Investment strategy Q3 2013

Investment strategy Q3 2013

- Increase investment from 30% to 40% of portfolio
- Add both global plays and domestic plays
- Top picks: BBL, INTUCH, PTTEP, SVI, TOP, STEC

Drastic correction of the SET (18% from the peak) during the last 2 months of 2Q13 substantially
cooled down the market’s temperature, making the current PER slide from 18x to lower than 14x.
Accordingly, we believe there is only a slim chance of a further decline from the bottom of this round at 1,351 pts and the Index might rebound again in 3Q13 after the Fed gives a clear image of the QE3 cut. However, global stock markets’ fluctuation is still acute because of a change in global monetary policies from the loose to the tight, a complete reverse that would put the markets that have been nurtured by global money supplies through liquidity draining. A key factor to drive the Index from now on would be earnings results of single companies. SET Index is projected to swing within 1,397 – 1,497 pts (current PER of 13-14x) in the next 3 months.

As an investment strategy, we recommend increasing investment from 30% of portfolio, as
suggested in 1Q13, to 40%. Long-term investors should accumulate both global and domestic plays: BBL, BECL, CPALL, CPF, INTUCH, PTTEP, STEC, SVI, and TOP.

For other investment alternatives, we recommend foreign equity funds: ASP S&P 500 and ABEG.