TTA Gains 4% as Freight Rates Continue Upward Trend

The share price of Thoresen Thai Agencies Public Company Limited (TTA) rose ฿0.50/share or 3.85% to ฿13.50/share as of 15:58 local time in Thailand, with a trading value of 375 million baht.

KTBST Securities (KTBST) is bullish on the Baltic Dry index’s (BDI) current upward trend, believing it will benefit shipping stocks. Port congestion in China with COVID-19 control measures, seasonality in iron ore shipping, and a global energy boom in Europe and Asia are all leading to an increase in freight rates. So it resulted in a record-high price for natural gas, carbon, and coal. The arrival of winter is also likely to enhance the demand for coal.

Additionally, since coal prices are approaching the break-even point, numerous power plants in China have been temporarily shut down, and the Chinese government aims to increase electricity tariffs to relieve the country’s energy shortage. China’s coal imports are projected to increase if the government revises the electricity bill.

KTBST maintains its view that freight rates will remain high in 3Q21-4Q21 due to the high season of logistics. TTA is the top pick stock with a given target price of 21 baht.