MACROECONOMICS WEEKLY UPDATE

According to the  Commerce ministry, Thailand’s exports rose 7.8% YoY in September from 7.5% YoY in August. For 9-month exports rose 10.6% YoY, exports expanded well as a shortage of supply had begun to unravel and a weak Thai baht. While September imports increased 15.6% YoY and 9-month imports rose 20.9% YoY ,Thailand had a deficit trade of 853.2 million US dollars in September and made a 9-month deficit trade of 14,984.9 million US dollars .

INDUSTRY   

The Federation of Thai Industries (FTI) has reported that auto output in September recovered to a 9M-high 179,237 units.Exports show signs of recovery, reaching 106,190 units, accounting for 59.25% of total output. Domestic sales soared +16% YoY to 74,150 units. Economic activities in the month of September are recovering from the return of foreign tourists and foreign investors because of eased travel restrictions. Exports in the said month  were the highest in 9 months, up +36% YoY to 100,389 units amidst the chip storage crisis .

PROPERTIES 

The Thailand cabinet approved a plan to allow high-income foreigners to buy landed houses of not more than 1 rai in exchange for making a 40 millions Baht investment with a minimum 3-year period. 

It is expected that developers focused on the upper segment will benefit the most, notably SC, LH and SIRI , as homes with selling prices of minimum 20 millions Baht account for 67%, 50% and 37% of their portfolios.

BANKING AND FINANCE

Net Interest Income grows but NPLs varies, BBL showed the strongest QoQ profit growth, while KTB showed the strongest YoY growth. 9M22 net profit total B156bn, growing 13.5% YoY and making up 77% of Bloomberg consensus. 4Q22 net profit is projected to drop QoQ due to higher operating expense rise (seasonal effect) and tax expense from SCB’s organization restructuring. Asset quality still has to be watched closely. End-3Q22 NPL was B500bn, decreasing 4.6% QoQ and 4.4% YTD, mainly from NPL write-off and NPL sales of B54bn (led by KBANK and SCB), resulting in end-3Q22 NPL/Loan of 3.55%, down from 3.76% at end-2Q22 and 3.83% at end-2021

Fast-Moving Consumer Goods

The impact from a change in feed cost in 4Q22 should be largely muted as the increase in corn price offsets the decrease in soybean meal price.

Domestic pork price is still at Bt103.5/kg , whole chicken price dropped 2% to Bt45.5/kg as flooding in many areas softened demand.

Charoen Pokphand Foods (CPF), GFPT (GFPT) and Thai ifoods Group (TFG), are expected to report earnings growth both YoY and QoQ for 3Q22 due mainly to strong domestic meat prices and robust chicken export.

Information and Communication Technologies 

NBTC agrees to DTAC/TRUE amalgamationResolution No. 1: NBTC board members voted 3:2 in favor of DTAC-TRUE’s merger, which is based on the announcement in 2018 that the NBTC only has a duty to acknowledge the merger and introduce conditions to protect the public interest.Resolution No. 2. Important measures introduced

Price ceiling capped. NBTC wants subscriber-weighted-average service fees to be reduced by 12% within 90 days after the merger.

Both TRUE and DTAC must keep their brands separate for 3 years.

Its 5G network must cover 85% of the population within 3 years and 90% of the population within 5 years of the merge  JASIF unit holders reject ADVANC’s proposed changes to a lease contract, the voting of JASIF shareholders on Oct 18, each agenda item required a quorum of 75% of votes to pass

Rejected – (i) the waiver of and/or amendment to certain provisions relating to the lease and rental payment of optical fiber cables–69% voted in favor (did not meet minimum requirement of 75%).

In the next phase, ADVANC will decide whether to move ahead with the deal. Additional leasing cost will be THB3bn until 2025 and will be THB1.4bn in 2025-2032. ADVANC’s board must assess the additional benefits in the future of its broadband business, such as cost saving synergies and the drop in competition, and whether such benefits will be sufficient to offset the additional costs involved

Thailand SET Index

SET index trade in 1580 – 1620 with PE 15.2X 

Foreign investors were net buy in both equities and derivatives market for 5-day in row