Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

<ul>
<li>The June 2024 index changes for Thailand's SET 50 index were announced after market close yesterday (17th June 2024).</li>
<li>Initially we <a href="https://www.smartkarma.com/insights/quiddity-leaderboard-set50-jun-24-3-changes-likely-banpu-still-not-safe-from-deletion" target="_blank" rel="noopener">expected only three changes</a> but after the index methodology was revised in May 2024, we <a href="https://www.smartkarma.com/insights/quiddity-leaderboard-set50-jun-24-banpu-vs-sawad-has-to-be-monitored-closely" target="_blank" rel="noopener">revised our expectations</a> and we had 4 expected ADDs/DELs.</li>
<li>All 4 expected ADDs/DELs turned out to correct. In this insight, we take a look at our estimation of expected flows and potential trade ideas based on the flow dynamics.</li>
</ul>


The June 2024 index changes for Thailand's SET 50 index were announced after market close yesterday (17th June 2024).
Initially we expected only three changes but after the index methodology was revised in May 2024, we revised our expectations and we had 4 expected ADDs/DELs.
All 4 expected ADDs/DELs turned out to correct. In this insight, we take a look at our estimation of expected flows and potential trade ideas based on the flow dynamics.


Quiddity SET 50 Jun 24 Rebal: 4 Changes Confirmed; LONGs up 5.2% Vs SHORTs in a Month

<ul>
<li>The SET50 index tracks the performance of the top 50 largest and most liquid names listed on the Stock Exchange of Thailand (SET).</li>
<li>In this insight, we take a look at the potential ADDs/DELs for SET during the index rebal event in June 2024.</li>
<li>Although 80% of the 3-month reference period is now complete, it is still possible for the rankings to change.</li>
</ul>


The SET50 index tracks the performance of the top 50 largest and most liquid names listed on the Stock Exchange of Thailand (SET).
In this insight, we take a look at the potential ADDs/DELs for SET during the index rebal event in June 2024.
Although 80% of the 3-month reference period is now complete, it is still possible for the rankings to change.


Quiddity Leaderboard SET50 Jun 24: BANPU Vs SAWAD Has to Be Monitored Closely

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.

Equity Bottom-Up

<ul><li>We maintain an Outperform rating, with a new fair value of Bt21.87 (vs. Bt24.11), based on the earnings yield and a revised required rate of return of 7.9% (vs. 6.8%) following the adjustment to the macroeconomic factors used for the beta <span style="font-size: var(--content-font-size);">calculation based on our new house view.</span></li><li>The valuation metrics suggest that there is still implied upside of 8% to the current share price and that the long-term growth outlook is strong.</li><li>Meanwhile, the tactical downside risk is limited</li></ul>

We maintain an Outperform rating, with a new fair value of Bt21.87 (vs. Bt24.11), based on the earnings yield and a revised required rate of return of 7.9% (vs. 6.8%) following the adjustment to the macroeconomic factors used for the beta calculation based on our new house view.The valuation metrics suggest that there is still implied upside of 8% to the current share price and that the long-term growth outlook is strong.Meanwhile, the tactical downside risk is limited

<ul><li>We maintain our Outperform rating, based on the earnings yield and a required rate of return of 6.8%.</li><li>The valuation metrics suggest that the share price is fundamentally undervalued, while the 2024-26E earnings growth prospects are strong, and the tactical view is neutral.</li><li>The 1Q24 net profit amounted to Bt1,104mn (+15.6% YoY and +22.5% QoQ), beating our forecast by 9%, as the cost-to-income ratio and the provision were smaller than expected.</li></ul>

We maintain our Outperform rating, based on the earnings yield and a required rate of return of 6.8%.The valuation metrics suggest that the share price is fundamentally undervalued, while the 2024-26E earnings growth prospects are strong, and the tactical view is neutral.The 1Q24 net profit amounted to Bt1,104mn (+15.6% YoY and +22.5% QoQ), beating our forecast by 9%, as the cost-to-income ratio and the provision were smaller than expected.

Ngern Tid Lor - Upbeat 1Q24 Earnings with Lower Credit Costs QoQ

<ul><li>TIDLOR has announced a planned restructuring of its shareholding and management, which involves establishing a holding company named Tidlor Holdings Public Company Limited (Tidlor Holdings).</li><li>This restructuring entails a tender offer to purchase all shares of TIDLOR from shareholders, with Tidlor Holdings issuing new ordinary shares in exchange for TIDLOR’s existing ordinary shares at a swap ratio of one-to-one.</li><li>Following the tender offer, Tidlor Holdings will replace TIDLOR on the SET, with TIDLOR being delisted on the same day.</li></ul>

TIDLOR has announced a planned restructuring of its shareholding and management, which involves establishing a holding company named Tidlor Holdings Public Company Limited (Tidlor Holdings).This restructuring entails a tender offer to purchase all shares of TIDLOR from shareholders, with Tidlor Holdings issuing new ordinary shares in exchange for TIDLOR’s existing ordinary shares at a swap ratio of one-to-one.Following the tender offer, Tidlor Holdings will replace TIDLOR on the SET, with TIDLOR being delisted on the same day.

Ngern Tid Lor Plc. - TIDLOR Announces Shareholding and Management Restructuring Plans

Thailand

Ngern Tid Lor Public Company Limited operates as a microfinance company. The Company offers auto finance and insurance products and services. Ngern Tid Lor serves customers in Thailand.

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Ngern Tid Lor (TIDLOR TB)

Quiddity SET 50 Jun 24 Rebal: 4 Changes Confirmed; LONGs up 5.2% Vs SHORTs in a Month

Our sector-neutral trade ideas have generated a long-short return of 5.2% in a month which was significantly better than being LONG 4 Expected ADDs...

Janaghan Jeyakumar, CFA

Quiddity Leaderboard SET50 Jun 24: BANPU Vs SAWAD Has to Be Monitored Closely

After considering the recent methodology changes (relaxing the liquidity criteria), we believe BJC will be added in June 2024 and that could cause...

Janaghan Jeyakumar, CFA

NGERN TID LOR - Earnings Recovery Path

The valuation metrics suggest that there is still implied upside of 8% to the current share price and that the long-term growth outlook is strong.

Krungthai XSpring

Ngern Tid Lor - Upbeat 1Q24 Earnings with Lower Credit Costs QoQ

The valuation metrics suggest that the share price is fundamentally undervalued, while the 2024-26E earnings growth prospects are strong, and the...

Krungthai XSpring

Ngern Tid Lor Plc. - TIDLOR Announces Shareholding and Management Restructuring Plans

TIDLOR has announced a planned restructuring of its shareholding and management, which involves establishing a holding company named Tidlor...

Krungthai XSpring

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