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

Equity Bottom-Up

Somboon Advance Technology P / Equity Bottom-Up

Somboon Advance Technology PCL manufactures and sells automotive parts for sale to automobile manufacturers. The Company's products include axle shafts, leaf springs, disk and drum brakes, manifold exhaust, fly wheels, stabilizer bars, and coil springs.

<ul>
<li>We downgrade our rating to Neutral, as the valuation metrics indicate less attractiveness in terms of the valuation, with the stock price trading approximately 3.4% above the new fair value (FV).</li>
<li>The tactical outlook has also weakened compared to the previous report (from limited downside risk to neutral).</li>
<li>The 2025E FV has been revised down to Bt10.70 (previously Bt12.80) due to a reduction in the earnings forecasts by an average of approximately 7.3% to reflect the downbeat auto market.</li>
</ul>


We downgrade our rating to Neutral, as the valuation metrics indicate less attractiveness in terms of the valuation, with the stock price trading approximately 3.4% above the new fair value (FV).
The tactical outlook has also weakened compared to the previous report (from limited downside risk to neutral).
The 2025E FV has been revised down to Bt10.70 (previously Bt12.80) due to a reduction in the earnings forecasts by an average of approximately 7.3% to reflect the downbeat auto market.


Somboon Advance Technology - Recovery Signs Remain Weak

<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 3Q24 earnings performance of 686 stocks in the SET Index (accounting for 95% of total market capitalization) totaled Bt207,918mn, declining by 19% QoQ and 24% YoY.</li><li>However, excluding energy and petrochemical stocks, the remaining sectors showed stable performances QoQ and significant YoY growth.</li><li>For the 163 stocks covered by the Bloomberg consensus, net profit came in at Bt176,516mn, down 23% YoY and 22% QoQ, and about 8% below the Bloomberg consensus estimates. </li></ul>

The 3Q24 earnings performance of 686 stocks in the SET Index (accounting for 95% of total market capitalization) totaled Bt207,918mn, declining by 19% QoQ and 24% YoY.However, excluding energy and petrochemical stocks, the remaining sectors showed stable performances QoQ and significant YoY growth.For the 163 stocks covered by the Bloomberg consensus, net profit came in at Bt176,516mn, down 23% YoY and 22% QoQ, and about 8% below the Bloomberg consensus estimates. 

Special Report: 3Q24 Earnings Summary - November 20, 2024

Bangkok Dusit Medical Services / Equity Bottom-Up

Bangkok Dusit Medical Services Public Company Limited operates Bangkok General Hospital. The Hospital specializes in cardiovascular, lung, neurological, eye and genitourinary cancer, as well as physical therapy and medical imaging.

<ul><li>We downgrade our rating to Neutral (previously Outperform), with a more negative view on the fundamentals.</li><li>This is due to the expected 2024-26E EPS growth of just a +5% CAGR, weaker than the industry average of +7%.</li><li>On top of that, the stock price offers only 4% upside to the new fair value (FV).</li></ul>

We downgrade our rating to Neutral (previously Outperform), with a more negative view on the fundamentals.This is due to the expected 2024-26E EPS growth of just a +5% CAGR, weaker than the industry average of +7%.On top of that, the stock price offers only 4% upside to the new fair value (FV).

BDMS TB- Revised Down Earnings Forecasts to Reflect Weak Foreign Patient Numbers