CLSA keen on infrastructure
CLSA shrugged off the heightening political tension by planning to embark on Thailand's infrastructure projects to take advantage of the country's opportunity to become a hub of the Greater Mekong Subregion (GMS).
The equity broker and investment group plans to team up with a Thai partner to invest in infrastructure projects that will connect with other countries in the subregion, CLSA (Thailand) country head Prinn Panitchpakdi said.
Investment will be made through CLSA's private equity investment units operated under its headquarters in Hong Kong.
The company has two equity funds — general private equity funds worth US$2-5 billion and property private equity funds worth about $2 billion — and they have invested across the world.
Both funds largely put their money into Japan, Australia, Hong Kong and Singapore. The minimum investment required for both funds is set at $10 million.
The funds, which have never ploughed money into Thailand, see growth potential opportunity in the GMS, which is expected to deliver the highest economic growth, Mr Prinn said, noting that Thailand, the trading centre for the subregion, will reap the most benefit from infrastructure development.
The Asian Development Bank (ADB) has estimated the GMS's economic growth will average at least 7-8% in the coming years.
Infrastructure projects related to power and telecommunication sectors, tap water and roads in Thailand have good growth potential, Mr Prinn said. Smartphone penetration in Thailand's provincial areas at 50% presents vast room for growth.
"I have seen rapid development in the areas. Border trade is very active, while there are many hotels and resorts under construction. Chiang Saen in Chiang Mai province will be a tourism hub, while Chiang Rai province's logistics, international airport and border trade will show rapid growth," he said.
ADB country director Craig Steffensen said earlier Northern Thailand can reap benefits from development of a logistics service cluster as it serves as a land bridge between East and South Asia and forms a link to Southeast Asia.
The region is well positioned to become a production base for neighbouring countries thanks to availability of suitable technology, research and development and funding sources, while labour and primary raw materials can be freely moved across borders from neighbouring countries.
"CLSA or other foreign investors could shrug off the political situation on the expectation it will end in the second half. A new government from either election or appointment would push towards infrastructure development and boost economic growth," Mr Steffensen said.
CLSA in Thailand also plans to extend its business into the bond market this year while maintaining its focus on research and stock trading. The company is involved in some initial public offering deals with subscriptions due to take place in the second half.