Random Thoughts…given I read a tonne of research papers…notes…etc…I’m going to start dumping thoughts, notes here, will try to source/date…remember don’t invest based upon my ramblings, instead follow the worst piece of advice ever created by the investment industry…do your own homework. Emphasis always mine.

Source/date: Tchart (maybe?) 8 April 2024

DMK Duty Free Space management up for bidding

• AOT has opened the bid for the concession to manage 1,200 sqm of commercial space at Don Mueang Airport’s (DMK) terminal 2 from July 2024-October 2034 after the previous concession managed by the Mall Group (unlisted) ended in September 2023. AOT gets the minimum guaranteed revenue with a 10% hike p.a. from the Mall Group. We expect this concession’s current minimum guaranteed revenue to be less than Bt250m. With DMK’s continued strong passenger recovery, we also expect the bid to draw interest from potential operators.

King Power, Duty Free

• The government is studying whether to remove duty-free shops on arrival at airports in Thailand. The purpose is to stimulate tourism spending within the country, especially for local goods. The government, AOT, and King Power, the duty-free concessionaire, are now in talks, but they have yet to reach a conclusion. If AOT has to scrap some duty-free shops on arrival from King Power, it, in return, may have to lower the minimum guaranteed revenue to King Power.

Rambling:

• Mall Group doesn’t know retail outside of low/mid income areas in Bangkok…
• AOT is still likely going to mint it…DMK with a better duty free retailer = higher fees to AOT.
• King Power…as if AOT is going to replace them…and everyone buys duty free on arrival globally if it exists…cigarettes and alcohol..unless these vices are going to banned then its not going away..
• Can’t see a reason for AOT not to continue trading stupidly expensive.

Source/date: Research paper…April 2024…
Lackluster dynamics of used car prices The Thai auto industry is facing a downturn characterized by weak demand for new cars and an oversupply of used cars. This situation is a result of the weak economy, increased car repossession activity, and a shift in consumer behavior towards electric vehicles (EVs). The used car price index has plunged by 27% over the past year. We believe used car prices have reached their lowest point, as losses on sales have skyrocketed to 50% from the usual average of 25%. With increasing adoption of EVs, attractive promotions for new cars, and stricter underwriting criteria for used cars, we do not anticipate a recovery in used car prices.

Rambling:

• EV cars = rubbish second hand value (telsa tbc…chinese vehicles definitely…would you buy the Xiaomi 1 phone after Xiaomi 2 was released?
• Repossession Activity increasing – great for Union Auction (AUCT). As banks will have to sell them at one point.
• If normal cars (ICE) second hand prices stabilise, perhaps someone should create a used car price index exclu EV’s