SM Prime Holdings Inc., the country’s largest shopping mall developer and operator, yesterday said its board of directors approved a P1-billion share buyback program in a bid to enhance the company’s share value.

“The buyback program is designed to enhance the shareholder value as management believes that the company’s shares are currently undervalued in the market,�? SM Prime said in a disclosure to the stock exchange.

The company said it had not set the timetable and equivalent number of shares it would acquire in the stock market.

SM Investments Corp. chief finance officer Jose Sio said SM Prime would place the shares under its treasury.

Share prices of SM Prime yesterday edged lower at P7.20 from Friday’s close of P7.40, reflecting the movement of the composite index, which fell 38.49 points or 1.4 percent to 2, 739,44 as investors continue to worry about inflation and its impact on economic growth.

Several listed companies, including First Gen Corp., Chemrez Technologies Inc., Unversal Robina Corp., Vista Land and Landscapes Inc., Roxas Holdings Inc. and Filinvest Land Inc., have implemented a share buyback program as concerns of a possible US recession and rising inflation continue to batter the local stock market.

SM Prime reported that it would invest P33 billion over the next five years to construct new malls in the Philippines.

The company plans to spend P6 billion this year in capital expenditure with the scheduled opening of three shopping malls, namely SM Rosales, SM Baliuag, and SM Marikina.

SM prime is also looking to construct three to four malls in China over the next five years. Construction of one shopping mall in China could reach over P1 billion on the average.

SM Prime as of the end of 2007 operated 30 malls nationwide, 13 of which are in Metro Manila, or a combine gross floor area of 3.9 million square meters and with an average daily pedestrian count of 2.5 million.

Net income in 2007 reached P6 billion, up 10 percent from P5.4 billion in 2006.

Gross revenues in 2007 went up 16 percent to P15.3 billion, primarily due to the opening of three new malls and the expansion of three stores.

Rental revenue in the period grew 17 percent to P12.8 from P11 billion in 2006 while cinema ticket sales improved 15 percent to P1.8 billion from a year ago level of P1.6 billion.