 billion, while Shell posted P1.3 billion from its network of more than 1,500 stations.
Established over a decade ago, Top Line finished 2024 with a profit of P115 million.
Top Line is betting that acquisitions will pay off
“Inorganic growth has always been the high risk, high reward route for companies,” Garcia said.
“It has the ability to suddenly take a company to the next level, as can be seen with the market now pricing TOP as the second most valuable fuel retailer on the stock exchange,” he added.
Long-term plans
During a press briefing after their stockholders’ meeting, Lim said their expansion program was not conceived overnight.
“Over the past 5-6 years, we wanted to make sure the infrastructure is in place, the team is in place, the systems, the IT infrastructure, and depot capacity is in place. We can now expand accordingly,” he said.
“In terms of the valuation…at the end of the day, we’re happy with the investors for their trust and confidence,” he added.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
