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.

Thematic (Sector/Industry)

<ul><li>Although the market is likely to revise down EPS estimates following weaker-than- expected 3Q24 earnings, using the KTX implied EPS tool, we find that most sectors (accounting for over 80% of total market capitalization) have partially priced in the negative factors, which limits the downside risk.</li><li>In addition, the SET Index's correction of -0.8% (since the 3Q24 earnings announcements) has kept the market risk premium (MRP) stable at 4.213%, matching the lower bound of the trading buy range at an MRP of 4.21% (-1 S.D.).</li><li>This suggests that the SET is at a level where the risk-reward appears attractive. </li></ul>

Although the market is likely to revise down EPS estimates following weaker-than- expected 3Q24 earnings, using the KTX implied EPS tool, we find that most sectors (accounting for over 80% of total market capitalization) have partially priced in the negative factors, which limits the downside risk.In addition, the SET Index's correction of -0.8% (since the 3Q24 earnings announcements) has kept the market risk premium (MRP) stable at 4.213%, matching the lower bound of the trading buy range at an MRP of 4.21% (-1 S.D.).This suggests that the SET is at a level where the risk-reward appears attractive. 

Special Report: Investment Strategy Post-3Q24 Earnings Reports - NOVEMBER 21, 2024

<ul><li>KTX holds a positive view of the new household debt relief measures, as they help reduce principal amounts and long-term debt burdens.</li><li>This is expected to have a favorable impact on asset quality and ease future provisioning pressures.</li><li>These measures are particularly beneficial for small and medium-sized banks with a high proportion of retail loan portfolios. Recommendations include KKP, TTB, and TISCO.</li></ul>

KTX holds a positive view of the new household debt relief measures, as they help reduce principal amounts and long-term debt burdens.This is expected to have a favorable impact on asset quality and ease future provisioning pressures.These measures are particularly beneficial for small and medium-sized banks with a high proportion of retail loan portfolios. Recommendations include KKP, TTB, and TISCO.

Banking - New Household Debt Relief Measure: A Positive Outlook for Small and Medium-Sized Banks

<ul><li>The latest Global Fund Manager Survey by Bank of America polled 179 global fund managers with a total NAV of USD503bn.</li><li>The survey, which took place between November 1-7, includes 22% of responses gathered after the US election results were announced — reflecting partial recognition of the outcome, with Trump being elected US president and the Republican Party likely to have control of both the House of Representatives and the Senate.</li><li>The survey reveals significant shifts in asset allocations in response to these developments. The shift is driven by the US economy showing stronger signs of a "no landing" scenario, while the global downward interest rate cycle appears less pronounced than previously expected. </li></ul>

The latest Global Fund Manager Survey by Bank of America polled 179 global fund managers with a total NAV of USD503bn.The survey, which took place between November 1-7, includes 22% of responses gathered after the US election results were announced — reflecting partial recognition of the outcome, with Trump being elected US president and the Republican Party likely to have control of both the House of Representatives and the Senate.The survey reveals significant shifts in asset allocations in response to these developments. The shift is driven by the US economy showing stronger signs of a "no landing" scenario, while the global downward interest rate cycle appears less pronounced than previously expected. 

FMS Outlook Following Trump's Victory as US President - November 19, 2024

<ul><li>The six banks under our coverage reported a combined net profit of Bt43.6bn in 3Q24, growing 8.6% YoY and 3.0% QoQ, which was 6% above our expectations.</li><li>This was due to: I) BBL’s better-than-expected non-interest income (NII) from mark-to-market investment gains, and ii) lower-than-expected provisions from SCB and KKP.</li><li>We maintain a Neutral rating on the banking sector, as the short-term growth drivers remain unclear. </li></ul>

The six banks under our coverage reported a combined net profit of Bt43.6bn in 3Q24, growing 8.6% YoY and 3.0% QoQ, which was 6% above our expectations.This was due to: I) BBL’s better-than-expected non-interest income (NII) from mark-to-market investment gains, and ii) lower-than-expected provisions from SCB and KKP.We maintain a Neutral rating on the banking sector, as the short-term growth drivers remain unclear. 

Banking Upbeat 3Q24 Earnings but a Lack of Short-Term Catalysts - OCTOBER 28, 2024

Equity Bottom-Up

<ul><li>We maintain a Neutral rating with a 12M FV of Bt150.00, based on the earnings yield method and a required return of 16.6%.</li><li>The valuation metrics indicate that the stock is fully valued in the short term, while the long-term performance is expected to grow at a moderate level, alongside the tactical risk remaining neutral</li><li>KBANK reported a net profit of Bt11.9bn for 3Q24, up 6% YoY but down 5% QoQ, in line with both our and the market expectations.</li></ul>

We maintain a Neutral rating with a 12M FV of Bt150.00, based on the earnings yield method and a required return of 16.6%.The valuation metrics indicate that the stock is fully valued in the short term, while the long-term performance is expected to grow at a moderate level, alongside the tactical risk remaining neutralKBANK reported a net profit of Bt11.9bn for 3Q24, up 6% YoY but down 5% QoQ, in line with both our and the market expectations.

Kasikornbank - In-Line 3Q24 Earnings; Balance Sheet Cleanup Expected to Be Completed in 2024E

Thailand

Kasikornbank Public Company Limited provides commercial banking services including personal and commercial banking, international trade, as well as investment banking services, to its customers throughout Thailand.  The Bank has foreign branches in Los Angeles, Hong Kong, Cayman Islands, and Shenzhen; and representative offices in Shanghai, Beijing, and Kunmin.

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Kasikornbank (KBANK/F TB)

Special Report: Investment Strategy Post-3Q24 Earnings Reports - NOVEMBER 21, 2024

Listed companies reported a combined net profit (SET EPS) of Bt208bn in 3Q24, which was approximately 8.5% below the consensus estimate.

Krungthai XSpring

Banking - New Household Debt Relief Measure: A Positive Outlook for Small and Medium-Sized Banks

KTX holds a positive view of the new household debt relief measures, as they help reduce principal amounts and long-term debt burdens.

Krungthai XSpring

FMS Outlook Following Trump's Victory as US President - November 19, 2024

The survey, which took place between November 1-7, includes 22% of responses gathered after the US election results were announced — reflecting...

Krungthai XSpring

Banking Upbeat 3Q24 Earnings but a Lack of Short-Term Catalysts - OCTOBER 28, 2024

The six banks under our coverage reported a combined net profit of Bt43.6bn in 3Q24, growing 8.6% YoY and 3.0% QoQ, which was 6% above our...

Krungthai XSpring

Kasikornbank - In-Line 3Q24 Earnings; Balance Sheet Cleanup Expected to Be Completed in 2024E

We maintain a Neutral rating with a 12M FV of Bt150.00, based on the earnings yield method and a required return of 16.6%.

Krungthai XSpring

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