Sector Update 06/05-10/05

Its 1Q13 earnings season and YoY comparisons are looking good b/c of last year’s low base (just a few months post the floods in 4Q11), going forward with the BoT looking to curb ST investments in the bond market resulting in the Thai baht finally weakening and no news flow locally, we wouldn’t be surprised to see the market begin to trade sideways over the next few weeks.

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Continue reading Sector Update 06/05-10/05

Stocks in the new (CPALL, CPN, SAMART) 14.05.2013


CP outlines Bt2.5bn expansion — CP All, the operator of 7-Eleven convenience stores, intends to invest Bt2.5bn to build four distribution centers across the country to support its future expansion in which the number of stores would reach 10,000 by 2017. The first center, which is under construction at a cost of Bt1bn in Mahachai, Samut Sakhon, will support 2,000 7-Eleven stores in southern Thailand. The other three centers are planned for the lower northeast, lower south and the central region. (Bangkok Post, 14/05/13)

Comment: The key story for cpall is no longer its growth in thailand via the 7-11 stores, but more of the integration of makro into its business and quite simply as a stock, we like the fact there’s no equity dilution and its purely additional earnings to its bottom line


CPN makes foray into Malaysian retail — CPN has entered into a joint venture agreement with a Malaysian developer to build a MYR580mn (Bt5.73bn) shopping mall in Selangor, Malaysia. CPN agreed to be the major stakeholder with 40% in the new entity through its local subsidiary, while I-City Properties Sdn Bhd, will hold 40%. (Bangkok Post, 14/05/13)

Comment: I am always happy to see Thai companies expand internationally, though having seen Japanese mall firms expanding aggressively throughout Asia 15-20 years ago to only fail with their investments, i am slightly worried about CPN’s ability to perform well overseas.

Continue reading Stocks in the new (CPALL, CPN, SAMART) 14.05.2013