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>Greater clarity after the general election should ease worries over a possible coup and a delay in the formation of a coalition government, which we expect to consist of three parties, i.e., the Pheu Thai Party, the Palang Pracharath Party and the Bhumjaithai Party, in our base-case scenario; this would reduce the risk premium of the SET Index, pushing it up to our target of 1,607 points.</li><li>Historical data from the five most recent elections shows that the SET increased by an average of +3.47% in the month after they were held; and in the week before and after the general elections took place, the index rose by 1.87% and 3.81%, respectively.</li><li>The biggest gainers were the finance, property development and ICT sectors. We thus recommend speculating on SIRI, SC, SCB, KBANK, CPALL, INTUCH, ADVANC and MINT.</li></ul>

Greater clarity after the general election should ease worries over a possible coup and a delay in the formation of a coalition government, which we expect to consist of three parties, i.e., the Pheu Thai Party, the Palang Pracharath Party and the Bhumjaithai Party, in our base-case scenario; this would reduce the risk premium of the SET Index, pushing it up to our target of 1,607 points.Historical data from the five most recent elections shows that the SET increased by an average of +3.47% in the month after they were held; and in the week before and after the general elections took place, the index rose by 1.87% and 3.81%, respectively.The biggest gainers were the finance, property development and ICT sectors. We thus recommend speculating on SIRI, SC, SCB, KBANK, CPALL, INTUCH, ADVANC and MINT.

Special Report: Election Rally (History to Repeat Itself)

Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/krung-thai-bank-pub-co-ltd" target="_blank" data-smartkarma-citation="entities:298:1" rel="noopener">Krung Thai Bank Pub (KTB TB)</a> remains our pick; it ranks top in terms of post-provision profitability, screens well on NPL coverage, funding and valuations, including its attractive PEG ratio</li>
<li>We also like <a href="https://www.smartkarma.com/entities/bank-of-ayudhya-pcl" target="_blank" data-smartkarma-citation="entities:136:1" rel="noopener">Bank Of Ayudhya (BAY TB)</a>, with its sound pre and post-provision profitability in 1Q23, strong credit quality metrics and very attractive valuations</li>
<li>Kasikorn has seen its high cost of risk come down in 1Q23, but this remains elevated versus its domestic peers; Kasikorn may be a 2023 opportunity, one for the watchlist</li>
</ul>



Krung Thai Bank Pub (KTB TB) remains our pick; it ranks top in terms of post-provision profitability, screens well on NPL coverage, funding and valuations, including its attractive PEG ratio
We also like Bank Of Ayudhya (BAY TB), with its sound pre and post-provision profitability in 1Q23, strong credit quality metrics and very attractive valuations
Kasikorn has seen its high cost of risk come down in 1Q23, but this remains elevated versus its domestic peers; Kasikorn may be a 2023 opportunity, one for the watchlist


Thai Banks 4Q22 Screener; We Reiterate that Krung Thai Is Our Top Pick

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/bangkok-bank-public-co-ltd" target="_blank" data-smartkarma-citation="entities:213:1" rel="noopener">Bangkok Bank (BBL TB)</a> has outperformed <a href="https://www.smartkarma.com/entities/kasikornbank-pcl" target="_blank" data-smartkarma-citation="entities:293:1" rel="noopener">Kasikornbank PCL (KBANK TB)</a> by 33% over the last 11 months and the price ratio is nearing the high end of the historical range.</li>
<li>The number of NVDRs issued on <a href="https://www.smartkarma.com/entities/bangkok-bank-public-co-ltd" target="_blank" data-smartkarma-citation="entities:213:1" rel="noopener">Bangkok Bank Public (BBL TB)</a> have continued to increase while decreasing on <a href="https://www.smartkarma.com/entities/kasikornbank-pcl" target="_blank" data-smartkarma-citation="entities:293:1" rel="noopener">Kasikornbank PCL (KBANK TB)</a>.</li>
<li>
<a href="https://www.smartkarma.com/entities/bangkok-bank-public-co-ltd" target="_blank" data-smartkarma-citation="entities:213:1" rel="noopener">Bangkok Bank Public (BBL TB)</a> now trades at a higher forward PE as compared to <a href="https://www.smartkarma.com/entities/kasikornbank-pcl" target="_blank" data-smartkarma-citation="entities:293:1" rel="noopener">Kasikornbank PCL (KBANK TB)</a> and the gap in price to book has narrowed significantly.</li>
</ul>



Bangkok Bank (BBL TB) has outperformed Kasikornbank PCL (KBANK TB) by 33% over the last 11 months and the price ratio is nearing the high end of the historical range.
The number of NVDRs issued on Bangkok Bank Public (BBL TB) have continued to increase while decreasing on Kasikornbank PCL (KBANK TB).

Bangkok Bank Public (BBL TB) now trades at a higher forward PE as compared to Kasikornbank PCL (KBANK TB) and the gap in price to book has narrowed significantly.


BBL/KBANK: Huge Outperformance as BBL Nears NVDR Limit

ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

<ul>
<li>
<a href="https://www.smartkarma.com/entities/siam-commercial-bank-scb-x" target="_blank" data-smartkarma-citation="entities:214:1" rel="noopener">Siam Commercial Bank (SCB TB)</a> booked a solid set of 4Q2022 results, with the first NIM expansion in two years and record high net interest income.</li>
<li>The bank also provided details of its mothership strategy, which has now come to fruition, with the restructuring process now complete with its increasingly strong digital credentials becoming clearer.</li>
<li>
<a href="https://www.smartkarma.com/entities/siam-commercial-bank-scb-x" target="_blank" data-smartkarma-citation="entities:214:1" rel="noopener">Siam Commercial Bank</a> remains attractive on valuations and probably deserves to trade at a premium to peers given its digital credentials but more data may be required to get there.</li>
</ul>



Siam Commercial Bank (SCB TB) booked a solid set of 4Q2022 results, with the first NIM expansion in two years and record high net interest income.
The bank also provided details of its mothership strategy, which has now come to fruition, with the restructuring process now complete with its increasingly strong digital credentials becoming clearer.

Siam Commercial Bank remains attractive on valuations and probably deserves to trade at a premium to peers given its digital credentials but more data may be required to get there.


Siam Commercial Bank (SCB TB) - Traversing Generations

<ul>
<li>
<a href="https://www.smartkarma.com/entities/kasikornbank-pcl" target="_blank" data-smartkarma-citation="entities:293:1" rel="noopener">Kasikornbank PCL (KBANK TB)</a> remains one of Thailand's top-tier banks with particular strength in SME lending and consumer lending making it a beneficiary of both consumption and tourism recovery. </li>
<li>The bank continues to grow its digital banking and business through its K PLUS app which now has more than 21m users, with multiple use cases and self-apply loan applications. </li>
<li>
<a href="https://www.smartkarma.com/entities/kasikornbank-pcl" target="_blank" data-smartkarma-citation="entities:293:1" rel="noopener">Kasikornbank</a> remains a core holding for exposure to Thailand's tourism-driven recovery through its SME exposure. Valuations are attractive with the bank trading at 0.7x FY2023 PBV and 8.3% FY2023E ROE. </li>
</ul>



Kasikornbank PCL (KBANK TB) remains one of Thailand's top-tier banks with particular strength in SME lending and consumer lending making it a beneficiary of both consumption and tourism recovery. 
The bank continues to grow its digital banking and business through its K PLUS app which now has more than 21m users, with multiple use cases and self-apply loan applications. 

Kasikornbank remains a core holding for exposure to Thailand's tourism-driven recovery through its SME exposure. Valuations are attractive with the bank trading at 0.7x FY2023 PBV and 8.3% FY2023E ROE. 


Kasikornbank PCL (KBANK TB) - Replanting the Seeds of Growth

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: Election Rally (History to Repeat Itself)

The biggest gainers were the finance, property development and ICT sectors. We thus recommend speculating on SIRI, SC, SCB, KBANK, CPALL, INTUCH,...

Krungthai XSpring

Thai Banks 4Q22 Screener; We Reiterate that Krung Thai Is Our Top Pick

KrungThai is our top pick with its premium profitability, healthy NPL coverage, funding and valuations, along with its low PEG ratio; we also like...

Victor Galliano

BBL/KBANK: Huge Outperformance as BBL Nears NVDR Limit

BBL has outperformed KBANK by 33% over the last 11 months. The price ratio is nearing the high end of the historical range. BBL trades at a higher...

Brian Freitas

Siam Commercial Bank (SCB TB) - Traversing Generations

Siam Commercial Bank remains attractive on valuations and probably deserves to trade at a premium to peers given its digital credentials but more...

Angus Mackintosh

Kasikornbank PCL (KBANK TB) - Replanting the Seeds of Growth

Kasikornbank is a core holding for exposure to Thailand's tourism-driven recovery through its SME exposure. Valuations are attractive with the bank...

Angus Mackintosh

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