Returns of other Asian stocks are poised to outpace those of Thai shares this year, attracting Thai investors to explore better yields on Asian bourses.
Csellak: Thais should look beyond home
The profit growth of listed Asian firms is expected to be 15-25% while Thai listed companies lag behind at 15-20%, said Linda Csellak, head of Asia-Pacific equities at Manulife Asset Management.
"Given the figures, it's time for investors to explore new opportunities outside the country," said Mrs Csellak.
Asian stocks, especially small-cap ones, continue to show good prospects on expectations that economies will keep growing strongly, she said.
Manulife's Thai unit last year launched Asian Small Cap Equity FIF (MS-Asian SM), the master fund of Manulife Asset Management Asia-Pacific.
The fund this year will have weightings in China (35%), Korea (15.7%) and Taiwan (15%) and raise the Thai weighting from 3.1% to 4.9%.
Sectors the fund is overweight in will include consumption, IT, industry and finance.
Mrs Csellak said the fund is invested in six Thai firms, including BTS Holding Group. Plans call for increasing the skytrain operator's share of the portfolio if it successfully implements an infrastructure fund and a fare rise.
"BTS is also looking to invest in property, as the government seems to prefer a low interest rate policy," she said.
Mrs Csellak was recently rated a AAA fund manager by Citywire Global for her strong record. The fund has delivered a return of 31.5% since its launch in January 2012, while the benchmark MSCI AC Asia Pacific Ex Japan Small Cap Index has returned less than 5.5%.
Mrs Csellak describes her strategy as investing in Asian small caps with strong growth potential.
She said liquidity should be abundant in Asia as loose monetary policy remains in place across the region and in major economies around the globe.
"Asia has been enjoying huge fund inflows, and we expect this to continue in 2013," she said. "China's economy has shown signs of regaining strength over the past few months, and Chinese equities are very attractive."
Economic growth should remain robust in Southeast Asia, driven by consumer and infrastructure spending in Thailand, Malaysia, Indonesia and the Philippines.
Labour-heavy industries increasingly favour the region as a production base.
Mrs Csellak said the target return of MS-Asian SM this year may rise in line with earnings growth, but the fund will select only high-growth stocks.
The master fund's size is now US$150 million. The feeder fund in Thailand has assets worth 570 million baht.