Living in the Philippines, it is surprisingly easy to encounter a business connected to LT Group, Inc. (PSE: LTG).
You might bank with Philippine National Bank (PNB), see Marlboro and Fortune cigarettes at a convenience store, buy Tanduay rum at a supermarket, or pick up Cobra Energy Drink and Absolute or Summit bottled water. Eton Centris, the mixed-use development at Quezon Avenue and EDSA in Quezon City, also belongs to the group.
LT Group is the listed holding company controlled by businessman Lucio C. Tan and his family. It is currently included in both the Philippine Stock Exchange Index (PSEi) and the PSE Dividend Yield Index.
The headline performance looks strong. LTG achieved a fourth consecutive year of record attributable net income in 2025, followed by its highest first-half profit since its 2013 follow-on offering in the first half of 2026. Its shares also appear inexpensive relative to earnings and book value, while its historical dividend yield is high.
That does not mean every business in the group is growing. PNB and the tobacco business generated more than four-fifths of LTG’s attributable profit in 2025. PNB’s first-half 2026 growth also benefited from gains on property disposals and a reversal of credit-loss provisions.
This article examines LTG’s history, business structure, financial performance, dividend, valuation and principal risks.
Financial results are updated through 30 June 2026. The share-price calculations use LTG’s last traded price on 14 August 2026.
From a wine merchant to a listed holding company
LTG traces its history to The Manila Wine Merchants, Inc., established in 1937. The company initially traded wine and other alcoholic beverages and listed on the Philippine Stock Exchange in 1947.
It became a holding company in 1995 and changed its name to Asian Pacific Equity Corporation. In 1999, it acquired Tanduay Distillers, Inc. (TDI) through a share swap and became Tanduay Holdings, Inc.
The decisive change came in 2012 and 2013. The company adopted its present name, LT Group, Inc., and reorganised the banking, tobacco, beverage and property interests held by the Lucio Tan side of the family under the listed holding company.
Lucio C. Tan is now chairman and chief executive officer, while his grandson, Lucio C. Tan III, is president and chief operating officer.
As of 30 June 2026, Tangent Holdings Corporation owned 74.36% of LTG. PSE Edge reported a public float of 25.63%, leaving control firmly concentrated with the founding family.
LTG is not the whole Lucio Tan business empire
LTG’s principal businesses and effective ownership interests as of 30 June 2026 were:
- Banking: 56.5% of Philippine National Bank
- Tobacco: 99.6% direct and indirect ownership of Fortune Tobacco Corporation; Fortune Tobacco owns 49.6% of PMFTC Inc.
- Distilled spirits: 100% of Tanduay Distillers, Inc.
- Beverages: 99.9% of Asia Brewery, Inc.
- Property: 99.6% indirect ownership of Eton Properties Philippines, Inc.
- Sugar: 30.9% of Victorias Milling Company, Inc.
The PMFTC relationship is especially important.
PMFTC was formed in 2010 by combining the Philippine operations of Fortune Tobacco and Philip Morris Philippines. It sells brands including Marlboro and Fortune. LTG’s economic interest is 49.6%, however, so PMFTC is an equity-accounted investment rather than a consolidated subsidiary.
LTG therefore participates in PMFTC’s profits, but it does not control the company by itself.
PAL Holdings, which owns Philippine Airlines, and aviation-services company MacroAsia Corporation are also closely associated with the Lucio Tan family. They are not consolidated businesses of LTG. Buying LTG shares is not the same as investing directly in Philippine Airlines.
Five businesses visible in everyday life
PNB: the largest profit contributor
PNB was established as a government bank in 1916 and is now a privately controlled universal bank. Its services include deposits, corporate and consumer lending, remittances, foreign exchange, investment banking and trust products.
PNB is separately listed on the PSE under the ticker PNB. An investor seeking exposure specifically to the bank can buy PNB shares; LTG combines the bank with tobacco, Tanduay, Asia Brewery, Eton and other interests.
PMFTC: Marlboro and Fortune
LTG participates in the tobacco business through Fortune Tobacco’s stake in PMFTC. It is a highly profitable and cash-generative business, but it is exposed to excise taxes, product and advertising regulation, illicit trade and changing attitudes towards smoking.
Tanduay: particularly strong in the Visayas and Mindanao
Tanduay Distillers produces rum as well as brandy, whisky, gin and bioethanol.
Its share of the Philippine distilled-spirits market rose from 34.2% in 2024 to 39.5% in 2025. Its position was particularly strong in the Visayas, where its share reached 70.4%, and Mindanao, where it reached 82.9%.
Asia Brewery: Cobra, Absolute and Summit
Asia Brewery’s portfolio includes Cobra Energy Drink, Absolute and Summit bottled water, and Vitamilk. Its operations also extend to glass bottles and packaging materials.
Eton Properties: Eton Centris and other developments
Eton Properties develops residential projects, offices, retail space and mixed-use estates. Its best-known project is Eton Centris at the junction of EDSA and Quezon Avenue. Its portfolio also includes Eton WestEnd Square in Makati and Eton City in Laguna.
2025 brought a fourth straight year of record profit
LTG reported the following consolidated results for 2025:
- Revenue: ₱132.8 billion, up 3%
- Profit before tax: ₱51.1 billion, up 13%
- Consolidated net income: ₱42.3 billion, up 10%
- Net income attributable to LTG shareholders: ₱31.0 billion, up 7%
- Earnings per share: ₱2.86, up from ₱2.67
Attributable net income reached a record for the fourth consecutive year.
PNB provided 46% of LTG’s attributable profit, while Fortune Tobacco provided 36%. Together, those two businesses accounted for 82% of the total.
- PNB: ₱14.3 billion, up 20%
- Fortune Tobacco: ₱11.2 billion, down 12%
- Tanduay Distillers: ₱3.1 billion, up 45%
- Asia Brewery: ₱867 million, up 4%
- Eton Properties: ₱762 million, up 261%
- Victorias Milling: ₱354 million, down 28%
- Other businesses: ₱385 million
The group as a whole performed well, but the results were uneven.
PNB recorded a fourth consecutive year of record profit, while Tanduay achieved a sixth. Fortune Tobacco’s contribution fell by 12% because it received a smaller dividend from PMFTC, even though PMFTC’s equity-accounted earnings increased by 15%.
Eton’s sharp profit increase included non-recurring items, such as compensation received from a local government for land used as a road right of way. The 261% increase should not be treated as a sustainable growth rate.
Why PNB and Tanduay grew
PNB: stronger margins, fees and credit costs
PNB’s own net income rose by 20%, from ₱21.2 billion in 2024 to ₱25.3 billion in 2025.
Interest income from loans and securities increased, while funding costs declined. Net interest income therefore rose by 6% to ₱52.6 billion, with a net interest margin of 4.5%.
Fee income, trading and foreign-exchange gains, and gains on property disposals also improved. Lower impairment and credit-loss expenses provided an additional lift.
Tanduay: pricing and cost discipline
Tanduay’s net income increased by 45% to ₱3.1 billion in 2025. Revenue was broadly flat at ₱34.0 billion, but price increases, lower manufacturing costs and a better product mix lifted its gross margin from 15% to 17%.
The company therefore expanded profit without relying on a large increase in sales volume.
Another record in the first half of 2026 — with a qualification
LTG continued to grow in the first half of 2026:
- Revenue: ₱65.5 billion, up 2.6% year on year
- Consolidated net income: ₱23.5 billion, up 14.7%
- Net income attributable to LTG shareholders: ₱17.0 billion, up 13.8%
- Earnings per share: ₱1.57, up from ₱1.38
The company described this as its strongest first-half result since its 2013 follow-on offering.
Banking, tobacco and Tanduay again drove the growth.
PNB: profit up 17%, with an ₱8.2 billion contribution to LTG
PNB’s first-half net income increased by 17% to ₱14.6 billion. Its contribution to LTG was ₱8.2 billion.
Net interest income rose by 7% to ₱27.6 billion, while fee income increased by 9% to ₱3.1 billion. Trading, investment and foreign-exchange gains, however, fell sharply from ₱1.4 billion to ₱212 million.
One reason profit still grew was the disposal of acquired properties. Other income increased from ₱1.7 billion to ₱4.1 billion. PNB also recorded a net reversal of ₱831 million in impairment and credit losses, compared with a ₱342 million provision a year earlier.
The growth in core net interest and fee income is encouraging. Nevertheless, not all of the first-half profit increase should be assumed to recur: property-disposal gains and the swing in credit costs need to be considered separately.
Tobacco: pricing helped profit rise 13%
The tobacco business contributed ₱6.2 billion in first-half profit, up 13%. A PMFTC price increase in March 2026 supported profitability.
The Philippine excise tax on a pack of 20 cigarettes rose by 5% to ₱69.46 from January 2026. Passing the tax increase on through pricing can protect margins, but higher legal-market prices may also reduce consumption or encourage a shift towards illicit cigarettes.
Tanduay: both volume and pricing improved
Tanduay’s first-half net income rose by 16% to ₱1.6 billion, while revenue increased by 9% to ₱16.7 billion. Alcohol sales volumes and prices both improved, and the gross margin widened from 17% to 18% despite higher raw-material and distribution costs.
Asia Brewery and Eton moved backwards
Not every business performed well.
Asia Brewery’s first-half net income fell by 23% to ₱378 million. Revenue increased by 2%, but glass-bottle production costs and greater distributor support reduced its gross margin from 25.4% to 21.9%.
Eton Properties’ first-half net income declined from ₱352 million to ₱291 million. Rental income and property sales increased, but the comparison was affected by a one-off gain in the previous year.
A bank’s deposits are not ordinary corporate debt
LTG reported the following consolidated financial position at 30 June 2026:
- Total assets: ₱1.474 trillion
- Total liabilities: ₱1.103 trillion
- Total equity: ₱371.6 billion
- Equity attributable to LTG shareholders: ₱259.7 billion
- Book value per share: ₱24.00
- Cash and cash equivalents: ₱219.2 billion
- Consolidated liabilities-to-equity ratio: 2.97 times
Much of the group’s liabilities and cash sits within PNB’s banking balance sheet. Customer deposits are liabilities for a bank, while loans are assets. Treating those deposits like the borrowings of a manufacturer would produce a misleading view of leverage.
For 31 March 2026, LTG reported a liabilities-to-equity ratio of 3.00 times including PNB but only 0.09 times excluding the bank.
The reverse warning also applies to cash. LTG cannot freely use the entire ₱219.2 billion of consolidated cash for dividends or acquisitions. The parent company itself held about ₱2.1 billion of cash at 31 March. Bank liquidity and cash available to the holding company must be analysed separately.
An attractive dividend, but special dividends are not guaranteed
LTG declared total dividends of ₱1.25 per share for 2025, distributing ₱13.5 billion to shareholders. The payout ratio was 46.8%.
By 14 August 2026, the company had declared and paid a further ₱0.60 per share:
- February: ₱0.15 regular dividend plus a ₱0.15 special dividend
- May: ₱0.30 special dividend
The 2025 dividend of ₱1.25 represents a historical yield of approximately 8.4% at the 14 August 2026 price of ₱14.88. The ₱0.60 declared so far in 2026 is equivalent to about 4.0% of that price.
There is an important qualification. Only ₱0.15 of the 2025 total was classified as a regular dividend; the rest was special. LTG has stated in previous annual reports that its baseline dividend policy is a 20% payout ratio. Actual distributions depend on the board, the parent’s cash position, dividends received from subsidiaries and associates, and investment requirements.
Past special dividends should not be treated as a guaranteed future minimum.
The shares look inexpensive relative to earnings and book value
LTG’s last traded price on 14 August 2026 was ₱14.88. Multiplying that by 10.821 billion outstanding shares gives an estimated market capitalisation of about ₱161.0 billion.
PSE Edge reported a 52-week high of ₱16.20 and a low of ₱13.36. The 14 August price was about 8% below the high and 11% above the low.
Using 2025 earnings per share of ₱2.86 and book value per share of ₱24.00 at 30 June 2026 produces the following approximate valuation:
- Price-to-earnings ratio based on 2025 earnings: 5.2 times
- Price-to-earnings ratio based on trailing 12-month earnings: 4.9 times
- Price-to-book ratio: 0.62 times
- Historical yield based on the 2025 dividend: 8.4%
Trailing 12-month earnings per share are estimated at ₱3.05: full-year 2025 EPS of ₱2.86, plus first-half 2026 EPS of ₱1.57, less first-half 2025 EPS of ₱1.38.
The valuation appears low, but the discount has plausible explanations.
Profit is concentrated in banking and tobacco. Tobacco faces long-term regulatory and volume risks. PNB’s results include volatile property-disposal gains and credit costs. Family control is high, and LTG is a multi-business holding company that may trade at a conglomerate discount.
Six risks to watch
1. Tobacco regulation and illicit trade
Excise taxes continue to rise, while advertising, sales and product regulation may become more restrictive. Price increases can offset tax pressure, but a fall in legal-market volumes or migration towards cheaper illicit cigarettes could reduce PMFTC’s earnings and dividends.
2. Dependence on PNB
PNB generated 46% of LTG’s attributable profit in 2025 and approximately 48% in the first half of 2026. Interest rates, loan demand, deposit costs, credit losses, property prices and market gains can materially affect the whole group.
3. Reversal of one-off gains and credit benefits
PNB benefited from gains on the sale of acquired properties and a reversal of credit-loss provisions in the first half of 2026. Neither should be assumed to continue at the same scale.
4. Consumer demand and input costs
Tanduay and Asia Brewery are exposed to consumer purchasing power, excise taxes, sugar and grain prices, glass bottles, fuel and logistics. Asia Brewery’s first-half 2026 result shows that revenue growth does not necessarily translate into profit growth.
5. Family control and succession
Tangent Holdings owns 74.36% of LTG, and several members of the Tan family sit on its board and management team. Concentrated ownership can support long-term decision-making, but minority investors should monitor related-party transactions, capital allocation and succession.
6. Reliance on special dividends
Most of LTG’s recent dividend yield came from special distributions. The annual total can change depending on dividends received from PNB and PMFTC, the parent’s investment plans and the board’s decisions.
My view
The idea that LTG is succeeding is broadly supported by the financial results.
LTG delivered a fourth consecutive year of record profit in 2025 and another first-half record in 2026. PNB achieved a fourth straight record year, while Tanduay reached a sixth. At the 14 August price, LTG traded at roughly five times earnings and 0.62 times book value, with a historical dividend yield of about 8% based on the 2025 distribution. This is a very different financial picture from a conglomerate dealing with large impairments and losses.
I would not, however, define success simply as a low price-to-earnings ratio and a high dividend yield.
PNB’s property-disposal gains and improved credit costs contributed to first-half growth. Tobacco remains highly profitable but faces structural risks from taxation, regulation and illicit trade. Asia Brewery and Eton both reported lower first-half profit, and LTG’s earnings are less diversified than its collection of brands initially suggests.
The figures I would watch next are PNB’s net interest and fee income excluding one-off gains, PMFTC’s legal-market volume and market share, Tanduay’s margins, Asia Brewery’s gross-margin recovery, and LTG’s full-year dividend including any further special distributions.
LTG is not an investment in the entire Lucio Tan empire. In practical terms, it is a high-dividend holding company built primarily around PNB and PMFTC, with additional exposure to Tanduay, Asia Brewery, Eton and Victorias Milling.
Key points
- LTG traces its origins to 1937 and has been listed since 1947.
- Banking, tobacco, beverages and property were reorganised under the holding company in 2012–2013.
- Its principal interests include 56.5% of PNB, an effective 49.6% economic interest in PMFTC, 100% of Tanduay, 99.9% of Asia Brewery, 99.6% of Eton and 30.9% of Victorias Milling.
- PAL Holdings and MacroAsia are not consolidated businesses of LTG.
- Attributable net income reached ₱31.0 billion in 2025, its fourth consecutive record.
- PNB and Fortune Tobacco generated 82% of 2025 attributable profit.
- PNB achieved a fourth straight record year and Tanduay a sixth.
- First-half 2026 attributable net income rose by 13.8% to ₱17.0 billion.
- Banking, tobacco and Tanduay grew, while Asia Brewery and Eton reported lower first-half profit.
- PNB’s first-half growth also benefited from property-disposal gains and a reversal of credit-loss provisions.
- At ₱14.88 on 14 August, the approximate P/E ratio was 4.9–5.2 times and the P/B ratio was 0.62 times.
- The 2025 dividend implies a historical yield of about 8.4%, but special dividends are not guaranteed.
The profits contributed to LTG by PNB, Tanduay, Asia Brewery and Eton may differ from each operating company’s own net income because of LTG’s effective ownership and non-controlling interests. This article distinguishes the figures reported as “LTG’s share in net income” from the operating companies’ own results.
The market capitalisation, P/E ratio, P/B ratio and dividend yields are approximate calculations based on publicly reported share prices, outstanding shares, earnings, equity and dividends. They are not valuation measures published by the PSE.
This article is based on public information and reflects the author’s personal research and opinion. It is not a recommendation to buy or sell any security. Investors are responsible for their own decisions. Philippine equities involve price, currency, liquidity, regulatory and country risks.