SCGP to Enter SET50 upon Arrival, TCAP and ERW at Risk of Excluding from the Index

Analysts expected SCGP to enter the SET50/100 this October with market capitalization of 140 – 150 billion baht, affecting TCAP and ERW to be excluded from the SET50 and SET100 respectively, while 18 funds poured 23 billion baht in preparation for the investment in SCGP. Recommended small-cap stocks with solid fundamentals such as THCOM, INSET and NOBLE. 

 

Asia Plus Securities (ASP) foresaw that SCG Packaging Public Company Limited (SCGP) is eligible to be included in both SET50 and SET100 (fast-track inclusion) upon arrival this October. Both institutional and foreign investors are highly interested and robustly subscribing to SCGP IPO shares. While expecting Thanachart Capital (TCAP) to be delisted from the SET50, along with The Erawan Group Public Company Limited (ERW) delisting from the SET100. 

Investors are probably rebalancing portfolios before subscribing to SCGP (similar to other massive IPO shares in the past 1-2 years), therefore the SET Index is expected to be highly volatile from now on.

 

Institutions may sell other stocks at 23 billion baht before SCGP listing. Institutional investors can subscribe to SCGP IPO shares between October 5 – 7, 2020, while 18 local and foreign funds are cornerstone investors subscribing for 677 million shares worth 23.7 billion baht. Funds may sell some stocks before buying SCGP shares, so SET Index is anticipated to be highly volatile. Then, retail investors can subscribe to SCGP IPO shares around October 1 – 2, and 5, 2020.

 

Consequently, ASP recommended small-cap stocks with solid fundamentals that may enjoy continuous retail buying. Top picks are Thaicom Public Company Limited (THCOM), Infraset Public Company Limited (INSET), and Noble Development Public Company Limited (NOBLE).