Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

Delta Electronics Thailand  / Event-Driven

Last evening post market close, the Stock Exchange of Thailand (SET) announced the results of the semi-annual review of the SET50 index with the changes taking effect after the close of trading on 30 December.<a href="https://www.smartkarma.com/entities/bangkok-commercial-asset-management-public-company-limited" target="_blank" data-smartkarma-citation="entities:28442:1" rel="noopener">Bangkok Commercial Asset Management (BAM TB)</a>, <a href="https://www.smartkarma.com/entities/com7-pcl" target="_blank" data-smartkarma-citation="entities:27411:1" rel="noopener">Com7 PCL (COM7 TB)</a> and <a href="https://www.smartkarma.com/entities/delta-electronics-thai-pcl" target="_blank" data-smartkarma-citation="entities:20912:1" rel="noopener">Delta Electronics Thai (DELTA TB)</a> have been included in the index, replacing <a href="https://www.smartkarma.com/entities/banpu-power-pcl" target="_blank" data-smartkarma-citation="entities:23631:1" rel="noopener">Banpu Power PCL (BPP TB)</a>, <a href="https://www.smartkarma.com/entities/irpc-pcl" target="_blank" data-smartkarma-citation="entities:19051:1" rel="noopener">IRPC PCL (IRPC TB)</a> and <a href="https://www.smartkarma.com/entities/wha-corp-pcl" target="_blank" data-smartkarma-citation="entities:104:1" rel="noopener">WHA Corp Pcl (WHA TB)</a>. This was our base case scenario, though DELTA had the lowest probability of index inclusion.Terrible timing! <a href="https://www.smartkarma.com/entities/delta-electronics-thai-pcl" target="_blank" data-smartkarma-citation="entities:20912:1" rel="noopener">Delta Electronics Thai (DELTA TB)</a> has gained 543.72% since it was deleted from the SET50 index at the June review, while <a href="https://www.smartkarma.com/entities/banpu-power-pcl" target="_blank" data-smartkarma-citation="entities:23631:1" rel="noopener">Banpu Power PCL (BPP TB)</a> has gained just 2.99% since it was included in the index at the June review. Not implementing this change in June would have led to the SET50 index return being over 3.5% higher than its actual return.One-way turnover for the rebalance is 4.92%. The impact of the changes does not appear like a lot, but the active funds trading ahead of implementation date could cause the stocks to move around a lot compared to their peers.This Insight is labelled Bullish as we expect DELTA to outperform its peers post the inclusion in the SET50 index. The stock could move lower post implementation date due to its higher valuations.

Last evening post market close, the Stock Exchange of Thailand (SET) announced the results of the semi-annual review of the SET50 index with the changes taking effect after the close of trading on 30 December.Bangkok Commercial Asset Management (BAM TB), Com7 PCL (COM7 TB) and Delta Electronics Thai (DELTA TB) have been included in the index, replacing Banpu Power PCL (BPP TB), IRPC PCL (IRPC TB) and WHA Corp Pcl (WHA TB). This was our base case scenario, though DELTA had the lowest probability of index inclusion.Terrible timing! Delta Electronics Thai (DELTA TB) has gained 543.72% since it was deleted from the SET50 index at the June review, while Banpu Power PCL (BPP TB) has gained just 2.99% since it was included in the index at the June review. Not implementing this change in June would have led to the SET50 index return being over 3.5% higher than its actual return.One-way turnover for the rebalance is 4.92%. The impact of the changes does not appear like a lot, but the active funds trading ahead of implementation date could cause the stocks to move around a lot compared to their peers.This Insight is labelled Bullish as we expect DELTA to outperform its peers post the inclusion in the SET50 index. The stock could move lower post implementation date due to its higher valuations.

<a href="https://www.smartkarma.com/entities/scg-packaging-public-company-limited" target="_blank" data-smartkarma-citation="entities:28684:1" rel="noopener">SCG Packaging (SCGP TB)</a> listed today on the Stock Exchange of Thailand (SET). No big bang opening day for the stock as it opened at the highs and quickly sold off to trade a tick or two above its IPO price of THB 35/share for most of the day.<a href="https://www.smartkarma.com/entities/scg-packaging-public-company-limited" target="_blank" data-smartkarma-citation="entities:28684:1" rel="noopener">SCG Packaging (SCGP TB)</a> traded 329.77m shares on the day at a VWAP of THB 35.9505. Bulk of the volume traded in the opening auction at THB 37.At the close of trading, SCGP traded at THB 35/share, probably supported by the greenshoe. That gave <a href="https://www.smartkarma.com/entities/scg-packaging-public-company-limited" target="_blank" data-smartkarma-citation="entities:28684:1" rel="noopener">SCG Packaging (SCGP TB)</a> a full market cap of THB 148.874bn placing it at rank 20 among the SET50 constituents and ensuring its market cap was more than 1% of the market cap of the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-index" target="_blank" data-smartkarma-citation="entities:22915:1" rel="noopener">Thailand SET Index (SET INDEX)</a> - 1.16% from our calculations. With a free float of 29.51%, the stock met all conditions for Fast Entry into the index.SET has just <a href="https://www.set.or.th/th/market/files/constituents/SET50_100_H2_2020_revised.pdf" target="_blank" rel="noopener">announced</a> the changes to the SET50 Index where <a href="https://www.smartkarma.com/entities/scg-packaging-public-company-limited" target="_blank" data-smartkarma-citation="entities:28684:1" rel="noopener">SCG Packaging (SCGP TB)</a> has been added and <a href="https://www.smartkarma.com/entities/thanachart-capital-pcl" target="_blank" data-smartkarma-citation="entities:297:1" rel="noopener">Thanachart Capital (TCAP TB)</a> has been deleted. The changes will need to be made at the close of trading on 27 October.The inclusion also affects the stocks to be included and excluded at the regular index review in December.

SCG Packaging (SCGP TB) listed today on the Stock Exchange of Thailand (SET). No big bang opening day for the stock as it opened at the highs and quickly sold off to trade a tick or two above its IPO price of THB 35/share for most of the day.SCG Packaging (SCGP TB) traded 329.77m shares on the day at a VWAP of THB 35.9505. Bulk of the volume traded in the opening auction at THB 37.At the close of trading, SCGP traded at THB 35/share, probably supported by the greenshoe. That gave SCG Packaging (SCGP TB) a full market cap of THB 148.874bn placing it at rank 20 among the SET50 constituents and ensuring its market cap was more than 1% of the market cap of the Thailand SET Index (SET INDEX) - 1.16% from our calculations. With a free float of 29.51%, the stock met all conditions for Fast Entry into the index.SET has just announced the changes to the SET50 Index where SCG Packaging (SCGP TB) has been added and Thanachart Capital (TCAP TB) has been deleted. The changes will need to be made at the close of trading on 27 October.The inclusion also affects the stocks to be included and excluded at the regular index review in December.

<a href="https://www.smartkarma.com/entities/scg-packaging-public-company-limited" target="_blank" data-smartkarma-citation="entities:28684:1" rel="noopener">SCG Packaging (SCGP TB)</a>, Thailand's largest packaging company, is looking to raise between THB 37.77-39.46bn (US$1.21-1.26bn) via a listing on the Stock Exchange of Thailand (SET) by selling 1.127bn shares (plus a greenshoe of 169m shares) at a price range of THB 33.5-35/share.Shares will be offered to investors between 28 September and 14 October with final pricing to be announced on 8 October and shares should begin trading in the second half of October.Using current market prices, the stock should be included in the SET50 index at the close on its third day of trading, but the final decision is dependent on <a href="https://www.smartkarma.com/entities/scg-packaging-public-company-limited" target="_blank" data-smartkarma-citation="entities:28684:1" rel="noopener">SCG Packaging (SCGP TB)</a>'s closing price on its first trading day and also on the performance of the current constituents of the SET50 index and the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-index" target="_blank" data-smartkarma-citation="entities:22915:1" rel="noopener">Thailand SET Index (SET INDEX)</a>.In this Insight, we take a look at the some of the IPO details and the possibility of the stock being included in the SET50 index.

SCG Packaging (SCGP TB), Thailand's largest packaging company, is looking to raise between THB 37.77-39.46bn (US$1.21-1.26bn) via a listing on the Stock Exchange of Thailand (SET) by selling 1.127bn shares (plus a greenshoe of 169m shares) at a price range of THB 33.5-35/share.Shares will be offered to investors between 28 September and 14 October with final pricing to be announced on 8 October and shares should begin trading in the second half of October.Using current market prices, the stock should be included in the SET50 index at the close on its third day of trading, but the final decision is dependent on SCG Packaging (SCGP TB)'s closing price on its first trading day and also on the performance of the current constituents of the SET50 index and the Thailand SET Index (SET INDEX).In this Insight, we take a look at the some of the IPO details and the possibility of the stock being included in the SET50 index.

SCG Packaging and SET50 Fast Entry Inclusion: In The Box

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

Star Petroleum Refining / Equity Bottom-Up

We revise down company’s earning to the loss of Bt956m in 2020E and also trim our target price by 50% to Bt5.7 (from Bt11.6), derived from 0.8xPBV’20E which is -2SD to its 5 year average. We maintain a ‘BUY’ recommendation as we believe current valuation is quite cheap.The story:<div>• Revise earnings down as refinery margin collapse</div><div>• Petroleum consumption remain weak in 2Q20E</div><div>• Strong balance sheet, compared to peers</div>

We revise down company’s earning to the loss of Bt956m in 2020E and also trim our target price by 50% to Bt5.7 (from Bt11.6), derived from 0.8xPBV’20E which is -2SD to its 5 year average. We maintain a ‘BUY’ recommendation as we believe current valuation is quite cheap.The story:• Revise earnings down as refinery margin collapse• Petroleum consumption remain weak in 2Q20E• Strong balance sheet, compared to peers

Yesterday analysts meeting came out with a positive tone. We maintain our BUY rating and a target price of Bt33 based on SOTP, implying to 1xPBV’20E.Key takeaway:<ul>
<li>Expect 4Q19 earnings to grow YoY and QoQ backed by a recovery in refinery business.</li>
<li>Trimmed 2019E earnings forecast by 33% to factor in higher stock loss than expectation.</li>
<li>We forecast 2020E earnings to grow 87%YoY and maintain our positive view toward its 2019-2021 earnings backed by better demand outlook derived from IMO regulation applied in Jan 2020 and 17% capacity expansion by 2021.</li>
</ul>Upside risk: An IPO of Saudi Aramco in December might have positive sentiment toward crude price which could have low pressure to its stock loss.Background: Established in 1940, Bangchak Corporation Public Company Limited and its subsidiaries ‘ operations include refinery, oil trading, petroleum product marketing and renewable energy businesses. With a capacity of 120,000 barrels per day, Bangchak produces and distributes its products through more than 1,000 service stations nationwide. It also plans to expand the scope of its business to cover food and convenience stores and novel product businesses and to seek investment opportunities in bio-based products and natural resource businesses.

Yesterday analysts meeting came out with a positive tone. We maintain our BUY rating and a target price of Bt33 based on SOTP, implying to 1xPBV’20E.Key takeaway:
Expect 4Q19 earnings to grow YoY and QoQ backed by a recovery in refinery business.
Trimmed 2019E earnings forecast by 33% to factor in higher stock loss than expectation.
We forecast 2020E earnings to grow 87%YoY and maintain our positive view toward its 2019-2021 earnings backed by better demand outlook derived from IMO regulation applied in Jan 2020 and 17% capacity expansion by 2021.
Upside risk: An IPO of Saudi Aramco in December might have positive sentiment toward crude price which could have low pressure to its stock loss.Background: Established in 1940, Bangchak Corporation Public Company Limited and its subsidiaries ‘ operations include refinery, oil trading, petroleum product marketing and renewable energy businesses. With a capacity of 120,000 barrels per day, Bangchak produces and distributes its products through more than 1,000 service stations nationwide. It also plans to expand the scope of its business to cover food and convenience stores and novel product businesses and to seek investment opportunities in bio-based products and natural resource businesses.

BCP: Better Refinery Outlook in 4Q19 and Beyond

Thailand

IRPC PCL produces a variety of petrochemical products including polypropylene, high density polyethylene and expandable polystyrene primarily used in packaging materials. Through its subsidiaries, the Company produces and distributes gasoline, liquefied petroleumgas (LPG), asphalt, as well as electricity and construction materials.

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IRPC PCL (IRPC TB)

SET50 Index Rebalance: DELTA to Buy

BAM, COM7 and DELTA have been added to the SET50 index replacing BPP, IRPC and WHA with the changes effective after the close on 30 Dec. With 11...

Brian Freitas

SCG Packaging Listing & SET50 Inclusion

SCG Packaging listed on the SET today and finished flat on the day. That was enough to warrant inclusion in the SET50 index. TCAP will be deleted...

Brian Freitas

SCG Packaging and SET50 Fast Entry Inclusion: In The Box

SCG Packaging (SCGP TB)

Brian Freitas

SPRC: A Harsh Year for Refineries

We revise down company’s earning to the loss of Bt956m in 2020E and also trim our target price by 50% to Bt5.7 (from Bt11.6), derived from...

Pi Securities PCL, Thailand

BCP: Better Refinery Outlook in 4Q19 and Beyond

Yesterday analysts meeting came out with a positive tone. We maintain our BUY rating and a target price of Bt33 based on SOTP, implying to...

Pi Securities PCL, Thailand

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