Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener"><strong>Intouch Holdings (INTUCH TB)</strong></a>'s discount to NAV is back to levels last seen in November 2021, where euphoric trading was rolling over subsequent to <strong><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 (GULF TB)</a></strong>'s VTO.</li>
<li>Intouch's net cash increased in the 2Q22 and its look-through interim dividend payout is the highest in at least five years.</li>
<li>I'd be shorting Intouch here and buying <strong><a href="https://www.smartkarma.com/entities/advanced-info-service-pcl" target="_blank" data-smartkarma-citation="entities:947:1" rel="noopener">Advanced Info Service (ADVANC TB)</a></strong>, with a view to mean reversion of ~25% NAV discount. </li>
</ul>



Intouch Holdings (INTUCH TB)'s discount to NAV is back to levels last seen in November 2021, where euphoric trading was rolling over subsequent to Gulf Energy Development (GULF TB)'s VTO.
Intouch's net cash increased in the 2Q22 and its look-through interim dividend payout is the highest in at least five years.
I'd be shorting Intouch here and buying Advanced Info Service (ADVANC TB), with a view to mean reversion of ~25% NAV discount. 


Intouch's NAV Discount Not Supported By Higher Look-Through Payout

Thai Equity - Bottom-up - Equities, Pi Securities PCL, Thailand

Pi Research

Thai Equity - Bottom-up - Equities

Leading, full-service investment firm in Thailand

Pi Securities PCL, Thailand

Pi Securities is a well known securities company with 40 years experience in the industry, serving more than 60,000 clients. We offer one - stop service providing full range of financial products and services including extensive Brokerage, Proprietary Trading (Equities and Bonds), Advisory Services, Structured Products.

Moreover, our new research team tailored for institutional clients to focus on mid to small cap of Thai equities and trading strategies. Our services offered to our premium clients also include arrangement of company or site visits to with the managements of Thai listed companies.

Note: Effective on 1 March 2022, Country Group Securities PCL changed its name to Pi Securities

Equity Bottom-Up

Gulf Energy Development  / Equity Bottom-Up

<ul>
<li>Maintain BUY recommendation for GULF with a target price of Bt58. Excluding FX and other extraordinary items, its 2Q22 core earnings stood at Bt3.1bn (+120% YoY, -5% QoQ)</li>
<li>Earnings for 2Q22 fell due to FX losses GULF posted their 2Q22 net profit of Bt1.5bn (+9%YoY, -55%QoQ).The QoQ drop in the net profit was dragged by an FX loss</li>
<li>Excluding FX and other extraordinary items the recurring profit was at Bt3.1bn (+120% YoY, -5% QoQ).The QoQ drop was pressured by a -2.8 ppts GPM drop due to an increase </li>
</ul>


Maintain BUY recommendation for GULF with a target price of Bt58. Excluding FX and other extraordinary items, its 2Q22 core earnings stood at Bt3.1bn (+120% YoY, -5% QoQ)
Earnings for 2Q22 fell due to FX losses GULF posted their 2Q22 net profit of Bt1.5bn (+9%YoY, -55%QoQ).The QoQ drop in the net profit was dragged by an FX loss
Excluding FX and other extraordinary items the recurring profit was at Bt3.1bn (+120% YoY, -5% QoQ).The QoQ drop was pressured by a -2.8 ppts GPM drop due to an increase 


GULF : Weak Earnings in 2Q22 Due to FX Losses

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>We suggest selling JMART after we recommended buying it yesterday because the stock has fallen out of our top rankings (with the return at +0.51%).</li><li>However, long-term investors may continue holding it, with the loss-stopping point at Bt48.00.</li><li>We add KKP to the portfolio, as the stock is likely to offer a YoY increase in the dividend payment for its1H22performance, which will be made in September, after it reported 1H22 earnings of Bt4,089mn, +45.1% YoY.</li></ul>

We suggest selling JMART after we recommended buying it yesterday because the stock has fallen out of our top rankings (with the return at +0.51%).However, long-term investors may continue holding it, with the loss-stopping point at Bt48.00.We add KKP to the portfolio, as the stock is likely to offer a YoY increase in the dividend payment for its1H22performance, which will be made in September, after it reported 1H22 earnings of Bt4,089mn, +45.1% YoY.

<ul><li>We recommend selling EA (with the return since it was first added at +0.9%, as the stock has fallen out of our top rankings.</li><li>We add JMART to the portfolio thanks to the expected 2Q22E earnings growth of 24.6% QoQ and 74.4% YoY to Bt405mn; this should have come on the back of the growth in the firms under its umbrella, led by JMT (the consensus estimates 2Q22E net profit at Bt392mn, +6.8% QoQ and +35.7% YoY) due to the seasonal increase in bad debt purchases and lower finance costs following the repayment of debentures, as well as SINGER (the consensus earnings estimate for 2Q22E is Bt246mn, +14.2% QoQ and +34.7% YoY) owing to the peak season for the sales of air conditioners.</li><li><div><div><div><div><p>GULF is a holding company engaging in core businesses relating to the generation and distribution of power based on natural gas and alternative energy. The firm also invests in infrastructure and other related businesses.</p></div></div></div></div></li></ul>

We recommend selling EA (with the return since it was first added at +0.9%, as the stock has fallen out of our top rankings.We add JMART to the portfolio thanks to the expected 2Q22E earnings growth of 24.6% QoQ and 74.4% YoY to Bt405mn; this should have come on the back of the growth in the firms under its umbrella, led by JMT (the consensus estimates 2Q22E net profit at Bt392mn, +6.8% QoQ and +35.7% YoY) due to the seasonal increase in bad debt purchases and lower finance costs following the repayment of debentures, as well as SINGER (the consensus earnings estimate for 2Q22E is Bt246mn, +14.2% QoQ and +34.7% YoY) owing to the peak season for the sales of air conditioners.GULF is a holding company engaging in core businesses relating to the generation and distribution of power based on natural gas and alternative energy. The firm also invests in infrastructure and other related businesses.

<ul><li>We suggest selling MEGA (with there turn since it was first added at-0.50%), as the stock has fallen out of our top rankings.</li><li>Yesterday, our Big Cap portfolio generated a return of -0.03%, vs. the SET Index’s return of +0.25%, due to profit taking on stocks whose prices gained the day before, such as BDMS (-1.80%), MAJOR (-1.45%), BH (-0.81%), and MINT (-0.74%).</li><li><div><div><p>GULF is a holding company engaging in core businesses relating to the generation and distribution of power based on natural gas and alternative energy. The firm also invests in infrastructure and other related businesses.</p></div></div></li></ul>

We suggest selling MEGA (with there turn since it was first added at-0.50%), as the stock has fallen out of our top rankings.Yesterday, our Big Cap portfolio generated a return of -0.03%, vs. the SET Index’s return of +0.25%, due to profit taking on stocks whose prices gained the day before, such as BDMS (-1.80%), MAJOR (-1.45%), BH (-0.81%), and MINT (-0.74%).GULF is a holding company engaging in core businesses relating to the generation and distribution of power based on natural gas and alternative energy. The firm also invests in infrastructure and other related businesses.

Thailand

Gulf Energy Development Public Company Limited produces and sells electricity and steam. The Company manages a portfolio of gas-fired and renewable power projects, as well as supplies steam and chilled water. Gulf Energy Development serves customers in Thailand.

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Gulf Energy Development (GULF TB)

Intouch's NAV Discount Not Supported By Higher Look-Through Payout

I'd be shorting Intouch here and buying AIS. I think a more reasonable discount to NAV is >20%. Gulf's holding remains problematic though, and...

David Blennerhassett

GULF : Weak Earnings in 2Q22 Due to FX Losses

Maintain BUY recommendation for GULF with a target price of Bt58. Excluding FX and other extraordinary items, its 2Q22 core earnings stood at...

Pi Securities PCL, Thailand

Big Cap Tactical Picks - August 9, 2022

We suggest selling JMART after we recommended buying it yesterday because the stock has fallen out of our top rankings (with the return at +0.51%).

Krungthai XSpring

Big Cap Tactical Picks - August 8, 2022

We recommend selling EA (with the return since it was first added at +0.9%, as the stock has fallen out of our top rankings.

Krungthai XSpring

Big Cap Tactical Picks - August 5, 2022

We suggest selling MEGA (with there turn since it was first added at-0.50%), as the stock has fallen out of our top rankings.

Krungthai XSpring

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