TISCO – 3Q66: ผลประกอบการเป็นไปตามคาด
TOP – พรีวิว 3Q66: คาดกำไรเพิ่มขึ้นทำจุดสูงสุดของปี 2566 Heading back down with small chance of recovery |
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Market today | The SET is expected to weaken to supports of 1,440 and 1,430 due to tension in the Middle East, especially if the fighting spreads, and uncertainty over the Fed’s interest rate direction as US CPI in Sep was higher than expected. A recovery is expected to be limited at resistance of 1,462. | Today’s highlights | • FTI is watching the geopolitical situation closely since a spread would affect the Thai economy directly and indirectly. It says all parties need to plan for any fallout. We expect the government to plan in advance for measures to support energy costs in 2024.
• The Ministry of Energy will ask the Administrative Court to proceed with the signing of the PPA for a 1,500MW wind farm after the Phetchaburi Court ordered a suspension of the Thepsathit Wind Farm. A delay will affect funds invested and electricity price.
• US consumer confidence in Sep was lower than expected, down MoM to the lowest since May.
• The war in the Middle East may spread as Israel expects to launch a land invasion on Gaza Strip, which may affect oil production.
• US has sanctioned for the first time an oil transport company that transported Russian oil priced above the G7 price cap of US$60/bbl, in an attempt to close a loophole in an earlier measure designed to punish Russia for attacking Ukraine.
• The Biden administration plans to close a loophole which allows Chinese companies access US AI chips through overseas branches.
• JPMorgan Chase & Co. reported higher 3Q23 earnings and revenue than expected. Revenue from interest charges was higher than expected while cost of lending was lower than expected. | Strategy today | In the short term the SET is expected to able to recover and rebound. Although the market is still concerned over the war in Israel, Fed officials still support the ending of the interest rate upward cycle, causing US bond yield to slow down and the US dollar to weaken (baht back to appreciate). Also, there are expectations that China will release a 1 trillion-yuan stimulus package and buy into the energy sector to support the stock market index. Our strategy is: take this opportunity to invest in themes with specific drivers. | Trading today | Weekly portfolio: This week the SET is expected to recover or rebound after a sharp fall that already incorporated some of the risks, while the baht is starting to appreciate. We see it as an opportunity to invest in themes with specific drivers:
1) Speculative stocks which are expected to benefit from oil price which rises or is stable at this high level in view of concerns that tension in the Middle East will affect oil supply – PTTEP and BCP.
2) Undervalued stocks (price below true valuation) whose prices have fallen into the oversold zone, with strong fundamentals and inexpensive valuation (PER and PBV 2023F below 5-year average) – CPALL, TOP, CPN, BDMS and MINT.
3) Stocks with strong and continuous earnings growth, whose prices have beat the market since the beginning of the year – AMATA, BBL, KTB, BCH and KLINIQ.
Even though for the tourism sector we keep our 2023 foreign tourist forecast at 28mn with 35mn in 2024, in the short term care should be taken when investing in tourism stocks whose revenue is more attuned to domestic travel (AOT, ERW and CENTEL) and wait for signs that confidence in travel is recovering. In the medium term we recommend being cautious on stocks that are expected to be affected by El Nino, which will erode purchasing power in the agricultural sector: Commerce (GLOBAL), Finance (MTC, SAWAD), Automotive (SAT, STANLY), Food & Agriculture (CPF and GFPT) and Beverages (CBG has high sugar cost). | Daily top picks | BBL: Its profit growth will be strongest in its sector, backed by the largest expansion in NIM on the plus from higher interest rate. It raised its fixed deposit rate by 20-25bps and kept savings rate flat, giving an 8bps upside to margin.
BCP: 3Q23 profit is expected to grow YoY and QoQ, supported by wider GRM and inventory gains, while valuation is inexpensive with 2023F PER and PBV of 5.5x and 0.8x (-1SD), respectively. Dividend yield in 2023 is expected to be 5.5% and increase to 8% in 2024. | Today’s reports | TISCO – 3Q23: In line with estimates
TOP – Preview 3Q23F: surging to 2023’s high |
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