Thailand corporate profit outlook bleakest in Southeast Asia

Thailand corporate profit outlook bleakest in Southeast Asia

A large queue forms in front of a gold shop in Yaowarat on Wednesday. (Photo by Pornprom Satrabhaya)
A large queue forms in front of a gold shop in Yaowarat on Wednesday. (Photo by Pornprom Satrabhaya)

Estimating and comparing companies’ results in the first quarter since the Covid-19 outbreak is more a guessing game than a science. By any measure, though, the outlook for Thailand Inc is more bleak than for peers across Southeast Asia.

Earnings predictions for companies in the MSCI Thailand Index have been slashed by 23% on average so far this year, the biggest reduction among Southeast Asia’s five major stock markets, according to data compiled by Bloomberg. By contrast, the profit outlook for regional peers has been lowered in a range between 9.6% for the Philippines to 14.4% for Singapore. Analysts globally have been slow to adjust profit estimates as economic uncertainty mounts and a growing number of companies stop giving guidance.

“Thai corporate earnings estimates are likely to be reduced further with weak economic growth,” said Apichat Poobunjirdkul, a senior strategist at Tisco Securities. “The recent rebound for Thai equities is still very fragile because the Covid-19 outbreak is ongoing.”

The Stock Exchange of Thailand index earlier this month rallied more than 20% from its recent low in March, putting it in bull territory, as investor optimism rose with the government’s economic stimulus measures and a slowing of new Covid-19 infections. But Thai stocks still haven’t fully priced in earnings-growth risk as there will likely be “significant” cuts in the consensus outlook, according to a UBS AG report published April 13.

The nation’s biggest lenders, including Siam Commercial Bank, Kasikornbank and Bangkok Bank, are scheduled to kick off earnings season this week when they report first-quarter results.


Do you like the content of this article?
COMMENT (18)

Domestic flights allowed to operate at full capacity

Domestic flights may fly at full capacity from 75% previously starting on Saturday, in line with the relaxation of Covid-19 restrictions.

12:35

Luk thung legend Pornsak dies aged 60

Legendary luk thung and mor lam singer Pornsak Songsang collapsed at his house in Nong Bua Lam Phu province and died at a hospital on Friday night. He was 60.

11:18

Drug bill changes to 'lighten sentences'

A new bill that will give drug convicts the chance to reduce their jail terms is set to become law, according to the Department of Corrections.

10:00