Daily Strategy for Investors on October 9, 2019

Asia Wealth Securities (AWS) has made an analysis for the trading session on October 9, 2019, pointing out some of the must-know events in the equity market as follows:

 

Investment Ideas:

1) Investors concern about trade negotiation between the US and China on 10-11 October in Washington.

2) The US announced to suspend visa issuance for Chinese officials who involved in the persecution of Muslims in Xinjiang.

3) The Fed’s President announced last night that the Fed will soon increase its balance sheet through the purchase of short-term Treasury securities (equivalent to QE expansion)

4) Chinese shares listed on the New York stock market have fallen mostly due to the report that the White House is discussing blocking US pension funds to invest in China.

5) BDI freight rate closed on the latest working day at 1,801.00 points which was up by 31.00 points or +1.75%.

6) SCB has the most promising performance in the banking sector as it has extra profits from sales of SCBLIFE.

7) KKP, BPP will swing away SET50 if AWC enters the trading.

8) Many listed companies in the property sector start to announce their Presales which are still moving forward such as ORI and SC. Recommend “TRADING”.

9) For CKP, the water situation in the dam has greatly improved but it is not as good as in 2018. However, there is a better recognition of electricity fee thermal generating units of BIC 1 and BIC 2. Return to find an opportunity to buy.

10) Today’s index range is expected to be 1,602-1,622 points. Recommended stocks are ORI, CKP and SC.

 

Stock & Comment

ORI – TP ฿11.50/share

CKP – TP ฿7.60/share

SC – TP ฿4.00/share

 

Pick of the day: ORI (BUY; AWS TP Bt11.50)

ORI recorded the 3Q19 presales at Bt10.2bn (-6% YoY but +40% QoQ) which increased from the 2Q19 due to the launch of three projects under “The Origin” brand and two projects under the “Park Origin” brand. All projects have an average Take Up Rate higher than 80% which is considered the highest in the industry. As a result, in 9M19, the company’s presales were Bt23.1bn , representing 83% of the target in 2019.

In 4Q19, ORI prepares to launch seven projects worth over Bt14bn which will help accelerate sales and revenue for the remaining of the year. It is expected that Recurring Income to increase in the 4Q19 due to a plan to open two hotels in November and, in the future, it will bring 10 hotels worth over Bt30bn to the REIT.

The company has benefited from the prolonged conflict in Hong Kong. The company has penetrated the market through DWG which is an expert agency in Singapore and Hong Kong markets.

ORI is likely to be in the uptrend from the occurrence of Monthly Buy Signal; however, it remains in a short-term and medium-term base adjustment from the occurrence of Daily and Weekly Sell Signal. When considering ORI, its first target is at Bt8.45 and the next target is Bt9.75, respectively (Resistance: 7.50, 7.65, 7.80; Support: 7.25, 7.10, 6.95)