BLS plans to launch more fund products

Even though the company expects average daily turnover on the Stock Exchange of Thailand to continue falling to Bt43 billion, from Bt45 billion last year and about Bt50 billion in the previous year, two more securities houses are set to open.

BLS will maintain its strategy to become the "broker of choice" or "premium broker" by not competing on price and focusing on "revenue share" rather than market share.

BLS averaged a 0.16-per-cent commission last year, better than the market’s 0.14 per cent.

"Since the liberalisation [of commission rates from the fixed 2.5-per-cent regime] in 2012, we have always beaten the market," he said.

BLS has moved up from eighth in 2012 to fifth last year by increasing its share from 4.82 per cent to 4.96 per cent. During the period, its revenue share, which reflects its effective commissions, rose from 5.27 per cent to 6.13 per cent. BLS earned Bt1 billion on revenue of Bt3.06 billion last year, down slightly from Bt1.19 billion and Bt3.31 billion in 2013.

Due to the further slowdown of the stock market, BLS could do little to reverse the trend and expects to book a poorer result this year.

BLS recently established Bangkok Capital to focus on running its fund management business as part of its plan to expand its private and provident fund management services. It has Bt22 billion in private and provident fund assets under management.

"We will look to expand the business further. Around the middle of this year we will inaugurate the business and launch products," he said.

Fund management for high net-worth individuals and corporations is one of BLS’s major businesses besides securities and derivatives brokerage, investment banking, securities trading and unit trust brokerage. Last year, BLS was an adviser for the initial public offerings of four firms: Bangkok Airways, Thai Solar Energy, One to One Contacts and PCS Machine Group Holding. It might be involved in three to four IPOs this year including those of Bangkok Ranch and an energy company. Bannarong Pichyakorn, managing director of sales and trading, said BLS would continue expanding its client base, which has increased from 5 per cent of the market four or five years ago to more than 15 per cent at present. Its share of active stock traders stands at 17 per cent.

Catering to the stock investor base, which has grown from less than 600,000 accounts to more than one million, BLS will pursue more customer segmentation by launching a variety of products and services and continuing to develop innovative investment tools and knowledge advisory services for its clients.

BLS’s income mix in the next three years is not expected to change much from about 60 per cent stock brokerage fees, 20 per cent derivatives trading and 10 per cent investment banking.

Regarding its overseas expansion plan, BLS is still considering the best method and is expected to finally make a move in two to three years.

The suggested investment theme for this year is to go for less expensive stocks, such as banks, telecoms like Advanced Info Services and Intouch, firms that have more certain revenue streams like conventional power companies, life insurers, property funds and infrastructure funds.

BLS commanded the lion’s share of 55 per cent of derivative warrants trading on the local bourse last year. That was down from 65 per cent in 2013 due to fiercer competition.

In stock trading last year, it was ranked fifth after Maybank Kim Eng Securities (Thailand), Kasikorn Securities, CIMB Securities (Thailand) and Finansia Syrus Securities.