BA: Time to Recover..?

The cabinet greenlighted the country reopening for long-stay tourism from October onwards…What a good news! However, all foreigner visitors will need to quarantine for 14 days upon arrival and have to provide a document such as hotel reservation, or accommodation rental. 

The government expects to welcome about 100-300 tourists per week or not over 1,200 tourists per month, estimating an income of 1,200,000 million baht a month.    

Stocks in travel-related sectors like Airports of Thailand Public Company Limited (AOT), Minor International Public Company Limited (MINT), The Erawan Group Public Company Limited (ERW) and Central Plaza Hotel Public Company Limited (CENTEL) were all edged higher in response to the cabinet’s approval on new measures, leading to a short-term speculation. 

One stock that was foresaw to benefit from relaxing regulations for foreigners entering Thailand is Bangkok Airways Public Company Limited (BA) as this boutique airline has its own airport and luckily located in a pilot model area. 

The long-stay visitors are estimated to spend approx. 5,200 baht/day, which is about twice as much as average spending. 

Besides Phuket, Karbi and Phang Nga, Samui is also a famous destination of Southern Thailand, in which BA owns the airport and operates a direct flight.

As foreign tourists with high-budget are the first group to be welcomed to the country, analysts expected that those visitors are likely to travel to Samui by plane instead of furry (as it kind of wasted their time) and it will utterly benefit BA.   

The beginning of BA to revive from the crisis…the outbreak that severely hit the company.

BA was forced to halt its operation like other airlines in order to curb the virus spreading, resulting in a collapse in profit for the first two quarters, BA has recorded a loss of more than 3,300 million baht.

Moreover, Bangkok Dusit Medical Services Public Company Limited (BDMS), which provides a medical care and treatment service notably to non-thai patients, will also take advantage of Thailand reopening to medical tourism.

If BDMS performance improves, it will enhance BA business growth (BA is the 4th major shareholder of BDMS, holding 5.21% of total shares)

However, it is too early to rejoice as we have yet to receive the feedback from tourists and it is still unclear what measures the government will implement to support the lockdown lifting.