Asean-focused. Ex-Head of Thai Research

Athaporn Arayasantiparb, CFA

Equity Bottom-Up

<p>We met up with BTS management today and saw that things are clearly picking up in virtually all aspects of the business. Some key points we noted were:</p><table class="table table-striped"><tbody>
<tr>
<td>Stocks</td>
<td style="text-align: center;">Business</td>
<td style="text-align: center;">Shr pr (Bt/sh)</td>
<td style="text-align: center;">Mkt cap (US$ m)</td>
<td style="text-align: center;">PE (x)</td>
<td style="text-align: center;">Yld (%)</td>
</tr>
<tr>
<td>BTS</td>
<td style="text-align: center;">Skytrain</td>
<td style="text-align: center;">8.6</td>
<td style="text-align: center;">2,900</td>
<td style="text-align: center;">58.6</td>
<td style="text-align: center;">7.9</td>
</tr>
<tr>
<td>MACO</td>
<td style="text-align: center;">Transit media</td>
<td style="text-align: center;">1.09</td>
<td style="text-align: center;">100</td>
<td style="text-align: center;">22.9</td>
<td style="text-align: center;">3.3</td>
</tr>
</tbody></table><ul><li>
<strong>Strong 33% growth in media revenues </strong>following the acquisition of MACO or Master Ad. Right now, you will notice that media accounts for an even bigger portion of revenues than transport, which was not the case in the last quarter. In…</li></ul>

We met up with BTS management today and saw that things are clearly picking up in virtually all aspects of the business. Some key points we noted were:

Stocks
Business
Shr pr (Bt/sh)
Mkt cap (US$ m)
PE (x)
Yld (%)


BTS
Skytrain
8.6
2,900
58.6
7.9


MACO
Transit media
1.09
100
22.9
3.3


Strong 33% growth in media revenues following the acquisition of MACO or Master Ad. Right now, you will notice that media accounts for an even bigger portion of revenues than transport, which was not the case in the last quarter. In…

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>His Majesty King Bhumibol Adulyadej (Rama IX) passed away at Siriraj Hospital in Bangkok yesterday, 13 October 2016, at 3.52pm. Our condolences to all our Thai friends in your time of grief.</p><p>Thailand is sailing into unchartered waters, considering that nearly everyone alive has only known one King and that his fiat power was immense, built up over years of devotion to the country.</p><p>We expect that the Thai stock market will be hurt in the near term, but will eventually stabilize.</p>

His Majesty King Bhumibol Adulyadej (Rama IX) passed away at Siriraj Hospital in Bangkok yesterday, 13 October 2016, at 3.52pm. Our condolences to all our Thai friends in your time of grief.Thailand is sailing into unchartered waters, considering that nearly everyone alive has only known one King and that his fiat power was immense, built up over years of devotion to the country.We expect that the Thai stock market will be hurt in the near term, but will eventually stabilize.

Thailand Mourns Fallen King, Healing Will Take Some Time

<ul><li>Strong stock price momentum, relatively strong analyst recommendation, and strong sales momentum relative to its sector</li><li>Given CK’s strong competitive position and solid track record, it is in a prime position to win the bidding on the government’s MRT Orange Line subway project valued at Bt140bn out of upcoming government tender calls valued at Bt300bn</li><li>CK bagged four new projects in 1H16, with its current backlog of Bt79bn adequate to create revenues for two years</li><li>The stock trades above ASEAN Capital Goods but CK has shown good efficiency gains in asset turnover</li><li>Risks: Delayed auctions from government, construction delays</li></ul><p><em>* Consensus Estimates</em></p>

Strong stock price momentum, relatively strong analyst recommendation, and strong sales momentum relative to its sectorGiven CK’s strong competitive position and solid track record, it is in a prime position to win the bidding on the government’s MRT Orange Line subway project valued at Bt140bn out of upcoming government tender calls valued at Bt300bnCK bagged four new projects in 1H16, with its current backlog of Bt79bn adequate to create revenues for two yearsThe stock trades above ASEAN Capital Goods but CK has shown good efficiency gains in asset turnoverRisks: Delayed auctions from government, construction delays* Consensus Estimates

CK: Large-Scale Builder Enjoys Efficiency Gains

Founder, Riedel Research

David Riedel

Founder

Independent equity research on GEM Markets

Riedel Research

Riedel provides equity research and analysis to leading financial organizations. By becoming members of a region (Asia, Latin America, Emerging Europe or Global), organizations have access to an integrated set of services including:

Regular company coverage reports
Up-to-date investment decision advice (buy, hold, sell)
Monthly regional and global conference calls
Customized company reports and unlimited on-line access to the program's services.

Riedel provides research coverage of companies across the full range of market capitalization. Experienced research professionals in each market develop company reports and analysis as well as earnings models and projections. Ratings are Buy, Hold and Sell with a focus on compelling investment ideas - both long and short. Downloadable, dynamic earnings models are built to facilitate sensitivity analysis.

Please feel free to contact us for complimentary access to our written research.  We want to show you that our unique research flow can add value and help develop a long-term, high value-add relationship.

Riedel's model focuses on providing clients with unique insights and consulting in addition to unlimited access to all produced research This model allows members to receive exponential benefits for their retainer fees.

<ul>
<li>Obama continues the 'pivot to Asia' by attending the ASEAN meeting in Laos.</li>
<li>ASEAN is a critical component of SE Asian stability, partnership with the US and should be a united front in protesting Chinese intrusions into the South China Sea.</li>
<li>A high-profile spat with Philippine president Duterte was an unfortunate distraction and an unhelpful development for the Philippines which benefits from strong U.S. support.</li>
<li>Thailand and Malaysia look like the best opportunities in ASEAN in the medium-term.</li>
<li>BUY…</li>
</ul>


Obama continues the 'pivot to Asia' by attending the ASEAN meeting in Laos.
ASEAN is a critical component of SE Asian stability, partnership with the US and should be a united front in protesting Chinese intrusions into the South China Sea.
A high-profile spat with Philippine president Duterte was an unfortunate distraction and an unhelpful development for the Philippines which benefits from strong U.S. support.
Thailand and Malaysia look like the best opportunities in ASEAN in the medium-term.
BUY…


Takeaways from ASEAN - Investment Opportunities

Sino-Thai Engineering & Construction / Equity Bottom-Up

<p>STEC and CK trade in line with each other even after detailed breakdown to the price-to-backlog level (0.7x). We prefer both companies to market leader ITD, which seems unable to make a profit. If we are forced to choose between the two contractors, we will pick STEC simply because it is more professional and focused. We think there is 14% upside for STEC based on Bt30.3/sh price target, making STEC  a good candidate to replace AIS as one of our top picks.</p><p>On an absolute basis, we actually own BJCHI, which trades under 7x PE and has a high yield of almost 8%. We think BJCHI's valuation is depressed because it does a lot of work for Petrobras, but there seems to be no defaults in Brazil at all.</p>

STEC and CK trade in line with each other even after detailed breakdown to the price-to-backlog level (0.7x). We prefer both companies to market leader ITD, which seems unable to make a profit. If we are forced to choose between the two contractors, we will pick STEC simply because it is more professional and focused. We think there is 14% upside for STEC based on Bt30.3/sh price target, making STEC  a good candidate to replace AIS as one of our top picks.On an absolute basis, we actually own BJCHI, which trades under 7x PE and has a high yield of almost 8%. We think BJCHI's valuation is depressed because it does a lot of work for Petrobras, but there seems to be no defaults in Brazil at all.

CK Vs STEC: The Da Vinci Code for Thai Contractors

Thailand

Ch. Karnchang Public Company Limited provides construction services to public and private sectors including construction of expressways, public utilities, and industrial plants. Through it subsidiaries, the Company distributes construction materials.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Ch. Karnchang Public (CK TB)

BTS: All Engines Firing

We met up with BTS management today and saw that things are clearly picking up in virtually all aspects of the business. Some key points we noted...

Athaporn Arayasantiparb, CFA

Thailand Mourns Fallen King, Healing Will Take Some Time

His Majesty King Bhumibol Adulyadej (Rama IX) passed away at Siriraj Hospital in Bangkok yesterday, 13 October 2016, at 3.52pm. Our condolences to...

A. Stotz Investment Research

CK: Large-Scale Builder Enjoys Efficiency Gains

Strong stock price momentum, relatively strong analyst recommendation, and strong sales momentum relative to its sector Given CK’s strong...

A. Stotz Investment Research

Takeaways from ASEAN - Investment Opportunities

Obama continues the 'pivot to Asia' by attending the ASEAN meeting in Laos. ASEAN is a critical component of SE Asian stability, partnership with...

David Riedel

CK Vs STEC: The Da Vinci Code for Thai Contractors

STEC and CK trade in line with each other even after detailed breakdown to the price-to-backlog level (0.7x). We prefer both companies to market...

Athaporn Arayasantiparb, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)