xfdws FOREIGN-INVESTMENT sked Emerging Markets Datafile<\/p>\n
October 01, 2003<\/p>\n
NATION<\/p>\n
THAILAND<\/p>\n
ENGLISH<\/p>\n
FOREIGN INVESTMENT: Hedge funds biggest SET players, NATION<\/p>\n
Siriporn Chanjindamanee<\/p>\n
ASIA WorldSources, Inc. 322 MASSACHUSETTS AVENUE 2ND FLOOR, NE WASHINGTON, DC 20002 COPYRIGHT 2003 BY WORLDSOURCES, INC., A JOINT VENTURE OF FDCH e-Media, INC. AND WORLD TIMES, INC. NO PORTION OF THE MATERIALS CONTAINED HEREIN MAY BE USED IN ANY MEDIA WITHOUT ATTRIBUTION TO WORLDSOURCES, INC.<\/p>\n
Most of the money pumped into the Thai stock market by foreign investors over the last couple of years has been spent by hedge funds, a securities analyst said yesterday.<\/p>\n
This is not necessarily cause for alarm, however, said Intel Vision Securities president Sriporn Suthipong, because like other types of stock investors, hedge funds measure their performance according to stock-market indices-and at the moment the Thai bourse is showing handsome returns.<\/p>\n
Hedge funds have a reputation for being quick to jump from one market to another when they see a chance for better returns.<\/p>\n
The Thai exchange has been one of the best performers in the region over the past two years.<\/p>\n
Last month, foreign investors-who have a strong influence on sentiment in the Stock Exchange of Thailand-were net sellers, unloading more than Bt11 billion worth of stock. For the year, however, foreign investors remain net buyers of Thai stocks to the tune of Bt7 billion.<\/p>\n
”Foreign investors’ recent selling spree may trigger a fluctuation in the stock market, but local investors should not worry too much about it,” Sriporn said. “All they have to do is monitor information and their [the foreign investors’] behaviour.”<\/p>\n
Investors should choose stocks with sound fundamentals in sectors benefiting from the country’s buoyant domestic consumption, such as the tourism, automobile, agriculture and property sectors, she said.<\/p>\n
She also predicted that banks’ shares would perform well next year as many that issued high-cost hybrid securities plan to redeem them ahead of schedule.<\/p>\n
”However, investors don’t need to rush to pile up bank stocks just yet. I believe they can buy the stocks later this year, as there will be little change in their prices,” she added.<\/p>\n
Kongkiat Opaswongkarn, of Asset Plus Securities, said long-term institutional investors had shown more interest since the composite SET index broke through the key 500-point level recently.<\/p>\n
Although the market has soared dramatically recently, Thai shares’ price to equity (P\/E) ratio is a mere 10 times-well below its peak of 30 times in 1990. “If the P\/E ratio of the Thai stock market goes up to 15 times next year, it would still be acceptable, but corporate earnings growth must support the increase,” Kongkiat said. The market’s price-to-book value remains relatively low at two times, while enterprise value, another indicator of whether a share price is too high, has stayed at five times-well below its high of 15 times in 1996.<\/p>\n
Thai corporations’ rush to list on the SET further illustrates the market’s bull-run, he said. His firm expects to be involved in more than 10 IPOs before year-enEchoing Sriporn, Kongkiat said bank stocks would turn bullish next year after their early redemption of hybrid securities.<\/p>\n
”The outlook for the overall stock market appears bullish until 2005, but the market’s direction in 2006 is hard to predict, as interest rates may go up at that time,” he said.<\/p>\n
A trader at a local brokerage, meanwhile, warned that investors should be cautious because foreign investors are locking in profits on Thai shares traded on the stock market as they prepare to scoop up initial public offering shares.<\/p>\n
The Electricity Generating Authority of Thailand, CP Seven-Eleven, Beer Thai (1991), Rayong Purifier and Thai Olefins are some of the firms lining up to list on the stock exchange.d.<\/p>\n
Copyright 2003 NATION all rights reserved as distributed by WorldSources, Inc.<\/p>\n","protected":false},"excerpt":{"rendered":"
xfdws FOREIGN-INVESTMENT sked Emerging Markets Datafile October 01, 2003 NATION THAILAND ENGLISH FOREIGN INVESTMENT: Hedge funds biggest SET players, NATION Siriporn Chanjindamanee ASIA WorldSources, Inc. 322 MASSACHUSETTS AVENUE 2ND FLOOR, NE WASHINGTON, DC 20002 COPYRIGHT 2003 BY WORLDSOURCES, INC., A […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-1241","post","type-post","status-publish","format-standard","hentry","category-hedgeco-news"],"_links":{"self":[{"href":"https:\/\/www.hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/1241","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.hedgeco.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.hedgeco.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.hedgeco.net\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.hedgeco.net\/news\/wp-json\/wp\/v2\/comments?post=1241"}],"version-history":[{"count":0,"href":"https:\/\/www.hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/1241\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.hedgeco.net\/news\/wp-json\/wp\/v2\/media?parent=1241"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.hedgeco.net\/news\/wp-json\/wp\/v2\/categories?post=1241"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.hedgeco.net\/news\/wp-json\/wp\/v2\/tags?post=1241"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}