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.

Cross Asset Strategy

<ul><li>Technically, the SET Index is expected to move up, with the resistance at 1,540 points (75-day EMA)/1,550 points and the support at 1,527/1,515 points (25-day/10-day EMA).</li><li>On a positive note, large banks are projected to report higher profits owing to improving NIM (as the interest rate uptrend has boosted loan yields), overall loan growth (thanks to recovering economic activities, like retail and corporate loans), and higher fair value through profit or loss (FVTPL), which should help offset increases in spending and ECL provision expenses.</li><li>On the political front, there is some positive news as more than half of the total seats in parliament have expressed the view that Khun Pita cannot be nominated as the prime minister candidate twice after failing in the first vote.</li></ul>

Technically, the SET Index is expected to move up, with the resistance at 1,540 points (75-day EMA)/1,550 points and the support at 1,527/1,515 points (25-day/10-day EMA).On a positive note, large banks are projected to report higher profits owing to improving NIM (as the interest rate uptrend has boosted loan yields), overall loan growth (thanks to recovering economic activities, like retail and corporate loans), and higher fair value through profit or loss (FVTPL), which should help offset increases in spending and ECL provision expenses.On the political front, there is some positive news as more than half of the total seats in parliament have expressed the view that Khun Pita cannot be nominated as the prime minister candidate twice after failing in the first vote.

Waiting for Thai and US Corporate Earnings

<ul><li>Technically, the SET Index is expected to gain, with the resistance at 1,540 points (75-day EMA) /1,550 points and the support at 1,527/1,513 points (25-day/10-day EMA).</li><li>There are two key issues today. First, the highlight will be the second vote on the prime minister.</li><li>In addition to political issues, banks' earnings will be another key concern.</li></ul>

Technically, the SET Index is expected to gain, with the resistance at 1,540 points (75-day EMA) /1,550 points and the support at 1,527/1,513 points (25-day/10-day EMA).There are two key issues today. First, the highlight will be the second vote on the prime minister.In addition to political issues, banks' earnings will be another key concern.

<ul><li>Technically, the SET Index is expected to increase, with the resistance at 1,527/1,540 points (50/75-day EMA) and the support at 1,505/1,500 points (10-day EMA), after the considerable advance last Friday.</li><li>Today's highlight is the market risk premium of the SET Index having entered the buy zone in the range of O S.D. to +2 S.D. (MRP at 4.16% to 4.47%) after it fell to -2 S.D. (MRP at 3.84%) because of the downward revision to EPS by 5% in 1H23.</li><li>Meanwhile, earnings performances in 2Q23E are likely to have improved both QoQ and YoY based on the Bloomberg consensus (as of July 13, 2023), which accounts for 70% of the SET's market capitalization.</li></ul>

Technically, the SET Index is expected to increase, with the resistance at 1,527/1,540 points (50/75-day EMA) and the support at 1,505/1,500 points (10-day EMA), after the considerable advance last Friday.Today's highlight is the market risk premium of the SET Index having entered the buy zone in the range of O S.D. to +2 S.D. (MRP at 4.16% to 4.47%) after it fell to -2 S.D. (MRP at 3.84%) because of the downward revision to EPS by 5% in 1H23.Meanwhile, earnings performances in 2Q23E are likely to have improved both QoQ and YoY based on the Bloomberg consensus (as of July 13, 2023), which accounts for 70% of the SET's market capitalization.

Macroeconomics

<ul><li>After the release of the unofficial results of the general election on May 14, our base- case scenario seems to be the most likely, with the new government to consist of at least three parties holding around 300 seats.</li><li>The key risk is that if the coalition has fewer than 376 seats, the candidate for prime minister will need support from some senators.</li><li>We still expect the SET Index to move up to 1,607 points.</li></ul>

After the release of the unofficial results of the general election on May 14, our base- case scenario seems to be the most likely, with the new government to consist of at least three parties holding around 300 seats.The key risk is that if the coalition has fewer than 376 seats, the candidate for prime minister will need support from some senators.We still expect the SET Index to move up to 1,607 points.

Election Rally: Support from Senators May Be Needed

Thematic (Sector/Industry)

<ul><li>Greater clarity after the general election should ease worries over a possible coup and a delay in the formation of a coalition government, which we expect to consist of three parties, i.e., the Pheu Thai Party, the Palang Pracharath Party and the Bhumjaithai Party, in our base-case scenario; this would reduce the risk premium of the SET Index, pushing it up to our target of 1,607 points.</li><li>Historical data from the five most recent elections shows that the SET increased by an average of +3.47% in the month after they were held; and in the week before and after the general elections took place, the index rose by 1.87% and 3.81%, respectively.</li><li>The biggest gainers were the finance, property development and ICT sectors. We thus recommend speculating on SIRI, SC, SCB, KBANK, CPALL, INTUCH, ADVANC and MINT.</li></ul>

Greater clarity after the general election should ease worries over a possible coup and a delay in the formation of a coalition government, which we expect to consist of three parties, i.e., the Pheu Thai Party, the Palang Pracharath Party and the Bhumjaithai Party, in our base-case scenario; this would reduce the risk premium of the SET Index, pushing it up to our target of 1,607 points.Historical data from the five most recent elections shows that the SET increased by an average of +3.47% in the month after they were held; and in the week before and after the general elections took place, the index rose by 1.87% and 3.81%, respectively.The biggest gainers were the finance, property development and ICT sectors. We thus recommend speculating on SIRI, SC, SCB, KBANK, CPALL, INTUCH, ADVANC and MINT.

Special Report: Election Rally (History to Repeat Itself)

Thailand

Intouch Holdings Public Company Limited is a Thailand-based investment holding company primarily engaged in the telecommunications, media, and technology (TMT) sectors, with a focus on digital businesses. The company primarily generates revenue through its stakes in subsidiaries and associates, most notably Advanced Info Service (AIS), Thailand's largest mobile operator. It was established in 1983 and is headquartered in Bangkok, Thailand.

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Intouch Holdings (INTUCH TB)

Waiting for Thai and US Corporate Earnings

Technically, the SET Index is expected to move up, with the resistance at 1,540 points (75-day EMA)/1,550 points and the support at 1,527/1,515...

Krungthai XSpring

Today's Dominant Ideas

Technically, the SET Index is expected to gain, with the resistance at 1,540 points (75-day EMA) /1,550 points and the support at 1,527/1,513...

Krungthai XSpring

Today's Dominant Ideas

Technically, the SET Index is expected to increase, with the resistance at 1,527/1,540 points (50/75-day EMA) and the support at 1,505/1,500...

Krungthai XSpring

Election Rally: Support from Senators May Be Needed

After the release of the unofficial results of the general election on May 14, our base- case scenario seems to be the most likely, with the new...

Krungthai XSpring

Special Report: Election Rally (History to Repeat Itself)

The biggest gainers were the finance, property development and ICT sectors. We thus recommend speculating on SIRI, SC, SCB, KBANK, CPALL, INTUCH,...

Krungthai XSpring

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