Daily Strategy for Investors on September 5, 2019

Asia Wealth Securities (AWS) has made an analysis for the trading session on September 5, 2019, pointing out some of the must-know events in the equity market as follows:

 

Thai Stock Market Today:

Thai stock market revised up sharply benefitting from (1) Hong Kong’s Hang Seng stock market that soared by nearly 1,000 points, or +4% from the news of the withdrawal of extradition law to China. (2) Investors that began to lessen their concern on the no-deal Brexit after the English opposition party successfully took over the legislative process of the Parliament to hinder the no-deal Brexit process. (3) The Moody’s Investors Service to may increase the credit level of Thailand. (4) The New York Business Index, which rebounded to 50.3 in August from 43.5 in July. We believe that under the current situation; even though the global economy is weakened because of the trade war, there will be a way out when reaching the dead end.

 

Investment Idea:

1) All roads are heading toward the investment in electricity and water supply in Vietnam. Beneficiaries are WHA, WHAUP and BGRIM, while those preparing to be benefitted but have not yet finalized are AMATA, AMATAV, GULF, EGCO etc.

2) Oil prices revised up by 4% / freight rate kept climbing up, while PSL may face the Bt9.70 resistance.

3) Foreign countries are cautious of the weak economy as a result of the ongoing trade war. However, there are only positive factors on less concern driving by the situation in Hong Kong and England.

4) The Economic Cabinet meeting rescheduled from 30 August to 6 September, focusing on stimulating export – private investment.

5) Today’s index range is expected to be 1,640-1,666 points. Recommended stocks are AMATA, WHAUP and PTTEP.

 

Stock & Comment

AMATA  – TP ฿29.00/share

WHAUP – TP ฿8.00/share

PTTEP – TP ฿148.00/share

 

Pick of the day: AMATA (AWS TP ฿29.00/share)

1) Expect the 2H19 performance to revise up higher than in the 1H19.

2) The 2019 presales target is 950 rai. In the 1H19, there were presales of 300 rai with over Bt3.0bn backlog of which around 70-80% will gradually be recognized as revenue in 2019.

3) Benefit from the prolonged US-China trade war which benefits industrial estates in Vietnam and Thailand. AMATA has this business base in both Vietnam and Thailand.

4) AMATAV, a subsidiary of the company, is expected to begin to recognize revenue from all three estates in Vietnam at the end of this year.

5) Profit allocation from power plant business will revise up from the COD of all power plants.

6) Investment plans for an industrial estate in Myanmar, the Framework Agreement has already been signed. The investment plan is likely to be concluded at the end of this year.

7) AMATA is very strong in a full uptrend from the occurrence of Daily, Weekly, & Monthly Buy Signal with a significant target to reach a new high of Bt33 and a short-term stop loss of Bt24.20 (Resistance: 27.00, 27.50, 28.25; Support: 26.25, 25.75, 25.00)