Analysts concur that the current valuation of Thailand’s SET Index at approximately 1,300 points presents an attractive investment opportunity, with Thai stocks offering some of the highest dividend yields among global securities.
At a recent stocks seminar at the Stock Exchange of Thailand (SET) in collaboration with “Kaohoon Turakij” and the Thai Stock Exchange, Win Phromphaet, the EVP and Head of the High Net-Worth Division at Bank of Ayudhya Bank Public Company Limited (SET: BAY), reaffirmed the appeal of Thai stocks at the 1,300 points level and emphasized the high dividend yields. He also highlighted the potential for inflows from foreign investors following the US Federal Reserve’s rate cut as they have been divesting Thai equities.
Phromphaet further noted that the restructuring of the Thai ESG Fund could offer a buying opportunity since the Thai stock index is currently at a relatively low point. He pointed out that infrastructure funds could stand out once the Fed reduces interest rates, despite their underperformance, as they continue to provide dividend yields of 8-10%.
Sorapon Weerametheekul, the Head of Investment Strategy at Kasikorn Securities, mentioned that the recent decline in the SET Index to 1,280 points has limited further downside and anticipated a more positive outlook in the second half of the year, supported by exports and foreign investment in data centers, which are expected to boost Thai GDP and EPS at a faster pace than in the first half.
The lifting of political uncertainties in the second half of the year, as anticipated by Kasem Prunratanamala, the Head of Thailand Research at CGSI Thailand, is seen as a catalyst for a potential rebound of the Thai stock market. However, sustained economic growth and the impact of Fed rate cuts will be crucial. Prunratanamala recommended investors focus on US presidential election-related stocks, data centers, and exports to mitigate risks associated with Thai political issues. As the political situation stabilizes after the third quarter, it is suggested to consider sectors that have lagged, such as property, consumer finance, and banks.
Additionally, Kobsak Pootrakool, the Bangkok Bank Director and Senior Executive Vice President and Corporate Secretary, and Director of the Federation of Thai Capital Market Organizations (FETCO), mentioned that the adjustment of the Thailand ESG Fund conditions is currently being evaluated by the Thai government, presenting an opportunity to attract a new generation of investors.
