DBS Vickers Securities (DBSVS) forecasted that the SET Index would trade between 1,580 and 1,680 points this week, based on the following factors: 1) US 10-Year Bond Yield fell from 1.63% to 1.43%, reflecting the market’s perception that interest rates have not risen rapidly. (The Federal Reserve will meet on June 16), while the US consumer confidence index increased to 86.4 in June (from 82.9 in May).
2) Many countries worldwide are accelerating their vaccination campaigns and gradually reducing lockdown restrictions. 3) Iran has little chance of expanding crude oil production to the global market in the near future. 4) Enacted more stimulus measures in Thailand, including debt relief for retails and SMEs, and increased public spending.
5) The arrival of additional Covid-19 vaccines in Thailand. 6) The number of new Covid19 infections daily in Thailand is gradually decreasing. As a result, DBSVS has chosen three attractive food stocks for investing this week.
CPF : “BUY” recommendation with a target price of ฿43.00/share, Upside 59%
Despite being impacted by the third wave of Covid-19, the outlook for Charoen Pokphand Foods Public Company Limited (CPF) in 2H21 remains healthy and positive, as Thailand and the majority of European countries continue to ease Covid-19 restrictions, restoring full production capacity for food and animal feed.
Additionally, CPF announced the launch of CP Selection’s new product, the premium plant-based, in Thailand in May 2021 and in other markets later this month. China, Japan, the United States, and the European Union are the primary export markets.
RBF : “BUY” recommendation with a target price of ฿22.90/share, Upside 23%
Just like CPF, R&B Food Supply Public Company Limited (RBF) is likely to improve its operating results in 2H21, despite the fresh wave of Covid-19 outbreak. As restrictions are lifted, it is anticipated that the food and hotel industries would expand HoH.
Net income for 2022 is expected to increase by 50+/- %, principally due to the upstream business, which is supported by the cannabis-hemp business. Furthermore, the seasonings industry has a promising long-term growth outlook.
NRF : “BUY” recommendation with a target price of ฿12.00/share, Upside 19%
Earnings for NR Instant Produce Public Company Limited (NRF) are expected to increase YoY and QoQ in 2Q21 as a result of the acquisition of City Food in December 2020 and E-commerce business Prime Labs in early 2021, as well as the company’s entry into the hemp and terpene business through a partnership with its allies. Net profit is expected to increase by 60% and 48% in 2021-2022, respectively.