Daily Market Outlook 29 May 2015

1

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Uncertainties abound

Expect the SET to adjust down today, hampered by uncertainties on the local and global fronts. Locally, conflicting outlooks on exports and recent weakness in the MPI, all hurt equities outlook. On the global front, rising concerns over a Greece default and weakness in the economies of key trading partners US and Japan add additional downward pressure on the local bourse.

Pick of the day: IVL (Bt26.50; NR; 15TP Bloomberg

Bt26.28; Settrade Bt28.18)

Indorama Ventures PCL’s earnings prospects for this year and

next are very bright, propelled by continued expansion in price

spreads of the company’s main products, PET and polyester

fibers, and sales volume increases. PET price spreads have

been on the rise after the prices of Paraxylene, the major raw

material for producing PET, have fallen due to recent

oversupply in the region and a decline in naphtha prices. This

bolsters our view that IVL’s earnings have bottomed out and

are in an upward cycle. Sales volume should also increase

significantly following the company’s acquisitions in 2014 and

early this year. In addition, there is a strong possibility that the

company would revert from inventory losses last year to

inventory gains this year as a result of a rising trend in product

prices. According to Bloomberg earnings consensus, IVL’s

earnings this year are expected to surge 148% from the low

base in 2014, decelerating to a still robust 27% growth in 2016.

A buy signal has occurred in both IVL’s daily and weekly

charts. If today the share price manages to close above Bt26,

it means IVL’s price pattern will show a buy signal in its

monthly chart, firmly assuring the share is on an uptrend with

an immediate target at Bt32.75. (Resistance: 27.00, 27.50,

28.75; Support: 26.00, 25.50, 24.40)

Local issues

Conflicting views on exports. The Thai National

Shippers’ Council (TNSC) yesterday said overall exports

would at best see flat growth this year after declines of

0.41% in 2014 and 0.32% in 2013, citing the lack of

innovative products and the low level of oil prices. Deputy

PM MR Pridityathorn however, said the baht is expected to

retreat further against the dollar and its positive effect on

exports should be apparent in 3Q15, saying that exporters

typically took orders up to four months in advance and the

impact of the baht’s pullback would be felt by then.

(Bangkok Post)

Major Indices Close Chg %Chg

SET 1,493.61 -7.2 -0.5

SET50 985.15 -6.2 -0.6

SET P/E (x) 20.3

SET P/BV (x) 2.0

SET Div. Yield (%) 2.9

Dow Jones 18,126.12 -36.9 -0.2

S&P 500 2,120.79 -2.7 -0.1

NASDAQ 5,097.98 -8.6 -0.2

UK 7,040.92 +7.6 +0.1

Germany 11,677.57 -93.6 -0.8

France 5,137.83 -44.7 -0.9

Japan 20,551.46 +78.9 +0.4

South Korea 2,110.89 +3.4 +0.2

Hong Kong 27,454.31 -626.9 -2.2

China 4,620.27 -321.4 -6.5

Taiwan 9,712.84 +19.3 +0.2

Singapore 3,417.77 -7.2 -0.2

Malaysia 1,755.56 +0.5 +0.0

Indonesia 5,237.40 -16.0 -0.3

Philippines 7,505.03 -93.7 -1.2

Trading Summary Buy Sell Net

Institution 3,646 2,489 1,157

Proprietary 3,211 4,398 -1,187

Foreign 8,453 9,178 -726

Individuals 16,200 15,443 756

Total Trading Value 31,509 Btmn

Most Active Value Value Close %Chg

PTT 1,703 350.00 -1.4

TASCO 1,349 18.00 +4.0

KBANK 1,156 196.00 -0.8

TRUE 1,063 11.30 -1.7

CPALL 977 45.75 -

Commodity Futures Close Chg %Chg

US Crude 57.68 +0.2 +0.3

Brent Crude 62.58 +0.5 +0.8

Gold 1,188.10 +2.5 +0.2

FX Rates Close Chg %Chg

USD/THB 33.76 +0.0 +0.0

EUR/USD 1.09 +0.0 +0.4

USD/JPY 123.94 +0.3 +0.2

USD/CNY 6.20 -0.0 -0.0

Source: Bisnews, Bloomberg

Technical picks (support & resistance)

MC (S: 13.30, R: 18.80); IFEC (S: 10.90, R: 12.10);

PTTGC (S: 63.00, R: 67.50); SET (S: 1,470, R: 1,518)

Thailand Research Department

Mr. Warut Siwasariyanon (No.17923) Tel: 02 680 5041

Mr. Krit Suwanpibul (No.17968) Tel: 02 680 5090

Mr. Narudon Rusme, CFA (No.29737) Tel: 02 680 5056

Mr. Napat Siworapongpun (No.49234) Tel: 02 680 5094

Daily Market Outlook 29 May 2015

2

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The Fiscal Policy Office expects the economy to expand by 3.7% this

year provided no less than 70% of the government's investment budget is

disbursed and exports rise by 0.2%. In the first 7 months of fiscal year 2015,

the government disbursed about 58.4% of the total expenditure budget of

Bt2.575tn. Of the total investment budget of Bt449bn, 36.2% was disbursed.

(The Nation)

More investments in SMEs. The Small and Medium Enterprise

Development Bank of Thailand will invest Bt500mn into SMEs under the

SMEs Private Equity Trust Fund to be set up. The details will be submitted

over 2Q15 to the investment committee chaired by the Finance Ministry.

Additionally the bank believes it can achieve its new-loan target of Bt40bn for

this year. (The Nation)

MPI drops over April. The Manufacturing Production Index (MPI) plunged

5.3% MoM from March to April, as some manufacturers took more time off for

Songkran than last year. The automobile industry’s domestic output declined,

but outbound output increased. (The Nation)

DTAC (Bt87.75; 2015 TP Bt99.75) increased its 2015 capex to Bt20bn from

Bt15bn for network expansion. It expects mobile numbers to grow 133% in

2020 from now. DTAC wants NBTC to clarify the road map for overall

spectrum auctions including 700, 850 and 2600 spectrum auction for a better

long-term plan. In addition, it is appointing five “mini CEOs” for Thailand’s five

regions to manage business on a zoning basis. (Post Today, Bangkok Post)

SPALI plans to launch seven condominium projects worth a combined

Bt13bn in Greater Bangkok from Jun-Dec. With expected full-year economic

growth of 3%, the property market to expand by 5-10%. From Jan to mid-May,

the company recorded Bt5.5bn in presales, 5% below target due to sluggish

sales upcountry, but it still expects the full-year presales target of Bt23bn will

be met. (Bangkok Post)

Global issues Mixed messages about Greece’s debt deal: Greece's government said it

aims to reach an agreement with lenders by Sunday. However, a euro zone

official said Greece will not be able to get the money under its current bailout

plan if it does not agree to the outline of a cash-for-reforms deal by the end of

the week. (Reuters)

USA

Wall Street shares edged down on Thursday on an unexpected rise in

weekly jobless claims, mixed messages about Greece's debt talks together

with a sharp drop in Chinese shares after brokers tightened margin rules.

Investors also were cautious ahead of today's reading on US GDP. (Reuters)

US jobless claims unexpectedly rose last week, but remained at levels

consistent with a strengthening labor market. Initial claims for state

unemployment benefits rose 7,000 to a seasonally adjusted 282,000 for the

week last week. Economists had forecast claims slipping to 270,000 last

week. (Reuters)

US previously-owned homes sales rose for a fourth straight month in

April to a 9-year high, buoying the outlook for the housing market and the

overall economy. The National Association of Realtors’ Pending Home Sales

Index increased 3.4% to 112.4 in April. Economists had forecast pending

home sales rising only 0.9% last month. (Reuters)

Daily Market Outlook 29 May 2015

3

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Europe European shares retreated on Thursday, as lingering uncertainty over

Greece's debt problems held back the region's stock markets. (Reuters)

Asia China's stock markets plunged on Thursday, with indexes dropping over

6% in record high turnover as investors rushed to sell after more brokers

tightened margin trading requirements for clients and the central bank drained

money market liquidity. At least three Chinese brokerages tightened margin

requirements. (Reuters)

China's stock market has surged over 140% over the past 12 months

despite a flagging economy, as retail investors piled into world's best

performing market. The outstanding value of margin finance hitting a record

Rmb2.0tn on Tuesday. (Reuters)

Japan's core CPI barely rose in April, casting doubt on the central bank's

view of a steady economic recovery helping accelerate inflation toward its 2%

target. The 0.3% rise in the core CPI, which includes oil products but excludes

fresh food prices, was roughly in line with a median market forecast for a 0.2%

increase. (Reuters)

Japan’s household spending unexpectedly fell in April. Household

spending fell 1.3% YoY in April, confounding expectations of a 3.1% increase.

(Reuters)

Commodities

Falling inventories boost oil. Following two consecutive days of

downwards price adjustment, oil adjusted up on the back of the weakening

greenback, and US crude oil stock figures adjusting down for the fourth

consecutive week. NYMEX moved up 17 cents or 0.3% to close at

US$57.68/barrel while Brent moved up 52 cents or almost 1.0% to

US$62.58/barrel. (Reuters)

Gold propped up by uncertainties. Gold spot moved up 30 cents to

US$1,187.70/ounce on Thursday, supported by the weakening dollar and

falling global equities. (Reuters)

Daily Market Outlook 29 May 2015

4

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Date Regions

26-May-15 US

US

US

27-May-15 US

28-May-15 EU

EU

29-May-15 US

Economic Indicators

Durable Goods Orders (Apr)

Markit PMI (May)

Economic Sentiment Indicator (May)

Consumer Confidence (May)

Gross Domestic Product (Q1)

Housing Price Index (Mar) & New Home Sales (Apr)

Consumer Confidence (May)

Mon Tue Fri

1

4 5 8

XD

AGE

AKR

AQUA

BTNC

DTAC

GYT

ICC

ILINK

KC

NCL

NOBLE

PHOL

SMIT

SPI

TCJ

TPA

XD

AI

BCH

BEC

BRR

CBG

CHO

CI

DEMCO

DSGT

ESTAR

GL

ICHI

KAMART

KCM

LRH

MATI

NC

OCC

PF

PG

PL

PR

PREB

S & J

SABINA

SALEE

SITHAI

SOLAR

SORKON

SSSC

SWC

SYNTEC

TAKUNI

TF

THIP

TNL

TPCORP

TWFP

TWS

VNT

XD

AP

CK

CRANE

ENGY

FE

MATCH

MOONG

NBC

NINE

NMG

RICHY

11 12 15

XD

BJCHI

BLA

CEN

CSR

PCA

STA

TNPC

TPAC

TWZ

XD

CSS

TC

TRC

VIBHA

WHART

XD

IFEC

XD

BWG

SCBLIF

18 19 22

XD

BKKCP

QHPF

TIF1

UNIPF

UOB8TF

25 26 29

XD

SPF

TSC

XD

FUTUREPF

KAMART

TFUND

TLOGIS

XD

AOT

XD

BKI

CPTGF

TCIF

THIF

TREIT

TRIF

TTLPF

27

Thu

28

21

14

7

20

13

6

Wed

May-15

5

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CG Rating

Corporate Governance Report disclaimer

The disclosure of the survey result of the Thai Institute of Directors

Association (“IOD”) regarding corporate governance is made pursuant

to the policy of the Office of the Securities and Exchange Commission.

The survey of the IOD is based on the information of a company listed

on the Stock Exchange of Thailand and the Market for Alternative

Investment disclosed to the public and able to be accessed by a

general public investor. The result, therefore, is from the perspective of

a third party. It is not an evaluation of operation and is not based on

inside information.

The survey result is as of the date appearing in the Corporate

Governance Report of Thai Listed Companies. As a result, the survey

result may be changed after that date, Asia wealth Securities Company

Limited does not conform nor certify the accuracy of such survey result.

Corporate Governance Report of Thai Listed Companies (CGR). CG Rating by the Thai Institute of Directors Association (IOD) in 2014.

Score Range Number of Logo Description

90 – 100

80 – 89

70 – 79

60 – 69

50 – 59

Below 50

No logo given

Excellent

Very Good

Good

Satisfactory

Pass

N/A

BAFS EGCO IRPC KTB PTTEP SAT SIM TOPBCP GRAMMY IVL MINT PTTGC SC SPALIBTS HANA KBANK PSL SAMART SCB TISCOCPN INTUCH KKP PTT SAMTEL SE-ED TMB

AAV BIGC DELTA HMPRO NBC PJW SAMCO SVI TOGACAP BKI DRT ICC NCH PM SCC TCAP TRCADVANC BLA DTAC KCE NINE PPS SINGER TF TRUEANAN BMCL DTC KSL NKI PR SIS THAI TSTEAOT BROOK EASTW LANNA NMG PRANDA SITHAI THANI TSTHASIMAR CENTEL EE LH NSI PS SNC THCOM TTAASK CFRESH ERW LHBANK OCC PT SNP TIP TTWASP CIMBT GBX LOXLEY OFM QH SPI TIPCO TVOBANPU CK GC LPN PAP RATCH SSF TK UACBAY CNT GFPT MACO PE ROBINS SSI TKT VGIBBL CPF GUNKUL MC PG RS SSSC TNITY VNTBECL CSL HEMRAJ MCOT PHOL S&J STA TNL WACOAL

2S BEAUTY CSS IHL MFEC PPM SKR TBSP TSC ZMICOAF BEC DCC INET MJD PPP SMG TEAM TSCAH BFIT DEMCO IRC MODERN PREB SMK TFD TTCLAHC BH DNA IRCP MONO PRG SMPC TFI TUFAIT BJC EA ITD MOONG PRIN SMT THANA TVDAJ BJCHI ESSO KBS MPG PTG SOLAR THIP TWFPAKP BOL FE KGI MTI QLT SPC THREL UMIAKR BTNC FORTH KKC NC QTC SPCG TIC UPAMANAH BWG FPI KTC NTV RCL SPPT TICON UPFAMARIN CCET GENCO L&E NUSA SABINA SST TIW UPOICAMATA CGD GL LRH NWR SALEE STANLY TKS UTAP CGS GLOBAL LST NYT SCBLIF STEC TLUXE UVAPCO CHOW GLOW MAJOR OGC SCCC STPI TMI UWCAPCS CI GOLD MAKRO OISHI SCG SUC TMT VIHAQUA CKP HOTPOT MATCH PACE SEAFCO SWC TNDT WAVEARIP CM HTC MBK PATO SEAOIL SYMC TPC WHAAS CMR HTECH MBKET PB SFP SYNEX TPCORP WINASIA CSC HYDRO MEGA PDI SIAM SYNTEC TRT WINNERAYUD CSP IFS MFC PICO SIRI TASCO TRU YUASA

Source: Thai Institute of Directors (IOD)

6

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Contact

Branch Address Phone Fax

Head Office 540 Floor 7,14,17 , Mercury Tower, Ploenchit Road, Lumphini,

Pathumwan Bangkok 10330

02-680-5000 02-680-5111

Silom 191 Silom Complex Building,21st Floor Room 2,3-1 Silom Rd.,

Silom, Bangrak, Bangkok, 10500 Thailand

02-630-3500 02-630-3530-1

Asok 159 Sermmitr Tower, 17th FL. Room No.1703, Sukhumvit 21

Road, Klong Toey Nua, Wattana, Bangkok 10110

02-261-1314-21 02-261-1328

Pinklao

7/3 Central Plaza Pinklao Office Building Tower B, 16th Flr.,

Room No.1605-1606 Baromrajachonnanee Road, Arunamarin,

Bangkoknoi, Bangkok 10700

02-884-7333 02-884-7357,

02-884-7367

Chaengwattana

99/99 Moo 2 Central Plaza Chaengwattana Office Tower, 22nd

Flr., Room 2204 Chaengwattana Road, Bang Talad, Pakkred,

Nonthaburi 11120

02-119-2300 02-8353006

Chaengwattana 2

9/99 Moo 2 Central Plaza Chaengwattana Office Tower, 22nd Flr.,

Room 2203 Chaengwattana Road, Bang Talad, Pakkred,

Nonthaburi 11120

02-119-2388 02-119-2399

Mega Bangna 39 Moo6 Megabangna, 1st Flr., Room 1632/7 Bangna-Trad

Road, Bangkaew Bangplee, Samutprakarn 10540

02-106-7345 02-105-2070

Rayong 356/18 Sukhumvit Road, Nuen-Phra Sub District, Muang

District, Rayong Province 21000

038-808200 038-807200

Khonkaen 26/9 Srijanmai Road, Tamboonnaimuang, Khon Khaen

40000

043-334-700 043-334-799

Chonburi 55/22 Moo 1, Samed Sub District, Muang District, Chonburi

20000

038-053-858 038-784-090

Chaseongsao 233-233/2 Moo2 1st Flr., Sukprayoon Road, Na Meung Sub-

District, Meung District, Chachoengsao 24000

038-981-587 038-981-591