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>Krung Thai remains our sole best value pick among the Thai banks, having solid post-provision profitability, delivering double digit ROE, a sound balance sheet and attractive PBV and PE ratios</li>
<li>Krung Thai has the highest core capital ratios as well as delivering the best returns of the peer group, with reassuring metrics in terms of credit quality</li>
<li>Its share price is the best performer year-to-date, but we still see it to be attractively valued and the recent correction is a buying opportunity</li>
</ul>


Krung Thai remains our sole best value pick among the Thai banks, having solid post-provision profitability, delivering double digit ROE, a sound balance sheet and attractive PBV and PE ratios
Krung Thai has the highest core capital ratios as well as delivering the best returns of the peer group, with reassuring metrics in terms of credit quality
Its share price is the best performer year-to-date, but we still see it to be attractively valued and the recent correction is a buying opportunity


Thai Banks 3Q24 Screener; Krung Thai Offers the Best Value Relative to the Returns Outlook

<ul>
<li>Krung Thai is our value pick among Thai banks, having solid post-provision profitability, close to double digit ROE with a healthy balance sheet, along with undemanding PBV and PE ratios</li>
<li>We maintain Kasikorn on the buy list, as its cost of risk was well contained in 1Q24, a key positive catalyst for its improving post-provision returns</li>
<li>Bank of Thailand is currently accepting applications for digital banking licenses until 19 September 2024; incumbent banks and domestic big corporates are likely to form the core of applicants</li>
</ul>


Krung Thai is our value pick among Thai banks, having solid post-provision profitability, close to double digit ROE with a healthy balance sheet, along with undemanding PBV and PE ratios
We maintain Kasikorn on the buy list, as its cost of risk was well contained in 1Q24, a key positive catalyst for its improving post-provision returns
Bank of Thailand is currently accepting applications for digital banking licenses until 19 September 2024; incumbent banks and domestic big corporates are likely to form the core of applicants


Thai Banks 1Q24 Screener; We Stick with Krung Thai for Best Value, Kasikorn for Positive Catalysts

<ul>
<li>Krung Thai is our sole best value pick among the Thai banks, having solid post-provision profitability, near double digit ROE, a sound balance sheet and attractive PBV and PE ratios</li>
<li>We downgrade Kasikorn from buy to neutral, as it has an unattractive PEG and we believe it is more exposed to credit quality deterioration and potential cost of risk reversal</li>
<li>Bank Ayudhya is suffering from further credit quality deterioration which led to spike in its cost of risk; it now has the lowest NPL coverage relative to the peer group</li>
</ul>


Krung Thai is our sole best value pick among the Thai banks, having solid post-provision profitability, near double digit ROE, a sound balance sheet and attractive PBV and PE ratios
We downgrade Kasikorn from buy to neutral, as it has an unattractive PEG and we believe it is more exposed to credit quality deterioration and potential cost of risk reversal
Bank Ayudhya is suffering from further credit quality deterioration which led to spike in its cost of risk; it now has the lowest NPL coverage relative to the peer group


Thai Banks 2Q24 Screener; We Stick with Krung Thai for Best Value, We Downgrade Kasikorn to Neutral

<ul>
<li>Krung Thai has solid post-provision profitability, close to double digit ROE with a healthy balance sheet, along with attractive PBV and PE ratios</li>
<li>We add Kasikorn to the buy list, as its cost of risk sharply improved in 4Q23, suggesting that it peaked in 3Q23; this should improve post-provision returns going forward</li>
<li>We remove Ayudhya from the buy list, as its worsening cost of risk trends are eroding post-provision returns; it is also relatively weak in terms of capital adequacy</li>
</ul>


Krung Thai has solid post-provision profitability, close to double digit ROE with a healthy balance sheet, along with attractive PBV and PE ratios
We add Kasikorn to the buy list, as its cost of risk sharply improved in 4Q23, suggesting that it peaked in 3Q23; this should improve post-provision returns going forward
We remove Ayudhya from the buy list, as its worsening cost of risk trends are eroding post-provision returns; it is also relatively weak in terms of capital adequacy


Thai Banks 4Q23 Screener; Stick with Krung Thai, Switch Out of Ayudhya into Kasikorn

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>The latest Global Fund Manager Survey by Bank of America polled 179 global fund managers with a total NAV of USD503bn.</li><li>The survey, which took place between November 1-7, includes 22% of responses gathered after the US election results were announced — reflecting partial recognition of the outcome, with Trump being elected US president and the Republican Party likely to have control of both the House of Representatives and the Senate.</li><li>The survey reveals significant shifts in asset allocations in response to these developments. The shift is driven by the US economy showing stronger signs of a "no landing" scenario, while the global downward interest rate cycle appears less pronounced than previously expected. </li></ul>

The latest Global Fund Manager Survey by Bank of America polled 179 global fund managers with a total NAV of USD503bn.The survey, which took place between November 1-7, includes 22% of responses gathered after the US election results were announced — reflecting partial recognition of the outcome, with Trump being elected US president and the Republican Party likely to have control of both the House of Representatives and the Senate.The survey reveals significant shifts in asset allocations in response to these developments. The shift is driven by the US economy showing stronger signs of a "no landing" scenario, while the global downward interest rate cycle appears less pronounced than previously expected. 

FMS Outlook Following Trump's Victory as US President - November 19, 2024

Thailand

Krung Thai Bank Public Company Limited is a state-owned commercial bank offering various banking and financial services including commercial, consumer, credit card, and mortgage loans, as well as provident fund management, foreign exchange, and international trade financing services.  The Bank is majority owned by the Financial Institutions Development Fund.

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Krung Thai Bank Pub (KTB TB)

Thai Banks 3Q24 Screener; Krung Thai Offers the Best Value Relative to the Returns Outlook

Krung Thai continues to stand out as our top pick among Thai banks, with its sound profitability, high ROE, solid balance sheet and attractive...

Victor Galliano

Thai Banks 1Q24 Screener; We Stick with Krung Thai for Best Value, Kasikorn for Positive Catalysts

Krung Thai is our preferred pick for its value for healthy return, solid capital ratio with Kasikornbank continuing to deliver on improving...

Victor Galliano

Thai Banks 2Q24 Screener; We Stick with Krung Thai for Best Value, We Downgrade Kasikorn to Neutral

Krung Thai is our value Thai bank pick, with best of peers ROE and a strong balance sheet, while Kasikorn is downgraded to neutral due to credit...

Victor Galliano

Thai Banks 4Q23 Screener; Stick with Krung Thai, Switch Out of Ayudhya into Kasikorn

Krung Thai has strong profitability, a healthy balance sheet and attractive valuations. Kasikorn's cost of risk has improved, hints at potentially...

Victor Galliano

FMS Outlook Following Trump's Victory as US President - November 19, 2024

The survey, which took place between November 1-7, includes 22% of responses gathered after the US election results were announced — reflecting...

Krungthai XSpring

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Thai Banks 3Q24 Screener; Krung Thai Offers the Best Value Relative to the Returns Outlook

​Krung Thai continues to stand out as our top pick among Thai banks, with its sound profitability, high ROE, solid balance sheet and attractive...

Victor Galliano

Thai Banks 1Q24 Screener; We Stick with Krung Thai for Best Value, Kasikorn for Positive Catalysts

​Krung Thai is our preferred pick for its value for healthy return, solid capital ratio with Kasikornbank continuing to deliver on improving...

Victor Galliano

Thai Banks 2Q24 Screener; We Stick with Krung Thai for Best Value, We Downgrade Kasikorn to Neutral

​Krung Thai is our value Thai bank pick, with best of peers ROE and a strong balance sheet, while Kasikorn is downgraded to neutral due to credit...

Victor Galliano

Thai Banks 4Q23 Screener; Stick with Krung Thai, Switch Out of Ayudhya into Kasikorn

​Krung Thai has strong profitability, a healthy balance sheet and attractive valuations. Kasikorn's cost of risk has improved, hints at potentially...

Victor Galliano

FMS Outlook Following Trump's Victory as US President - November 19, 2024

The survey, which took place between November 1-7, includes 22% of responses gathered after the US election results were announced — reflecting...

Krungthai XSpring

Krung Thai continues to stand out as our top pick among Thai banks, with its sound profitability, high ROE, solid balance sheet and attractive...

Krung Thai is our preferred pick for its value for healthy return, solid capital ratio with Kasikornbank continuing to deliver on improving...

Krung Thai is our value Thai bank pick, with best of peers ROE and a strong balance sheet, while Kasikorn is downgraded to neutral due to credit...

Krung Thai has strong profitability, a healthy balance sheet and attractive valuations. Kasikorn's cost of risk has improved, hints at potentially...