Analysts Expect the Finance Sector to Grow 24% in 2021, Top-Pick: SAWAD-BAM

The Thai finance sector is expected to grow 24% this year, analysts suggest to keep eyes on particularly SAWAD and BAM as they could potentially cope with debt volatility, while stating that MTC is at high risk from refinance. Analysts also said that the partnership with Government Savings Bank has put SAWAD on a growth path, recommending “BUY” with a target price of ฿84.00/share, and has given a target price of ฿22.70/share to BAM.  

 

Bualuang Securities (BS) estimated the finance sector in 2021 to grow by 24% and Bangkok Commercial Asset Management Public Company Limited (BAM) is BS’s favorite stock, stating that the rising rate of 10-bond by 0.57% YTD could push the cost of debt higher, particularly in its coverage including MTC, SAWAD, KTC and BAM, by 15% in 2021 and 14% in 2022.        

      

Maybank Kim Eng (Maybank) said BAM earnings and dividends have already bottomed out in 2020 and a recovery in 2021 will be a factor to drive the stock price in the next 6-12 months. The new sales strategy will reduce the breakeven point, and it may take time to see results in the mid-end of the year. Maybank assessed that cash collection may take until 2023 to return to growth vs the pre-COVID-19 level. U/G to TRADING BUY to capture a gradual recovery of profit. A target price remains unchanged at ฿22.70/share.