SET could pass 1,400 this year amid positive signs: analysts

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SET INDEX
SET could pass 1,400 this year amid positive signs: analysts
Erich Parpart
The Nation


Investor walks pass the SET electronic board at the period of SET index rising yesterday.

BANGKOK: -- The SET Index could climb to 1,400-1,450 points by year-end now that the political turmoil shows signs of abating soon, while listed companies could show earnings growth of 12.2 per cent, dividend yield of 3.3 per cent and total return of 14.9 per cent.

Therdsak Thaveeteeratham, executive vice president for research at Asia Plus Securities, said yesterday that the company also believed that the Bank of Thailand would cut its policy interest rate again to 2 per cent this year.

This will help boost the economy in the second half, although household debt has soared to 70-80 per cent of gross domestic product.

Chatchaphol Srivaleepan, vice president of business development and marketing development at Krung Thai Asset Management (KTAM), said the foreign selling trend was expected to lose steam and if the political situation improves, foreign investors would come back to Thailand because the stock market here is one of the cheapest in the region and has plenty of potential.

Foreign investors yesterday were net buyers, at Bt1.3 billion. Foreign net buys on Monday were Bt1.14 billion.

Kesara Manchusree, executive vice president and head of the markets division at the Stock Exchange of Thailand, said foreign investors were still interested in the Thai bourse. Other countries in the region such as Indonesia, the Philippines, Malaysia and Bangladesh are also experiencing the same problem of foreign-capital outflows.

"Investors can see that the region is unstable and it isn't just Thailand that is experiencing the same thing, so their confidence and interest in the Thai stock market still remain, and as soon as the internal situation is solved, they will come back," he said.

Yesterday the SET gained 6.6 points or 0.49 per cent from Monday to close at 1,345.82. It has been rallying for seven straight days from 1,301.38 on February 24.

KTAM sees opportunity in crisis and believes that SET 50 stocks are the most interesting for this year.

The SET 50 groups the top 50 companies by market capitalisation and liquidity. Last month they accounted for 74 percent of the SET Index and 62 per cent of trading. Their dividend yield averaged 3.4 per cent.

"With the reduction in political tension in the nation, KTAM sees perfect timing for investors to invest in SET 50 stocks at comparatively low prices," chief executive officer Somchai Boonnamsiri said.

"The SET 50 will also play a big role when the Asean Economic Community is launched in 2015," he said, noting that the Set 50 Index normally outperforms the main SET Index during tough times, as seen in 2008.

"This shows that the country's corporate strength is mainly based on the strength of the SET 50 Index," he said.

Earnings per share for the SET 50 companies should grow by 14.2 per cent this year with a price-to-earnings ratio of 13.5 times. The SET 50's EPS are targeted at 74.45 per cent and the index is estimated to close at above 1,000 points by year-end.

The stock market this year is expected to change from "fund-flow driven" to "fundamentals driven" because the desire of foreign investors to pull out of the market is about to be satiated, KTAM believes.


-- The Nation 2014-03-05

[Thai at Heart]

It's so positive????

I know the sky might not be falling, but positive???

[terryp]

LOL this is far from over

[SantiSuk]

Boiler room cr@p!

[arthurboy]

...the political turmoil shows signs of abating soon...

I must have missed something. Ho hum...

sent from my hippo phone

Edited March 5, 2014 by arthurboy

[Chriso12]

The upward trend is certainly given. I am a trader and have been through all the political turmoils here in Thailand. Given that demonstrations had some impact on tourism and that grenades detonated almost daily in the capital, the SET has fared very well. The political drama is a never ending story...I think every trader knows that. If you dont like unstable countries for investment (which I would fully understand) then stay away from Thailand. However if you are like me, who got used to the political volatility, things are on the way back to normal. Your definition of "stable" has to be redefined when you deal with thai politics.

SET end of the year: 1450 Property funds like CPNRF, POPF or SPF are good for long term investments. They shaved off a lot of their past premiums.

BTS was my favourite stock pick last year and is still this year.

Edited March 5, 2014 by Chriso12

[Thaddeus]

Less than 10 months ago, it was over 1,600 and some predicted it would be over 1,700 by the end of 2013.

[whiteman]

demco for me is my pick

[Senechal]

LOL. Analysts at a BROKERAGE say the market is going up. And in other news, real estate agents say it's a good time to buy a house.

Even if Thailand wasn't in the midst of political turmoil, this phase of credit expansion is over. Household debt is already high, and exports are falling (NOT due to the protests, as some would have you believe). There's a massive disconnect between real estate prices and salaries. There is a massive glut of cars that cannot be paid for or serviced. The rice buying scheme is over. Labor prices in Thailand aren't close to being competitive with her neighbors... And SME's are all getting ready to leave the country as soon as ASEAN kicks in. Add to that the impending collapses in China and Australia and you've got a recipe for pain.

And then of course there's the political mess.

Want to play on the SET? Only if you can get a borrow!

[Chriso12]

LOL. Analysts at a BROKERAGE say the market is going up. And in other news, real estate agents say it's a good time to buy a house.

Even if Thailand wasn't in the midst of political turmoil, this phase of credit expansion is over. Household debt is already high, and exports are falling (NOT due to the protests, as some would have you believe). There's a massive disconnect between real estate prices and salaries. There is a massive glut of cars that cannot be paid for or serviced. The rice buying scheme is over. Labor prices in Thailand aren't close to being competitive with her neighbors... And SME's are all getting ready to leave the country as soon as ASEAN kicks in. Add to that the impending collapses in China and Australia and you've got a recipe for pain.

And then of course there's the political mess.

Want to play on the SET? Only if you can get a borrow!

You can write an ongoing "its all messed up" list for every country. Price earnings ratio from most companies in Thailand are fairly attractive at the moment and they continue to grow.

A Broker is happy if the customer sells or buys. SCBS (Siam Commercial Broker) broadcasts a research note daily where he tells to sell or buy given on the outlook. A broker will not always paint a rosy picture but rather try to encourage people to rather "trade" than to "invest" as this is what generates most money for him.

[bangon04]

Where is Naam when we need him?

[Dap]

AND Pigs COULD fly ... if only they had wings

Just wait and see ... as usual.

[fletchsmile]

Have to say I share a lot of the views that are written. A lot of the bad news was priced in last year.

I do wish the Nation would get some better people who actually understand what they are talking about though, rather than just throw quotes together from lots of people. (Generally its the quotes I share views with rather than the Nation's own analysis).

Massive case in point: doesn't the author of the article know that a screen full of red signifies a falling market? The picture looks blurred, But if you are going to describe someone walking passed an electronic board of the market rising, please an electronic board that is mainly green!!! This looks like any old photo from who knows when, and the market was actually falling at the time of this photo. Look amateurish to pick any old photo and stick it in an article if the photo doesn''t at least match the caption

Cheers

Fletch

Edited March 5, 2014 by fletchsmile

[jbaldwin]

The upward trend is certainly given. I am a trader and have been through all the political turmoils here in Thailand. Given that demonstrations had some impact on tourism and that grenades detonated almost daily in the capital, the SET has fared very well. The political drama is a never ending story...I think every trader knows that. If you dont like unstable countries for investment (which I would fully understand) then stay away from Thailand. However if you are like me, who got used to the political volatility, things are on the way back to normal. Your definition of "stable" has to be redefined when you deal with thai politics.

SET end of the year: 1450 Property funds like CPNRF, POPF or SPF are good for long term investments. They shaved off a lot of their past premiums.

BTS was my favourite stock pick last year and is still this year.

Interesting. I bought property funds today but different ones - TFUND, QHPF and CPNCG. I agree that they are good long term investment to current prices.

[kblaze]

people are buying now for the 2H thai econ rebound. no violence or red uprising = SET positive even with judicial coup

[Senechal]

people are buying now for the 2H thai econ rebound. no violence or red uprising = SET positive even with judicial coup

Thai econ rebound?

No violence or red uprising?

SET positive even with judicial coup?

That's quite a crystal ball you have there kblaze!