KSS’ “Chaiyot” Warns Investors to be Cautious for Foreign Investors’ Selloff in May!
KSS’ “Chaiyot” Warns Investors to be Cautious for Foreign Investors’ Selloff in May, while Asserting that the Valuation of Thai Market is not Cheap!
Mr. Chaiyot Jiwangkul, assistant director of the analytic department of Krungsri Securities, through “Kaohoon Jor Talad” program on April 29, 2020, stated that the Thai stock market could edge higher to be in line with regional markets, however, the valuation of Thai stock market is not cheap with a PE ratio os 16x, while the Philippines and Indonesia traded at 12x-14x.
Due to a high valuation in the market, SET Index could have a limited upside, expecting to be around 1,300 points. Moreover, the PE ratio has already surged higher than the actual fundamental when the earnings in 1Q20 are expected to decline.
Mr. Chaiyot viewed the easing lockdown measures to have a positive sentiment on investors, coupled with a single-digit new coronavirus case to heighten the sentiment even more.
As for the commerce sector, which has been expecting to reopen the department store around June, Mr. Chaiyot said that the share prices have already risen in hopes of the reopening. However, once the operations are back after a lockdown, investors could have made a selloff if the traffic after the reopening does not meet the market expectation.
Moreover, Mr. Chaiyot advised investors to be cautious in May as the historical data showed that out of 10 years, Foreign Investors mostly made a net sell in May for 7 years. Thus, the movement in May might not be as good as April.