Revisiting recent history

I was just doing research looking for information on a property company in Thailand, which led me to reading about politicians and then inspired a phone conversation with a friend about how much under the table money had to be paid just for an energy project in Thailand and then somehow led me to this “old” (it is only 6 years ago) on Thai politics from the BBC (its crazy how the internet works)

The godfathers did not go away. Instead, recognising this new political phenomenon, they opted to move under the Thai Rak Thai umbrella. Newin Chidchob was one of them. 

Mr Thaksin’s wealth and personal popularity gave him a far stronger hand in dealing with the godfathers than any other party in Thailand’s history, so his governments were not crippled by the demands of coalition partners, as his predecessors had been.

So the question that comes to mind is Which side are the godfathers taking now?

 Article Source: BBC

 

LTF purchases supporting the market

So despite all this political rubbish, foreign investors selling the market, local investors have buying LTF’s taking advantage of the weakened equity market.

The numbers are:

  • Local investors have a net buy THB 1.18 bn in LTF’s this year
  • Typically in the past 3 years of Jan-Mar, net sales of LTFs were THB 3 bn in 2011, THB 19 bn in 2012 and THB 13 bn in 2013
  • Typically in the last three months of a year, net buys of THB 17 bn in 2011, THB 27 bn in 2012 and THB 25 bn in 2013.
  • Some THB 40 bn worth of LTF’s are redeemable this year.

 Source: Bangkok Post

Stocks in the news (BJCHI, BLA, BTS, CPN, EA, JMT, NOK, TTA, UAC) 26.02.14

BJCHI

DPS Bt2.40; XD May 5, on net profit of Bt1.21bn, a 52.16% increase YoY. It expects no less than 15% revenue growth this year, booking Bt1.7bn from its current backlog of Bt2.3bn. It will soon bid for projects in Australia and South America and get results on its Brazil bid. (Khao Hoon, 26/02/14)

Comment: Brokers have been promoting this stock quite actively over the past few weeks, in a nutshell it’s the same as STP&I

BLA

BLA targets first-year insurance premium growth of 47%. It plans to heavily sell its products through BBL. Profit is expected to grow in 1Q14 as profit from its investment portfolio remains high. (Khao Hoon, 26/02/14)

Comment: Thailand is still a relatively underinsured country when compared to developed ones, and BLA is the only investment option with liquidity here.

BTS

New subsidiary to develop property — BTS set up a new subsidiary, Mak8 Co Ltd., in order to develop real estate projects, including a condominium in Pak Chong, Nakorn Ratchasima, where it has already purchased 16 rai. Registered capital is Bt240mn, 87.5% held by BTS and the rest by Ms. Chittiwadee Utintu. This company will invest in new property. (Company)

Comment: Well, they do have THB 40 bn worth of cash to put to work. Continue reading Stocks in the news (BJCHI, BLA, BTS, CPN, EA, JMT, NOK, TTA, UAC) 26.02.14

Passenger growth still +5.5% YoY

AOTFY2013 numbers are coming out fast and furious over the past week, and I’ll show the results of a few co’s that are relevent to the news we read about Thailand today.

So here are the facts about travellers, even though we’ve had protests and continuous negative news in the media, traveller numbers to AOT’s airports are still up 5.5% YoY for Jan ’14. Though we like to joke that perhaps the politicians flying up to Chiang Mai and Chiang Rai are boosting the numbers up slightly hahaha. All joking aside, this does go to show that tourism is still alive and well in the rest of Thailand. A quick trip to Suvarnabhumi that other night showed me an airport that was still incredibly full (on the departure side).

Stocks in the news (bjchi, gunkul, ivl, sat, thai, tta, ttw, tuf, uac) 25.02.14

BJCHI

Roadshow end-Feb — BJCHI is preparing for a roadshow for big local institutional investors on 27-28 February 2014, after they expressed interest in its overseas business. It expects to get a project of Bt2bn in Australia. Its current backlog is Bt5bn with gross margin of 40%. It will pay a DPS of Bt2.2. (Khao Hoon, 25/2/14)

Comment: We think the easy trade in BJCHI is over, some analysts are still pitching it as a potential re-rating to be inline with STPI

GUNKUL

GUNKUL reported 2013 net profit of Bt883mn. It will pay stock dividend at a ratio of 3 existing shares to 1 new share and cash dividend of Bt0.038 per share, XD on 18 April 2014. It expects 2014 revenue growth of 50% YoY. (Khao Hoon, 25/2/14)

Comment: Stock dividends…mmmmm….never liked them, yes it improves liquidity, with stocks with such a high PE and such uncertainty in quarterly numbers it can only add to selling pressure

IVL

IVL expects 2014 revenue of US$8.7bn or +17% YoY. It is confident that net profit in 2014 will be greater than 2013. It is preparing to book revenue from new business and will invest US$300-400mn in 2014. (Khao Hoon, 25/2/14)

Comment: IVL is continuously expanding in new businesses and if you look closely the majority of their acquisitions are paying off, one of the few bright spots in the energy/petrochem sector Continue reading Stocks in the news (bjchi, gunkul, ivl, sat, thai, tta, ttw, tuf, uac) 25.02.14

Sector Update 17/02 – 21/02

So we wake up this morning only to read about deaths from attacks at rally sites in Trat and Rajadamri/Ratchaprasong. Sad, stupid, pathetic [insert your own adjective] Thailand. Our eyes now turn to Feb 27th which will have the ruling on the THB 2 trn bill and Yingluck answering charges on the rice pledging scheme (if she shows up)

00sum 01set 02mai

Continue reading Sector Update 17/02 – 21/02

Stocks in the news (advanc, ait, demco, hmpro, ptt, pttgc, pylon, thai, wha) 24.02.14

ADVANC

TOT eyes new revenue from AIS pact – TOT Plc expects to earn revenue of at least Bt800mn a year from its network rental service once the state telecom enters a partnership with mobile leader Advanced Info Service (AIS). TOT chief executive Yongyuth Wattanasin said a one-year memorandum of understanding between the two parties is expected to emerge next month after TOT’s board approved the deal. (Bangkok Post, 24/02/14)

Comment: The only issue surrounding ADVANC is what Suthep has come out saying that it’s a shinawatra related business, which is rubbish.

AIT

AIT guarantees new high for 2014 net profit and revenue. It is confident that revenues will hit Bt6.2bn, supported by more than Bt4bn of backlog with 90% to be realized this year. It is ready to set up a business JV with LOXLEY and SAMART to penetrate the AEC market in the future. (Khao Hoon, 24/02/14)

Comment: They have yet still to disclose what they are going to do with the massive equity increase that they did last year.

DEMCO

To bid for new projects this year and aims to win Bt3.5bn to help push backlog up to more than Bt6.8bn. Revenue this year is expected to grow by 10%. (Khao Hoon, 24/02/14)

  Continue reading Stocks in the news (advanc, ait, demco, hmpro, ptt, pttgc, pylon, thai, wha) 24.02.14

Looking Beyond Politics in Thailand

Dr. Mobius has been a long term investor in Thailand and almost always pops up with a commentary during times of turmoil here (which appears to be every 2 years ever since I begun working here in 2004).  In this piece he covers the infrastructure bill, Thailand’s economic resilience, and below is his comments on the resilience in tourism.

mark_mobius1

If the past is any indication, the impact on tourism of the recent protests could prove relatively short-lived. When Ms. Yingluck Shinawatra’s brother Thaksin Shinawatra was ousted in 2006 in a military coup, there was little impact on tourism. And in 2013, Thailand welcomed a record number of visitors. So, if the demonstrations are having an impact, the overall picture doesn’t seem bleak at this time. MasterCard’s Global Destination Cities Index ranked Bangkok the world’s most-visited city in 2013, with nearly 16 million international visitors.3 Of course, if there is a great deal of violence there is no question that the impact will likely be felt this year. Nevertheless, our experience in Thailand through a great deal of political change and turmoil over the years indicates that the bedrock of Thai sensibility and practicality has eventually prevailed, and historically, when the turmoil has ended, it has generally been back to business as usual.

Source: Franklin Templeton

What happened this week 17/02 – 21/02

Thailand

  • Taxes miss target during slowdown — Tax collection fell 3.8% short of target in the first four months of FY2014 due mainly to the tepid economy and effects from the political turbulence, says a Finance Ministry source. The ministry’s revenue figure is a fresh clue that the economy is faltering. (Bangkok Post, 14/02/14)
  • Ministry upbeat on budget dispersals – The Finance Ministry remains optimistic that state enterprises’ investment budgets can help shore up the stuttering economy even though the government cannot yet fully disburse it, says a senior ministry official. (Bangkok Post, 17/02/14)
  • GSB stunned by Bt30bn deposit run – The Government Savings Bank (GSB) has decided to suspend further lending to the Bank for Agriculture and Agricultural Cooperatives (BAAC) after experiencing a Bt30bn deposit run amid concerns the loan is being used to pay for the loss-ridden rice-pledging scheme. (Bangkok Post, 18/02/14) Continue reading What happened this week 17/02 – 21/02