MANILA, Philippines — SM Investments Corp. is increasingly looking beyond Metro Manila for its next wave of growth, with President and CEO Frederic C. DyBuncio pointing to rising incomes, changing consumer aspirations and expanding regional markets as important long-term opportunities for Philippine businesses.
DyBuncio made the remarks at the 24th Management Association of the Philippines (MAP) International CEO Conference, held under the theme “In the Age of Flux: Scaling the Next Inflection Points.” The conference focused on how companies can identify structural changes in the economy amid rapid developments in technology, artificial intelligence and consumer behavior.
For SM Investments, one of the country’s largest diversified conglomerates, the message is increasingly clear: future demand will not be concentrated in the capital alone.
“As incomes rise and aspirations evolve, opportunities are opening across the regions,” DyBuncio said, according to reports on his address. He said businesses need to look beyond traditional centers of growth and invest where the next generation of demand is developing.
Why the regions are becoming more important
The shift toward provincial markets is not entirely new for SM.
The group’s businesses span retail, property, banking and portfolio investments, giving it multiple ways to participate in rising consumption and investment activity outside Metro Manila.
SM’s 2025 investor presentation showed that the group already had a substantial footprint outside the National Capital Region, including retail stores, malls and bank branches across Luzon, Visayas and Mindanao. The company has also identified underpenetrated provinces as important areas for long-term expansion.
Earlier this year, SM Investments said it intended to continue increasing its capital spending across its core businesses, with expansion outside Metro Manila remaining part of its strategy. Business reports at the time cited the company’s plans to expand its retail and banking footprints as inflation conditions improved.
That strategy matters because regional economic growth can create new demand for exactly the products and services offered by SM’s businesses—from shopping and food retail to residential and commercial property and banking.
SM’s latest numbers provide the backdrop
The conglomerate’s financial performance has also given management room to continue investing.
For the first half of 2026, SM Investments reported consolidated net income of ₱45.9 billion, an 8% increase from ₱42.6 billion in the same period a year earlier. Consolidated revenue rose 6% to ₱339.2 billion from ₱319.2 billion.
Banking accounted for the largest share of first-half earnings at 47%, followed by property at 27%, retail at 15% and portfolio investments at 11%. The company also reported total assets of approximately ₱1.82 trillion at the end of June.
SM executives said the group’s provincial expansion plans remained on track despite adjustments to capital-expenditure guidance.
“We’re changing our guidance for capex… our focus on provincial expansion continues to be on track and we’re not scaling back,” SM Investments executive vice president for finance Franklin Gomez said, according to GMA News.
That distinction is significant: changes in spending guidance do not necessarily mean the company is abandoning its geographic expansion strategy.
Retail is already moving deeper into the provinces
SM’s retail operations provide one of the clearest examples of this strategy.
The group’s 2025 investor materials showed thousands of retail outlets nationwide, while the company has continued opening new stores outside Metro Manila. The presentation noted that more than 80% of new retail stores opened in 2025 were outside Metro Manila, highlighting the importance of provincial markets to the group’s retail expansion.
This expansion is not limited to traditional department stores and supermarkets.
SM’s retail portfolio includes multiple formats, while its broader ecosystem connects retail operations with malls, banking and property development.
That gives the conglomerate an opportunity to follow consumers as regional economies develop rather than relying solely on mature markets in Metro Manila.
Banking provides another regional growth engine
Banking is another major component of the strategy.
SM’s banking businesses, particularly BDO Unibank and its other banking interests, provide exposure to expanding consumer and business activity throughout the country.
During the first half of 2026, SM reported mid-teens loan growth in its banking businesses. Banking remained the group’s biggest earnings contributor during the period.
The significance goes beyond SM’s own balance sheet. As provincial businesses expand and household incomes increase, demand for deposits, loans, payments and other financial services can also increase.
SM’s previous expansion plans have specifically highlighted opportunities to strengthen banking coverage in the Visayas and Mindanao, including through BDO Network Bank.
Property follows the same demographic shift
Property development is another piece of the equation.
As new economic centers emerge, demand can grow for shopping centers, residential developments, offices, hotels and mixed-use projects.
SM Prime, SM Investments’ property arm, has continued expanding its mall network, while SM Development Corp. has pursued residential projects in different parts of the country.
The group’s 2025 investor presentation listed provincial residential expansion among its priorities and projected additional mall openings in 2026.
The underlying strategy is straightforward: where populations, incomes and consumer aspirations grow, demand for physical and financial infrastructure can follow.
AI can find the pattern—but people still decide where to invest
DyBuncio’s comments also addressed the growing influence of artificial intelligence and data analytics on corporate decision-making.
AI can help companies process information and identify patterns more quickly, but DyBuncio emphasized that technology does not eliminate the need for management judgment.
Executives still have to determine which trends are durable, where capital should be deployed and when to act.
That becomes particularly relevant for regional expansion, where companies must distinguish between temporary increases in demand and long-term changes in demographics, income and consumer behavior.
SM is betting on the long game
The broader strategy reflects SM Investments’ longstanding emphasis on diversification.
In 2025, SM Investments posted full-year net income of approximately ₱90.5 billion, up 10% year-on-year, according to company information reported by The Manila Times.
The group has repeatedly described its businesses as complementary, with retail, banking, property and portfolio investments providing different sources of earnings and cash flow.
That diversification can also give SM multiple entry points into regional growth.
A new provincial economic center, for example, can generate opportunities simultaneously for a supermarket, a mall, a bank branch, residential property and logistics or other supporting businesses.
The bigger question is how far the regional opportunity can go
DyBuncio’s latest message comes as Philippine companies face a rapidly changing business environment marked by technological disruption, shifting consumer behavior and uneven economic conditions.
For SM Investments, the strategy is not simply about putting more stores or malls outside Metro Manila. It is about identifying where Filipino consumers and businesses will be several years from now—and building an ecosystem around that demand.
The company’s recent financial results, continued provincial expansion plans and emphasis on long-term investment indicate that regional markets remain an important part of its growth strategy.
But the real test will be whether rising regional incomes and changing aspirations translate into sustained demand strong enough to support years of investment.
For now, DyBuncio’s message signals where SM Investments is looking next: not just at today’s biggest markets, but at the Philippine regions where tomorrow’s consumers may be.
