Daily Strategy for Investors on September 6, 2019

Asia Wealth Securities (AWS) has made an analysis for the trading session on September 6, 2019, pointing out some of the must-know events in the equity market as follows:

 

Thai Stock Market Today:

1) Keep an eye on the US-China ministerial negotiation in early October.

2) The US private sector employment data in August was up by 195,000 positions which are more than the expected 140,000 positions and the largest increase in 4 months.

3) UK stock market is still pressured by the Brexit issue, while German and French stocks revised up in response to the news on negotiation between the US and China in early October and the expectation of the monetary policy easing at the ECB meeting on 12 September 2019.

4) For the Fed and BOJ meeting on 19 September, investors focus on the Fed’s rate cut in this round of meeting.

5) For the economic cabinet today, investors should focus on the western section of MRT Orange Line, as well as the special measure for EEC.

6) BDI freight rate closed at 2,499 points or -19 points (-0.75%) which is the first drop after being positive for 10 consecutive business days.

7) Expect index range to be 1,658-1,680 points. AWS expects it is difficult for the index to break through the resistance of 1,680 points.

8) Recommended stocks are MTC, OSP, and ANAN.

 

Stock & Comment

MTC – TP ฿60.00/share

OSP – TP ฿45.00/share

ANAN – TP ฿4.50/share from the expectation of high profit in the second half of the year. There will be an “opportunity day” today.

BEM – TP ฿12.50/share

 

Pick of the day: MTC (TP Bt60.00)

1) The financial group has benefited from the downtrend of interest rate as well as the postponement of the enforcement of capping a borrower’s debt -service ratio (DSR) by the BOT.

2) MTC has benefited from the credit rating upgrade from BBB to BBB+ since May 2019, resulting in a lower financial cost for loan issuance.

3) The 2H19 performance of MTC is expected to grow continuously. MTC prepares to gradually open more branches to reach the target set at 600  branches (460 branches were opened in the 1H19 ). AWS expects the loan growth rate to be at 27%. (It grew by 13.4% YTD in the 1H19)

4) Target price of Bt 60 .00 is calculated from the company’s compound annual growth rate (CAGR) of net profit over the next 2 years at 26%and 1x PEG.

5) MTC is very strong in a full uptrend from the occurrence of Daily, Weekly, and Monthly Buy Signal. The main target is at Bt61.50 and short-term stop loss point is at Bt54.25 (Resistance: 56.75 , 57.25 , 58.00 ; Support: 56.00 , 55.50 , 54.75)