Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

Asset World Corporation / Index Rebalance

<ul>
<li>Asset World, Banpu Public and Ngern Tid Lor are being added to the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-50-index" target="_blank" data-smartkarma-citation="entities:31493:1" rel="noopener">SET 50 Index (SET50 INDEX)</a> while Berli Jucker, Delta Electronics and Sri Trang Agro will be deleted.</li>
<li>Estimated one-way turnover is 5.83% and results in a one-way trade of THB 4,957m. The deletions of BJC/ DELTA will result in a funding inflow to the other index constituents.</li>
<li>
<a href="https://www.smartkarma.com/entities/asset-world-corp-pcl" target="_blank" data-smartkarma-citation="entities:28136:1" rel="noopener">Asset World Corporation (AWC TB)</a> is a surprise to an extent with the name not appearing on most lists on the street. We had it as a low probability inclusion.</li>
</ul>


Asset World, Banpu Public and Ngern Tid Lor are being added to the SET 50 Index (SET50 INDEX) while Berli Jucker, Delta Electronics and Sri Trang Agro will be deleted.
Estimated one-way turnover is 5.83% and results in a one-way trade of THB 4,957m. The deletions of BJC/ DELTA will result in a funding inflow to the other index constituents.

Asset World Corporation (AWC TB) is a surprise to an extent with the name not appearing on most lists on the street. We had it as a low probability inclusion.


SET50 December Index Rebalance: AWC, BANPU, TIDLOR Added; BJC, DELTA, STA Out

Delta Electronics (Thailand) / Index Rebalance

<ul>
<li>SET conducted a market consultation in September/October and amended the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-50-index" target="_blank" data-smartkarma-citation="entities:31493:1" rel="noopener">SET50 INDEX</a> index methodology earlier this month. These changes could see an extra 'targeted' deletion from the index.</li>
<li>The review period ends today and we see two high probability inclusions which means there will be at least two deletions. One of the deletions is a high probability name.</li>
<li>The changes should be announced mid-December and will be implemented at the close of trading on 30 December.</li>
</ul>


SET conducted a market consultation in September/October and amended the SET50 INDEX index methodology earlier this month. These changes could see an extra 'targeted' deletion from the index.
The review period ends today and we see two high probability inclusions which means there will be at least two deletions. One of the deletions is a high probability name.
The changes should be announced mid-December and will be implemented at the close of trading on 30 December.


SET50 Index Rebalance Preview: Revised Methodology & Potential Changes

Thai Equity - Bottom-up - Equities, Pi Securities PCL, Thailand

Pi Research

Thai Equity - Bottom-up - Equities

Leading, full-service investment firm in Thailand

Pi Securities PCL, Thailand

Pi Securities is a well known securities company with 40 years experience in the industry, serving more than 60,000 clients. We offer one - stop service providing full range of financial products and services including extensive Brokerage, Proprietary Trading (Equities and Bonds), Advisory Services, Structured Products.

Moreover, our new research team tailored for institutional clients to focus on mid to small cap of Thai equities and trading strategies. Our services offered to our premium clients also include arrangement of company or site visits to with the managements of Thai listed companies.

Note: Effective on 1 March 2022, Country Group Securities PCL changed its name to Pi Securities

Equity Bottom-Up

Asset World Corporation / Equity Bottom-Up

<p><strong>The management expect to see performance for hospitality business to pick up from the 2H21 trough in 1Q22. Meanwhile, we anticipate EBITDA breakeven period for the hotel unit to take place in mid 2Q22 when majority of population have vaccinated.</strong></p><div>• 2Q21 loss (excluding gain from asset revaluation) was at Bt758m (v.s. Bt594m loss in 1Q21, Bt729m profit in 2Q20)</div><div></div><div>• Expect the company to incur net loss in 3Q21 and 4Q21 with a higher extent than 2H20 due to impact from 3rd wave of COVID-19, which trim down occupancy for hospitality business down to below 10% (vs. 17% in 1H21).</div><div></div><div>• Trim down net loss forecast in 2021E further to Bt2.2bn</div><div></div><div><strong>We maintain HOLD rating for AWC with a new target price after EPS downward revision at Bt4.10 (Previous TP: Bt4.30), derived from DCF, which implies 51xPE’24E. HOLD rating reflect negative outlook towards earnings recovery in 2H21. However, faster-than-expected recovery in tourist inbound and vaccine rollout remain an upside risk for 22-23E earnings upward revision.</strong></div>

The management expect to see performance for hospitality business to pick up from the 2H21 trough in 1Q22. Meanwhile, we anticipate EBITDA breakeven period for the hotel unit to take place in mid 2Q22 when majority of population have vaccinated.• 2Q21 loss (excluding gain from asset revaluation) was at Bt758m (v.s. Bt594m loss in 1Q21, Bt729m profit in 2Q20)• Expect the company to incur net loss in 3Q21 and 4Q21 with a higher extent than 2H20 due to impact from 3rd wave of COVID-19, which trim down occupancy for hospitality business down to below 10% (vs. 17% in 1H21).• Trim down net loss forecast in 2021E further to Bt2.2bnWe maintain HOLD rating for AWC with a new target price after EPS downward revision at Bt4.10 (Previous TP: Bt4.30), derived from DCF, which implies 51xPE’24E. HOLD rating reflect negative outlook towards earnings recovery in 2H21. However, faster-than-expected recovery in tourist inbound and vaccine rollout remain an upside risk for 22-23E earnings upward revision.

AWC: Clearer Picture for Hotel Business Is Expected to Be Seen in Early 2022

<p>Last evening post market close, the Stock Exchange of Thailand (SET) announced the results of the semi-annual review of the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-50-index" target="_blank" data-smartkarma-citation="entities:31493:1" rel="noopener">Stock Exchange of Thailand SET 50 Index (SET50 INDEX)</a> with the changes taking effect after the close of trading on 30 June.</p><p><a href="https://www.smartkarma.com/entities/irpc-pcl" target="_blank" data-smartkarma-citation="entities:19051:1" rel="noopener">IRPC PCL (IRPC TB)</a>, <a href="https://www.smartkarma.com/entities/kce-electronics-pcl" target="_blank" data-smartkarma-citation="entities:1892:1" rel="noopener">KCE Electronics PCL (KCE TB)</a>, <a href="https://www.smartkarma.com/entities/sri-trang-agro-industry-pcl" target="_blank" data-smartkarma-citation="entities:2759:1" rel="noopener">Sri Trang Agro Industry (STA TB)</a> and <a href="https://www.smartkarma.com/entities/sri-trang-gloves-thailand-public-company-limited" target="_blank" data-smartkarma-citation="entities:29141:1" rel="noopener">Sri Trang Gloves (Thailand) Public Company Limited (STGT TB)</a> have been added to the index, replacing <a href="https://www.smartkarma.com/entities/asset-world-corp-pcl" target="_blank" data-smartkarma-citation="entities:28136:1" rel="noopener">Asset World Corporation (AWC TB)</a>, <a href="https://www.smartkarma.com/entities/bangkok-commercial-asset-management-public-company-limited" target="_blank" data-smartkarma-citation="entities:28442:1" rel="noopener">Bangkok Commercial Asset Management (BAM TB)</a>, <a href="https://www.smartkarma.com/entities/toa-paint-thailand-pcl" target="_blank" data-smartkarma-citation="entities:24235:1" rel="noopener">TOA Paint (Thailand) (TOA TB)</a> and <a href="https://www.smartkarma.com/entities/vgi-pcl" target="_blank" data-smartkarma-citation="entities:12409:1" rel="noopener">VGI PCL (VGI TB)</a>.</p><p><a href="https://www.smartkarma.com/entities/asset-world-corp-pcl" target="_blank" data-smartkarma-citation="entities:28136:1" rel="noopener">Asset World Corporation (AWC TB)</a> and <a href="https://www.smartkarma.com/entities/toa-paint-thailand-pcl" target="_blank" data-smartkarma-citation="entities:24235:1" rel="noopener">TOA Paint (Thailand) (TOA TB)</a> are deletes on liquidity. We had <a href="https://www.smartkarma.com/entities/asset-world-corp-pcl" target="_blank" data-smartkarma-citation="entities:28136:1" rel="noopener">Asset World Corporation (AWC TB)</a> just about passing the liquidity test, while the SET sees it as failing the test.</p><p><a href="https://www.smartkarma.com/entities/irpc-pcl" target="_blank" data-smartkarma-citation="entities:19051:1" rel="noopener">IRPC PCL (IRPC TB)</a> was deleted from the index at the December 2020 rebalance and has gained 8.6% since then, while <a href="https://www.smartkarma.com/entities/bangkok-commercial-asset-management-public-company-limited" target="_blank" data-smartkarma-citation="entities:28442:1" rel="noopener">Bangkok Commercial Asset Management (BAM TB)</a> was included in the index at the same review and has lost 11.4% since then.</p><p>One-way turnover for the rebalance is 2.86%. The impact of passive fund trading on the deletions is expected to be a lot higher than that on the inclusions.</p><p>With <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a> shareholders meeting for their EGM on 25 June, the tender offer for <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> should be approved. <a href="https://www.smartkarma.com/entities/banpu-public-co-ltd" target="_blank" data-smartkarma-citation="entities:15363:1" rel="noopener">Banpu Public (BANPU TB)</a> is the frontrunner to join the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-50-index" target="_blank" data-smartkarma-citation="entities:31493:1" rel="noopener">Stock Exchange of Thailand SET 50 Index (SET50 INDEX)</a> once the <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> tender offer is complete and the free float drops below 20%.</p>

Last evening post market close, the Stock Exchange of Thailand (SET) announced the results of the semi-annual review of the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) with the changes taking effect after the close of trading on 30 June.IRPC PCL (IRPC TB), KCE Electronics PCL (KCE TB), Sri Trang Agro Industry (STA TB) and Sri Trang Gloves (Thailand) Public Company Limited (STGT TB) have been added to the index, replacing Asset World Corporation (AWC TB), Bangkok Commercial Asset Management (BAM TB), TOA Paint (Thailand) (TOA TB) and VGI PCL (VGI TB).Asset World Corporation (AWC TB) and TOA Paint (Thailand) (TOA TB) are deletes on liquidity. We had Asset World Corporation (AWC TB) just about passing the liquidity test, while the SET sees it as failing the test.IRPC PCL (IRPC TB) was deleted from the index at the December 2020 rebalance and has gained 8.6% since then, while Bangkok Commercial Asset Management (BAM TB) was included in the index at the same review and has lost 11.4% since then.One-way turnover for the rebalance is 2.86%. The impact of passive fund trading on the deletions is expected to be a lot higher than that on the inclusions.With Gulf Energy Development Public Company (GULF TB) shareholders meeting for their EGM on 25 June, the tender offer for Intouch Holdings (INTUCH TB) should be approved. Banpu Public (BANPU TB) is the frontrunner to join the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) once the Intouch Holdings (INTUCH TB) tender offer is complete and the free float drops below 20%.

SET50 June Index Rebalance: Four Changes Announced; One More Coming Up Soon

<p><strong>We anticipate EBITDA breakeven period for hospitality business to be postponed until mid 2Q22 while expecting AWC’s earnings recovery at a faster pace than other hospitality related stock in Thailand given its high degree of diversification of asset portfolio and the management’s competency to effectively implement cost saving program.</strong></p><div>• Report 1Q21 net loss at Bt594m (Bt492m loss in 4Q20, Bt265m profit in 1Q20)</div><div>•Expect the company to incur another net loss in 2Q21 with a higher extent than 1Q21 due to impact from lockdown period in April and May, which trim down occupancy for hospitality business down to below 10%.</div><div></div><div>• Trim down net loss forecast in 2021E further to Bt1.6bn</div><div></div><div><strong>We maintain HOLD rating for AWC with a new target price after EPS downward revision at Bt4.30 (Previous TP: Bt4.60), derived from DCF, which implies 72xPE’24E. HOLD rating reflect postponement in hotel revenue recovery. However, faster-than-expected vaccine handout and recovery flow of tourist inbound remain an upside risk for 22-23E earnings upward revision.</strong></div>

We anticipate EBITDA breakeven period for hospitality business to be postponed until mid 2Q22 while expecting AWC’s earnings recovery at a faster pace than other hospitality related stock in Thailand given its high degree of diversification of asset portfolio and the management’s competency to effectively implement cost saving program.• Report 1Q21 net loss at Bt594m (Bt492m loss in 4Q20, Bt265m profit in 1Q20)•Expect the company to incur another net loss in 2Q21 with a higher extent than 1Q21 due to impact from lockdown period in April and May, which trim down occupancy for hospitality business down to below 10%.• Trim down net loss forecast in 2021E further to Bt1.6bnWe maintain HOLD rating for AWC with a new target price after EPS downward revision at Bt4.30 (Previous TP: Bt4.60), derived from DCF, which implies 72xPE’24E. HOLD rating reflect postponement in hotel revenue recovery. However, faster-than-expected vaccine handout and recovery flow of tourist inbound remain an upside risk for 22-23E earnings upward revision.

AWC: Slower-Than-Expected Recovery in Hospitality Revenue

Thailand

Asset World Corporation invests in, develops, and manages real estate properties in Thailand, focusing on hospitality, lifestyle destinations, and commercial workspaces. The company operates through two segments: Hotel and Related Services, and Rental and Rendering of Commercial Building Services. It develops and owns hotels, community shopping malls, and mixed-use properties. Headquartered in Bangkok, Thailand, the company was founded in 2009.

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Asset World Corporation (AWC TB)

SET50 December Index Rebalance: AWC, BANPU, TIDLOR Added; BJC, DELTA, STA Out

There are 3 changes to the SET50 index at the December rebalance. AWC, BANPU and TIDLOR will replace BJC, DELTA and STA. AWC is a 'surprise' and...

Brian Freitas

SET50 Index Rebalance Preview: Revised Methodology & Potential Changes

TIDLOR and BANPU are high probability inclusions to the SET50 in Dec while STA is a high probability deletion. DELTA and BJC could be deletes on...

Brian Freitas

AWC: Clearer Picture for Hotel Business Is Expected to Be Seen in Early 2022

The management expect to see performance for hospitality business to pick up from the 2H21 trough in 1Q22. Meanwhile, we anticipate EBITDA...

Pi Securities PCL, Thailand

SET50 June Index Rebalance: Four Changes Announced; One More Coming Up Soon

There are 4 changes to the SET50 index with IRPC, KCE, STA & STGT replacing AWC, BAM, TOA & VGI. BANPU could be included in the next couple of...

Brian Freitas

AWC: Slower-Than-Expected Recovery in Hospitality Revenue

We anticipate EBITDA breakeven period for hospitality business to be postponed until mid 2Q22 while expecting AWC’s earnings recovery at a faster...

Pi Securities PCL, Thailand

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