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| • EXCH RATES |
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Baht/$ 33.47/52
Bid/Ask
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GOLD |
15,200
- 50
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INVESTING
NUNTAWUN POLKUAMDEE
Fund managers are bracing for low interest as subscriptions start for the SET energy exchange-traded fund today.
The Mtrack Energy ETF, managed by TMB Asset Management, will hold its initial subscription period from today until July 28, with a listing on the Stock Exchange of Thailand set for Aug 7.
The fund will track shares listed on the SET energy index, and include in its portfolio market blue-chips such as PTT Plc, PTT Exploration and Production, Banpu and Thai Oil. The energy sector accounts for 35% of the total market capitalisation of the SET.
But weak market sentiment has led fund managers to sharply cut back expectations for the fund, the country's second ETF to the ThaiDex SET50 ETF.
Jotika Savanananda, managing director of TMB Asset Management, said the fund could end up at around 300 million baht in initial subscriptions.
This is down from previous targets of 500 million baht and sharply below the fund's registered size of three billion. Mrs Jotika said the IPO could be priced as low as four baht per unit, using a formula of the energy index divided by 4,000.
The energy sector index, which traded at the end of 2007 at more than 22,000 points, ended Friday at 15,609.12, or down nearly 30% for the year.
Kiticharn Sirisukarcha, an analyst for Kim Eng Securities, said the decline stemmed from heavy foreign selling of the Thai market.
The energy sector's earnings-per-share have fallen to just 8.4 times as of last week compared with 12 to 13 times in 2007, he said.
"The outlook for the energy sector will continue to fluctuate in the second half based on foreign fund flows and oil prices," Mr Kiticharn said.
Mrs Jotika said that for medium- to long-term investors, the timing was right to accumulate fundamentally solid stocks.
"In fact, this is a good opportunity to buy as investors can expect strong capital gains once market sentiment turns," she said. "But right now, sentiment is quite weak, and we are anticipating the energy ETF to come in around 300 million baht."
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