Should the SET Index continue to be this bullish?
Given that the market has begun to waver around the 1,200 point over the past week and with foreign fund flows slowing slightly we have to ask, should the SET Index continue to be so bullish? Brokerage houses are now upping their targets for the SET Index this year, others are starting to place targets for next year.
Economically I’m not worried for Thailand, it has:
1. A recovery from last year’s floods
2. The upcoming AEC integration is only going to be fantastic for the entire ASEAN region and Thailand should be one of the countries next to Singapore that will benefit massively.
3. Myanmar opening up next door, new market, plenty of resources Thai companies should be able to leverage off its proximity to Myanmar.
4. We still have low interest rates, perhaps not stupidly low as Europe and the US but still low.
5. Corporate tax cuts this year and next, increased minimum wage for University graduates starting next week.
But:
1. Valuations are stretched, each industry/sector is now trading at mid-teen PE’s
2. Dividend yields are equivalent to the 10 year Thai Government Bond rate.
3. Politics politics politics.
These are interesting times, I’m cautious at these levels but still comfortable as there are still several strong companies that are cheap with strong business models and catalysts for their stock price movements.
Tony
I enjoy your website and comments very much, but in your article “Should the SET index be so Bullish?” you stated there are several companies that are cheap with strong business models. Why not name these companies so we readers can do the due diligence, check the ratios and decide for ourselves if that particular stock is worthy of our interest. Please, in all fair interest why not name names so we can gain something from this site? No one will hold you responsible for your views, but many people might learn something. If you are worried then add a disclaimer at the end of your site.
Tony
Pon
Hi Tony,
We are just finishing the write up for a post here that we think may be of interest to readers of the site. Looking forward to your comments/thoughts on it later this week 🙂
Tony
Hi Pon.
Thanks for your reply. I look forward to your posts. Your website is interesting and I hope for it to expand because it has the potential to become a major site for serious investors who are interested in the Thai SET. Honestly speaking, there are not many Thai websites that offer enough information to help steer an investor to particular stocks or sectors as they usually offer macro information that can not really be used . I enjoy doing my own research and hope for this site to morph into helping the individual investor with the micro information we need.
Tony
Pon
Hi tony,
Thanks for the support, much appreciated!