Manila Electric Co. shares extended their decline to a fourth consecutive session, erasing approximately 127 billion pesos ($2 billion) in market capitalization as investors weigh the impact of a proposed regulatory reform. The selloff reflects mounting concern that a plan to eliminate a key power charge for consumers could significantly compress the utility's earnings profile.

The proposed measure targets the generation charge component of electricity bills, which currently allows Meralco to pass through power procurement costs to customers. Analysts warn that removing this pass-through mechanism would shift volume and price risk onto the utility, potentially undermining its regulated returns framework. The stock has now declined for four straight sessions, marking its longest losing streak in months.

Regulatory uncertainty continues to dominate sentiment toward Philippine utilities. The Energy Regulatory Commission has yet to finalize the proposal's scope or implementation timeline, leaving $2 billion in shareholder value in limbo. Market participants are closely monitoring upcoming hearings for clarity on whether the reform will proceed in its current form or face modifications.

Meralco, the country's largest power distributor serving Metro Manila and surrounding provinces, has historically relied on regulatory stability to support its dividend yield and infrastructure investment program.