Daily Strategy for Investors on December 23, 2019

Asia Wealth Securities (AWS) has made an analysis for the trading session on December 23, 2019, pointing out some of the must-know events in the equity market as follows:

 

Investment Ideas:

1) During the last 6 business days of the year, AWS expects Window Dressing, LTF and RMF to help driving the market.

2) Large listed companies gradually sell their shares to minimize the impact of the new accounting standards IFRS9.

3) For AOT, the number of passengers (1 – 12 December) increased by 6.1%YoY to grow in the slow rate for 2 months executive from October to November at 11.4%YoY and 9.9%YoY, respectively. However, AWS believes the number of foreign passengers 1Q19/20 (Oct-Dec 2019) will be recovered QoQ and YoY. The decrease in AOT share price is good for an investment opportunity.

4) Palang Pracharat won the by-election in Khon Kaen’s Constituency 7 adding an additional vote for the government.

5) International markets remain bright, while the US and European markets continue to increase.

6) This week’s Thai stock market is expected to be 1,555 -1,630 points. Recommended stocks are KBANK and BBL.

7) Today’s Thai stock market is expected to be 1,565 -1,585 points. Recommended stocks are KBANK, BBL, HMPRO, CPALL and JKN.

 

Stock & Comment
KBANK – TP ฿182.00/share
BBL – TP ฿223.00/share
HMPRO – TP ฿19.00/share
CPALL – TP ฿94.00/share
JKN – TP ฿8.60/share

 

Pick of the day: KBANK(BUY; AWS TP Bt182)

KBANK is outstanding as a leader business transformation to Digital Platform Banking, which is an integration of offline services which are branches and online services together. In addition, KBANK collaborates with leading digital business partners conducting business on the bank’s own platform, as it would like to meet the needs and becomes part of customer’s life in all dimensions. Recently, KBANK has operates (1) JV and Line for Social Banking (2) Invest in Grab, Grab Wallet and PTT Wallet (3) Co-lending with Shopee (4) invests in world-class tech startups and grants for Open Innovation

Recently, KBANK reported loan growth in November 2019 to grow 1.2%MoM (3.63%YTD), which is better than the group average. Commercial banks grew by 0.2%MoM, most of which continued to grow from retail loans that grew by around 5%YTD. For the entire 2019, KBANK is expected to grow within the projected range of 5-7%.

AWS expects KBANK’s share price to improve during the last curve of the year due to the inflows of LTF, RMF trading as window dressing despite major concern on the implementation of new accounting standards, IFRS9, on 1 January 2020 which will result in more stringent debtor classification. The provision may increase in the midst of a weak and risky economy. However, KBANK shares are currently trading at only 0.89x PBV, compared to the 5-year average of 1.43x. The share price is too cheap and AWS expects the share price has already revised down in response with the news on new accounting standard. AWS, therefore, recommends “BUY” with a target price of Bt182 based on 1.0x Prospective PBV.