Head of Research, Krungthai XSpring

Waraporn Wiboonkanarak

Head of Research

A full service Thai brokerage

Krungthai XSpring

Krungthai XSpring is a full service broker. The company provides a wide range of investment services such as Securities Brokerage, Derivative Agent Business, Securities Borrowing and Lending, Securities Trading, Underwriting, Financial Advisory, Wealth Advisory, Private Fund Management and International Markets Securities Trading. 

In terms of credibility, Fitch Ratings has assigned Krunghtai XSpring a long-term rating of AA- and a national short-term rating of F1+ with stable outlook.

Equity Bottom-Up

<div><div><div><div><p>The move to acquire the 768MW Temple I power plant in Texas is aligned with the BANPU Group’s growth transition to a “greener and smarter” portfolio and paves the way to entering the power business under a wholesale electricity market with an advanced trading system in the US. We preliminarily expect Temple I to generate immediate cash flow (starting in 2022E), implying upside risk of 8-10% to BANPU’s earnings and 6-7% to BPP’s earnings. We maintain a Hold rating on BANPU.</p></div></div></div></div>

The move to acquire the 768MW Temple I power plant in Texas is aligned with the BANPU Group’s growth transition to a “greener and smarter” portfolio and paves the way to entering the power business under a wholesale electricity market with an advanced trading system in the US. We preliminarily expect Temple I to generate immediate cash flow (starting in 2022E), implying upside risk of 8-10% to BANPU’s earnings and 6-7% to BPP’s earnings. We maintain a Hold rating on BANPU.

<p>BANPU’s 1H21 earnings showed stronger momentum YoY, with the coal business as the key growth catalyst, prompting us to maintain our full- year forecasts. Meanwhile, the company is transitioning to a “greener and smarter” portfolio, with the incremental contribution expected to ramp up over the next five years at the expense of an EPS dilution effect from the planned capital increase. We maintain a Hold rating.</p>

BANPU’s 1H21 earnings showed stronger momentum YoY, with the coal business as the key growth catalyst, prompting us to maintain our full- year forecasts. Meanwhile, the company is transitioning to a “greener and smarter” portfolio, with the incremental contribution expected to ramp up over the next five years at the expense of an EPS dilution effect from the planned capital increase. We maintain a Hold rating.

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

<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

Event-Driven

<p>The Stock Exchange of Thailand (SET) has commenced a market consultation on changing 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>, SET100 and SETHD indices to free float market cap weighted indices from the upcoming rebalance in June.</p><p>The market consultation document is short on detail, but the main points are the change in index calculation from full market cap weighted to free float market cap weighted, implementation of the changes in two tranches at the June and December reviews, and implementation of quarterly changes in free float for moves of +/-5%.</p><p>The biggest uncertainty for us is whether the selection of the stocks for inclusion/exclusion will use the full market cap or the free float market cap.</p><p>Using the full market cap for stock selection could see 3 changes at the upcoming June review, while using free float market cap for stock selection could result in up to 6 changes at the review. The two step implementation of the free float changes will dampen the index turnover but it will still be relatively high, ranging from a one-way turnover of 7.8% for changes in free float only to 9.52% if the stock selection methodology uses free float market cap.</p><p>In this Insight, we look at the proposed changes and enumerate three scenarios, the changes they will entail, the impact on the stocks and the turnover for each scenario.</p>

The Stock Exchange of Thailand (SET) has commenced a market consultation on changing the Stock Exchange of Thailand SET 50 Index (SET50 INDEX), SET100 and SETHD indices to free float market cap weighted indices from the upcoming rebalance in June.The market consultation document is short on detail, but the main points are the change in index calculation from full market cap weighted to free float market cap weighted, implementation of the changes in two tranches at the June and December reviews, and implementation of quarterly changes in free float for moves of +/-5%.The biggest uncertainty for us is whether the selection of the stocks for inclusion/exclusion will use the full market cap or the free float market cap.Using the full market cap for stock selection could see 3 changes at the upcoming June review, while using free float market cap for stock selection could result in up to 6 changes at the review. The two step implementation of the free float changes will dampen the index turnover but it will still be relatively high, ranging from a one-way turnover of 7.8% for changes in free float only to 9.52% if the stock selection methodology uses free float market cap.In this Insight, we look at the proposed changes and enumerate three scenarios, the changes they will entail, the impact on the stocks and the turnover for each scenario.

SET50 Index - Proposed Methodology Changes: Scenarios, Names Affected & Impact

CEO, A. Stotz Investment Research

Dr. Andrew Stotz, CFA

Quantamental Investing to beat Benchmarks

A. Stotz Investment Research

We pick stocks. We construct portfolios. All our effort is focused on how to better pick stocks and construct portfolios. We serve fund management companies, family offices, and high net worth individuals.

Thematic (Sector/Industry)

<p>We highlight 14 stocks in Thailand that look interesting to us based upon our FVMR Methodology. Our research team constantly reviews the Thai market to try to find interesting ideas base upon Fundamentals or Valuation or Momentum or Risk or some combination thereof.</p>

We highlight 14 stocks in Thailand that look interesting to us based upon our FVMR Methodology. Our research team constantly reviews the Thai market to try to find interesting ideas base upon Fundamentals or Valuation or Momentum or Risk or some combination thereof.

The Stocks to Own in Thailand – Vol. 32

Thailand

Banpu Public Company Limited mines for coal and other minerals. The Company produces thermal coal and coking coal, and have expertise in open-pit and underground coal mining operations, as well as coal-fired power generation.  Banpu PCL has business bases in Thailand, Laos, Indonesia, China, Australia and Mongolia.

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Banpu (BANPU-R TB)

Company Update: Banpu Plc. (BANPU)

The move to acquire the 768MW Temple I power plant in Texas is aligned with the BANPU Group’s growth transition to a “greener and smarter” portfolio

Krungthai XSpring

Earnings Review: Banpu Plc.

BANPU’s 1H21 earnings showed stronger momentum YoY, with the coal business as the key growth catalyst, prompting us to maintain our full- year...

Krungthai XSpring

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

SET50 Index - Proposed Methodology Changes: Scenarios, Names Affected & Impact

The SET has commenced a market consultation on the proposed changes to make its indices free float market cap weighted. We look at the impact on...

Brian Freitas

The Stocks to Own in Thailand – Vol. 32

A. Stotz Thai Portfolio: We highlight 14 stocks in Thailand that look interesting to us based upon our FVMR Methodology.

A. Stotz Investment Research

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