Four stocks up from MSCI inclusion

INTUCH gained 7.7 per cent on Friday to close at Bt97.25 while MINT gained 7.7 per cent to Bt28. HMPRO gained 0.6 per cent to Bt15.90 while TRUE was up 1.6 per cent to Bt9.75.
In this round, INTUCH is one of the three largest additions to the MSCI Emerging Markets Index measured by full company market capitalisation, aside from Suzano Papel E Celulose (Brazil), and Oil India (India).
From June 1, their closing prices will be used for calculation of the indices.
Tisco Securities noted that its research partner, Deutsche Bank, estimated that inclusion in the MSCI would boost foreign investment in HMPRO by US$48.7 million (Bt1.45 billion) and in MINT by $37 million, which should be a boon for their share prices in the short term.
HMPRO plans 10 new stores in Thailand this year and two in Malaysia by 2015, while MINT targets to increase the number of hotels under management by six this year.
For investors looking for short-term gains, Asia Plus Securities noted that statistically, stocks selected for the global standard indices tend to generate average returns of 8.3 per cent. “The possibility of positive return is 100 per cent if the stocks are accumulated about one week before the starting date [of the new calculation] and sold on the day,” it said.
Its favourite is INTUCH, which – with a fair value of Bt98 – presents a higher upside gain than other stocks. Long-term revenue growth forecast is stable, with 2013 earnings expected to expand 21 per cent year on year, offering a 6 per cent dividend yield.
Twenty Thai stocks have also been added to the MSCI Global Small Cap Indices calculation – Ananda Development, Bangkok Metro, Eastern Water Resources Development, Energy Absolute, GMM Grammy, Gunkul Engineering, Jay Mart, Krungthai Card, Malee Sampran, Natural Park, Officemate, Oishi Group, Samart Telecoms, SPCG, Thai Factory Development, Thai Reinsurance, The Union Mosaic Industry, Univentures, VGI Global Media and WHA Corporation.
Asia Plus recommended investment in the stocks a day before the new calculation starts, for average return of 1.5-1.9 per cent. But as most stocks are traded above fair value, it recommended Oishi and Thai Reinsurance, which are still traded below their respective fair values of Bt216.3 and Bt8.
The Stock Exchange of Thailand announced the inclusion on Thursday, after the index provider MSCI’s review the day before. Consequently, there are a total of 26 Thai stocks in the MSCI Global Standard Indices.
“These additions will encourage foreign investors to add weighting to the Thai stock market and show that listed Thai companies have expanded in terms of size and liquidity. Also, the weight of the Thai stock market in the MSCI AC Asia, ex-Japan, has continuously increased during the past two years,” said SET president Charamporn Jotikasthira.
There are several types of MSCI indices, divided by region, country, size, sector, etc.