How Henry Sy’s shoe-store instinct became SM Investments—one of Southeast Asia’s most formidable consumer empires

There is a certain kind of businessman who builds by acquisition, and another who builds by intuition. Henry Sy, Sr. belonged to the latter camp. When he opened a small shoe store in downtown Manila in 1958, he was not laying out a conglomerate strategy. He was watching customers—how they moved, what they wanted, what convenience meant in a country where modern retail was still a novelty. That instinct, more than any spreadsheet, became the foundation of SM Investments Corporation, the holding company that now sits at the center of retail, property, banking and a growing portfolio of strategic bets in logistics, energy and consumer businesses. By 2024, SM described itself as an “ecosystem of businesses,” but the phrase understates the scale of what was built: a company that has become inseparable from the routines of modern Filipino life. 

From the beginning, Sy’s genius was not just in selling products, but in recognizing patterns before the market fully named them. Shoemart introduced fixed pricing, air-conditioning and a more orderly, modern shopping experience—small innovations that signaled trust and aspiration in equal measure. Over time, the company expanded from shoes into department stores, then into supermarkets, and then into the bolder idea that would define the next phase of its history: the shopping mall. SM North EDSA opened in 1985, during a period of deep political and economic uncertainty in the Philippines, and it helped create what would later be known as the country’s malling culture. That move changed everything. Retail was no longer simply about merchandise; it was about traffic, experience and time spent. The store became a destination. The destination became a district. 

What followed was one of the most disciplined examples of adjacency-building in Philippine corporate history. In 1976, Sy acquired Acme Savings Bank, which would later become Banco de Oro and eventually BDO. In 1994, SM Prime went public to accelerate mall development. In 2005, SM Investments Corporation itself listed on the Philippine Stock Exchange in what was then one of the country’s largest IPOs. These were not random acts of expansion. Each move fed the others. A mall brought foot traffic to the department store. The store anchored the mall. The bank financed tenants, suppliers and customers. Property created land value around retail activity. Over time, SM stopped looking like a retailer with side businesses and started looking like a self-reinforcing commercial system.

Even today, retail remains the emotional center of the empire. In 2016, SM completed the merger of several retail units into SM Retail, a move the company said created the country’s most diversified retail platform. That year, the segment generated PHP276.5 billion in revenues and PHP10.6 billion in net income, supported by more than 2,300 stores nationwide. By 2018, the footprint had grown to 2,328 outlets, including 63 The SM Store locations, 1,383 specialty stores, 56 supermarkets, 53 hypermarkets, 195 Savemore branches, 52 WalterMart stores and 526 Alfamart sites. The real story, though, was geographic. About 80% of new openings were in provincial markets, where SM saw faster growth and less saturation. The company was not just defending market share in Metro Manila. It was extending modern consumption infrastructure deeper into the archipelago. 

That expansion only accelerated in the years that followed. In 2019, SM said it was investing in digital capabilities and changing consumption patterns, building out ShopSM, Click & Collect and cashless payment solutions while opening hundreds of stores across food and specialty retail. In 2023, SM Retail generated PHP415.0 billion in revenues and PHP19.9 billion in net income. In 2024, revenues rose to PHP434.5 billion and earnings to PHP20.9 billion, with the network reaching 4,470 retail outlets nationwide, including 2,092 Alfamart stores and 1,868 specialty stores. It is a scale story, certainly—but also a format story. SM kept finding new ways to sit closer to the customer, whether in a major mall, a neighborhood grocery or a provincial minimart. 

If retail was the company’s first language, property became its most visible expression of power. The early malls were shopping centers; the later ones became engines of urban form. By the 2010s and 2020s, SM Prime was no longer simply building places to shop. It was creating integrated property developments—mixed-use complexes that combined malls, residences, offices, hotels, convention centers and entertainment venues in one coordinated footprint. In 2016, SM Prime posted PHP79.8 billion in revenues and PHP23.8 billion in recurring net income. In 2017, revenues rose to PHP90.9 billion and recurring net income to PHP27.6 billion. In 2018, the company operated 72 malls in the Philippines and seven in China. By 2024, the network had expanded to 87 malls in the Philippines, eight in China, 22 integrated property developments, 67 primary residences, 22 office buildings, 10 hotels and six convention centers. Earnings that year reached PHP45.6 billion on revenues of PHP140.4 billion. What started as mall development had evolved into city-making. 

The banks, meanwhile, became the quiet machinery that made the whole system sturdier. BDO and China Bank are easy to treat as related businesses; in practice, they are part of SM’s core architecture. They finance construction, tenants, consumer activity and corporate relationships, while also diversifying earnings away from the cyclical swings of retail and real estate. In 2016, BDO earned PHP26.1 billion and China Bank PHP6.5 billion. In 2018, BDO earned PHP32.7 billion while China Bank posted PHP8.1 billion. By 2019, BDO’s net income had climbed to PHP44.2 billion and China Bank’s to PHP10.1 billion. When the pandemic hit in 2020 and consumer-facing businesses came under pressure, banking accounted for 55% of SMIC’s net income mix. By 2024, the banks still contributed the largest share of group earnings at 49%, with BDO earning PHP82.0 billion and China Bank PHP24.8 billion. Retail may draw the foot traffic. Banking keeps the balance sheet calm. 

That balance sheet is, in many ways, the clearest portrait of SM’s evolution. In 2016, SM Investments reported total assets of PHP861.46 billion, total liabilities of PHP446.71 billion and stockholders’ equity of PHP414.75 billion. By 2018, assets had crossed PHP1 trillion, reaching PHP1.0606 trillion, with liabilities of PHP568.3 billion and equity of PHP492.3 billion. In 2019, assets climbed further to PHP1.144 trillion. In 2020, even amid the pandemic, total assets increased again to PHP1.2245 trillion, a sign of how much prior investment and conservative financing discipline had insulated the group. By 2024, SM’s total assets had reached PHP1.699 trillion, with total liabilities of PHP832.7 billion and total equity of PHP866.4 billion. As of September 30, 2025, the company’s quarterly filing showed assets of PHP1.7618 trillion and total equity of PHP926.4 billion. That is not simply growth. It is balance-sheet deepening on a national scale.

The income statement tells a similarly revealing story. Consolidated revenues rose from PHP362.8 billion in 2016 to PHP396.1 billion in 2017, PHP449.8 billion in 2018 and PHP501.7 billion in 2019. Net income moved from PHP31.2 billion to PHP32.9 billion, then to PHP37.1 billion and PHP44.6 billion over the same span. Then came the sharp interruption of 2020: revenues fell to PHP394.2 billion and earnings dropped to PHP23.4 billion. But the rebound was rapid. Revenues recovered to PHP428.1 billion in 2021, surged to PHP553.8 billion in 2022, rose again to PHP616.3 billion in 2023 and reached PHP654.8 billion in 2024. Net income followed the same trajectory: PHP38.5 billion in 2021, PHP61.7 billion in 2022, PHP77.0 billion in 2023 and a record PHP82.6 billion in 2024. For a conglomerate of SM’s size, that kind of post-crisis acceleration is unusual. It suggests a company that did not merely survive the pandemic—it used it to streamline, digitize and reassert its scale advantages.

Public markets have long recognized SM as a proxy for the Philippine consumer economy. Its market capitalization stood at PHP789 billion in 2016, jumped to PHP1.193 trillion in 2017, remained above PHP1.1 trillion in 2018 and 2019, and was still about PHP1.1 trillion in 2023 and 2024. The share price moved from PHP655 in 2016 to PHP990 in 2017, then crossed PHP1,000 in 2019 and 2020 before settling back into the high-PHP800 to PHP900 range in recent years. But the more interesting valuation story is the compression in its earnings multiple. SM traded at about 25.3 times earnings in 2016, 36.2 times in 2017 and 54.0 times in pandemic-hit 2020. By 2024, however, the price-earnings ratio had fallen to 13.3 times—even as the company had become bigger, more diversified, more profitable and more equity-rich than ever. In other words, the business matured faster than the market’s enthusiasm for it. That shifts the narrative. SM today is no longer just a growth stock. It is a capital-allocation machine.

And SM is still not finished expanding its perimeter. In recent years, the holding company has moved more decisively into portfolio investments—2GO in logistics, Airspeed, Philippine Geothermal Production Company in renewable energy, Goldilocks in food manufacturing, and other holdings in leisure, commercial property and mining. In 2022, portfolio investments contributed 11% of consolidated earnings. In 2023, management said the medium-term goal was to lift that contribution into the mid-teens. In 2024, SM described these businesses as an important route into high-growth sectors with strong synergies to the group’s existing footprint. The implication is clear: the next phase of SM will not be built only on malls, department stores and banking halls. It will be built on what those assets make possible. 

In the end, what Henry Sy built was not just one of the Philippines’ largest companies. He built a habit-forming commercial ecosystem around the daily lives of millions of people. Filipinos shop in it, bank through it, live beside it, work inside it and increasingly move goods and capital through its extended network. That may be why SM feels less like a corporation than an infrastructure layer—a private-sector grid for modern consumption. It began, improbably enough, with a man selling shoes and paying close attention. It has ended, at least for now, with nearly PHP1.8 trillion in assets and a claim on the rhythms of the nation itself.

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Disclaimer: This is for informational purposes and is not investment advice. Figures are taken from company disclosures and exchange data; valuation ratios include the author’s calculations based on cited inputs.