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

<ul>
<li>Downgrade our recommendation from BUY to HOLD with a target price of Bt54. Despite the challenges in Myanmar. MEGA reported 2Q22 net profit of Bt570m (+13%YoY, -7%QoQ), in-line our expectation </li>
<li>Another strong quarterly performance Excluding extraordinary items, core profit was at Bt544m (+16%YoY, -13%QoQ). The 1H22 result accounted for 56% of our 2022E.</li>
<li>The YoY growth in earnings supported by 1) Mega We care’s sales grew to Bt2bn (+19%YoY)and close to the highest level in 3Q21,and 2) gross profit margin expanded to 42.6% </li>
</ul>


Downgrade our recommendation from BUY to HOLD with a target price of Bt54. Despite the challenges in Myanmar. MEGA reported 2Q22 net profit of Bt570m (+13%YoY, -7%QoQ), in-line our expectation 
Another strong quarterly performance Excluding extraordinary items, core profit was at Bt544m (+16%YoY, -13%QoQ). The 1H22 result accounted for 56% of our 2022E.
The YoY growth in earnings supported by 1) Mega We care’s sales grew to Bt2bn (+19%YoY)and close to the highest level in 3Q21,and 2) gross profit margin expanded to 42.6% 


MEGA : Strong Performance Amid Uncertainty

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)

<div><div><div><div><ul><li>Yesterday, our Big Cap portfolio generated a return of +0.33% vs. the SET Index’s return of +0.35%.</li><li>The share prices of stocks under the reopening theme showed healthy increases, namely BDMS (+2.78%), MAJOR (+1.47%) and CENTEL (+1.2%).</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. </p></div></div></li></ul></div></div></div></div>

Yesterday, our Big Cap portfolio generated a return of +0.33% vs. the SET Index’s return of +0.35%.The share prices of stocks under the reopening theme showed healthy increases, namely BDMS (+2.78%), MAJOR (+1.47%) and CENTEL (+1.2%).GULF is a holding company engaging in core businesses relating to the generation and distribution of power based on natural gas and alternative energy. 

<ul><li>We expect the SET Index to move up, with the support at 1,555/1,530 points and the resistance at 1,600/1,616 points, on the back of foreign investors’ short covering and the risk-on mode for risk assets.</li><li>This is based on the assumption that the Fed will slow down its interest rate hikes from September onward after inflation already peaked out on a MoM basis following lower commodity prices and the US economy entered a technical recession.</li><li>Investment strategy: Buy blue chip stocks whose prices have fallen since June and stocks expected to report good earnings results: We recommend JMT, JMART, SINGER, MTC, COM7, FORTH, CRC, DTAC, MEGA and EA.</li></ul>

We expect the SET Index to move up, with the support at 1,555/1,530 points and the resistance at 1,600/1,616 points, on the back of foreign investors’ short covering and the risk-on mode for risk assets.This is based on the assumption that the Fed will slow down its interest rate hikes from September onward after inflation already peaked out on a MoM basis following lower commodity prices and the US economy entered a technical recession.Investment strategy: Buy blue chip stocks whose prices have fallen since June and stocks expected to report good earnings results: We recommend JMT, JMART, SINGER, MTC, COM7, FORTH, CRC, DTAC, MEGA and EA.

<ul><li>We recommend buying MEGA and MAJOR.</li><li>MEGA’s share price has rebounded by more than 5% over the past two weeks on the market’s expectations for a limited impact from Myanmar’s government ordering the suspension of loan repayments in foreign currencies.</li><li>The firm’s 2022E earnings are forecast to grow 8.68% YoY to Bt2,116mn, driven by the depreciation of the baht, the development of new projects and expansion to new markets with low competition.</li></ul>

We recommend buying MEGA and MAJOR.MEGA’s share price has rebounded by more than 5% over the past two weeks on the market’s expectations for a limited impact from Myanmar’s government ordering the suspension of loan repayments in foreign currencies.The firm’s 2022E earnings are forecast to grow 8.68% YoY to Bt2,116mn, driven by the depreciation of the baht, the development of new projects and expansion to new markets with low competition.

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.

<ul>
<li>We highlight 14 stocks in Asia that look interesting to us based on our FVMR methodology</li>
<li>Portfolio changes: Five stock remains, and nine new join the fray</li>
<li>Since its inception, the portfolio has gained 75% versus MSCI Asia ex Japan's 64%</li>
</ul>


We highlight 14 stocks in Asia that look interesting to us based on our FVMR methodology
Portfolio changes: Five stock remains, and nine new join the fray
Since its inception, the portfolio has gained 75% versus MSCI Asia ex Japan's 64%


Thailand

Mega Lifesciences PCL manufactures, markets and distributes nutritional and herbal supplement, OTC and ethical drugs. The Company produces products that range from treating internal issues to overall general health.

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Mega Lifesciences (MEGA TB)

MEGA : Strong Performance Amid Uncertainty

Downgrade our recommendation from BUY to HOLD with a target price of Bt54. Despite the challenges in Myanmar. MEGA reported 2Q22 net profit of...

Pi Securities PCL, Thailand

Big Cap Tactical Picks - August 4, 2022

Yesterday, our Big Cap portfolio generated a return of +0.33% vs. the SET Index’s return of +0.35%. The share prices of stocks under the reopening...

Krungthai XSpring

Monthly Report - August 2022

We expect the SET Index to move up, with the support at 1,555/1,530 points and the resistance at 1,600/1,616 points, on the back of foreign...

Krungthai XSpring

Big Cap Tactical Picks - Aug 3, 2022

MEGA’s share price has rebounded by more than 5% over the past two weeks on the market’s expectations for a limited impact from Myanmar’s government

Krungthai XSpring

The Stocks to Own in Asia – Vol. 36

We highlight 14 stocks in Asia that look interesting to us based on our FVMR Methodology. Portfolio changes: Five stock remains, and nine new join...

A. Stotz Investment Research

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