Future's bright for economy, capital market
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THE Thai economy and capital market outlook are expected to be better in the second half of the year while the US and EU markets are appealing, with healthcare leading the way, according to Krungsri Asset Management.
“The Thai capital market is performing in a positive direction, so investors do not have to be bearish on Thai equities,” Alan Cam, director of KSAM, said yesterday.
Investors with Thai equities in their portfolio should hold onto them, while new buyers should seek companies that are inclined to give good returns within three to five years. These companies need to have strong fundamentals.
Companies involved with petroleum production, energy and consumer goods are expected to have a bright future.
Companies in renewable energy merit the attention of investors due to higher demand, but stakes should be in the form of private equities. Also, the market for gas indicates an efficient outlook as its price is expected to increase soon.
Supaporn Leenabanchong, acting chief investment officer, said equities in the tourism industry have been performing very well since the beginning of the year and are still interesting.
“There have not been significant cancellations of trips to the country,” she said, adding that the Mers situation did not have much of an effect on the tourism outlook.
The Stock Exchange of Thailand Index will fluctuate in the second half of the year in the range of 1,480-1,600. Greece’s debt crisis did not have a major impact on the SET.
The earnings of listed companies look to improve in the remainder of the year along with the economy, while the average price-to-earnings ratio (PE) of the market is 13 times, which is not that expensive, she added.
Cam said the eurozone and US markets are still appealing, especially small and medium companies, which are not that expensive at the moment. SMEs are more resistant to global market volatility, as they concentrate on the domestic market.
According to the global market outlook, the increasing trend of ageing populations and advanced medical technology make a story for healthcare investment, while prices are still reasonable.
Morgan Asset Management said that in 10 years the number of elderly citizens will be extremely high, and healthcare services stand to cash in on that.
Also, the new innovation in medical technology called “genome sequencing” will create waves for businesses in the industry including pharmaceutical and other healthcare services.
The technology will enable an accurate prediction of possible diseases from a patient’s genes and will help prevent those diseases efficiently.
The prices of the securities in this industry in both domestic and international markets do not exceed the normal range. This industry has room to grow substantially in the future.
Healthcare is one of the priorities of the government’s reform plan.
