STRATEGY UPDATE

Model Portfolio
Add tourism stocks

22 June 2015
SET target: 1570 (YE15)
Index closing (19/6/15): 1491.46
Stock picks
Rec.

Investment thesis

The scope for upside includes positive economic data flows among
developed markets and emerging markets, which could lift the tide of
the overall equity market.

ROE

DY

(%)

(%)

15E

15E

15E

0.7

10.7

0.0

14.6

87.8

6.0

(x)

(x)

15E

15E

6.5 1,107 3,767.3

9.3
16.7

AOT

BUY

330.0

30.5

30.8

25.9

3.9

15.7

1.5

BLA

BUY

67.0

65.3

66.7

19.1

2.8

14.8

2.2

14.0

12.9

CENTEL

BUY

40.0

56.4

56.4

26.2

3.7

15.8

1.5

CK

BUY

32.8

-2.5

-3.8

20.2

2.2

11.3

2.0

CPN

BUY

57.0

14.0

13.4

24.1

4.3

19.1

1.6

KBANK

BUY

244.0

7.5

6.1

9.5

1.5

18.1

1.9

LPN

BUY

22.0

31.3

31.3

10.1

2.3

23.8

4.9

SCC

BUY

590.0

22.6

14.2

15.1

3.1

21.8

2.6

Note: Closing prices as of June 19, 2015

Track recordsince inception

275
255
235
215
195
175
155
135
115
95
75

Model
Port
SET

Old portfolio
Wgt
%

04/15

12/14

09/14

06/14

02/14

11/13

08/13

04/13

01/13

10/12

SET50

07/12

Risks: 1) Worsening economic and financial data flows from the US,
the European Union and Asia, 2) greater risk aversion among
investors, leading to a market de-rating, 3) the interim government
proves to be incompetent, 4) a weaker-than-expected domestic
economy.

PER PBV

270.0

03/12

Removed: SIRI, BTS

Core

(%) EPS (%)

ADVANC BUY

12/11

Added: AOT (strong growth in tourist arrivals), CENTEL (strong growth

in tourist arrivals, highest growth in RevPar compared to its peers)

BUY

09/11

News of the first MERS case in Thailand hit tourism stocks late last
week. Prices dipped to the tune of about 10% for hotels and airports,
swiftly reflecting the risk of an impact on tourist arrivals in the short
term. A well-controlled situation could make the recent price declines a
good entry point for tourism-related stocks. However, new cases of
MERS could otherwise cause share prices to continue their slide.
Learning from the most comparable situation, the SARS pandemic of
2003, we believe that any impacts on share price will be short-lived. We
therefore add tourism stocks to our model portfolio.

EPS
15E

AAV

05/11

Our model portfolio has delivered a return of +1.2% since our last our
report (May 18), and outperformed the SET by 2.5%. On a YTD basis,
the collection of stocks delivered a return of 1.2% versus the SET
indexs return of -0.4%.

TP
(Bt)

New portfolio

Price (Bt)
Return
%
18/5/15 19/6/15

Wgt Prc (Bt)

% 19/6/15

AAV
ADVANC
BLA

7
14
8

4.76
237
45.62

4.22
231
49.25

-11.3
-2.5
8.0

AAV
ADVANC
AOT

7
14
10

4.22
231
290

BTS
CK
CPN
KBANK
LPN
SCC
SIRI

9
7
11
15
8
14
7

9.15
24.6
43.5
206
16.3
528
1.83

9.9
26.75
44.75
197
18.2
520
1.83

8.2
8.7
2.9
-4.4
11.7
-1.5
0.0

BLA
CENTEL
CK
CPN
KBANK
LPN
SCC

8
7
7
11
14
8
14

49.25
35
26.75
44.75
197
18.2
520

1,491.5
978.7

1.2
-1.3
-2.3

YTD return (%)

Portfolio
SET
SET50

1.2
-0.4
-2.2

Return since last report

Portfolio 100
SET
1,510.4
SET50
1,001.3

Source: Bualuang Research

Poramet Tongbua, CFA

Securities Fundamental Investment Analyst
poramet@bualuang.co.th
+66 2 618 1346
See disclaimer at the end of report

Figure 1 :

Stock picksfinancial summaries

Rec.

Price

TP

Upside

EPS gw t

(Bt)

(Bt)

(%)

15E

Core EPS

(%)
AAV

54.0 1,107

PER

(%)

16E

PBV

(x)

ROE

(x)

Div Yld

(%)

(%)

15E

16E

15E

16E

15E

16E

16E

15E

16E

16.3 3,767

16.3

9.3

8.0

0.7

0.6 10.7 11.2

0.0

0.0 1.12

6.4 16.7 15.3 14.6 14.6 87.8 95.7

6.0

6.5 0.98

BUY

4.2

6.5

ADVANCBUY

231.0

270.0

16.9

14.0

9.2

12.9

AOT

BUY

290.0

330.0

13.8

30.5

12.0

30.8

13.7 25.9 23.2

BLA

BUY

49.3

67.0

36.0

65.3

13.6

CENTEL BUY

35.0

40.0

14.3

56.4

CK

BUY

26.8

32.8

22.4

CPN

BUY

44.8

57.0

27.4

14.0

KBANK BUY

197.0

244.0

23.9

15E

beta

3.9

3.5 15.7 16.0

1.5

1.7 0.99

66.7

13.7 19.1 16.8

2.8

2.6 14.8 15.3

2.2

2.4 0.97

20.1

56.4

20.1 26.2 21.8

3.7

3.3 15.8 17.2

1.5

1.8 1.12

-2.5 -14.9

-3.8

59.0 20.2 23.8

2.2

2.1 11.3

9.1

2.0

1.7 1.39

24.9

13.4

26.9 24.1 19.3

4.3

3.7 19.1 20.8

1.6

2.1 1.14

7.5

12.9

6.1

10.3

9.5

8.4

1.5

1.3 18.1 17.8

1.9

2.0 1.08

LPN

BUY

18.2

22.0

20.9

31.3

17.8

31.3

17.8 10.1

8.6

2.3

2.0 23.8 24.5

4.9

5.8 1.09

SCC

BUY

520.0

590.0

13.5

22.6

10.3

14.2

13.1 15.1 13.7

3.1

2.8 21.8 21.4

2.6

3.1 1.02

Sources: Company data, Bualuang Research estimates

Figure 2 :

Model portfolios performance, YTD

109
107
105
103
101
99
97

Model port

Change portfolio

SET

6/15

6/15

5/15

5/15

5/15

4/15

4/15

4/15

3/15

3/15

3/15

3/15

2/15

2/15

2/15

1/15

1/15

1/15

1/15

95

SET50

Performance of model portfolio relative to SET

104
102
100
98

06/15

06/15

05/15

05/15

05/15

04/15

04/15

04/15

03/15

03/15

03/15

03/15

02/15

02/15

02/15

01/15

01/15

01/15

01/15

96

Sources: SET, Company data, Bualuang Research

Model portfolio - 2

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Description

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Very Good

70 79

Good

60 69

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BUALUANG RESEARCH RECOMMENDATION FRAMEWORK

STOCK RECOMMENDATIONS

SECTOR RECOMMENDATIONS

BUY: Expected positive total returns of 15% or more over the next 12
months.
HOLD: Expected total returns of between -15% and +15% over the next 12
months.
SELL: Expected negative total returns of 15% or more over the next 12
months.
TRADING BUY: Expected positive total returns of 15% or more over the next
3 months.

OVERWEIGHT: The industry, as defined by the analyst's coverage universe, is

expected to outperform the relevant primary market index over the next 12 months.
NEUTRAL: The industry, as defined by the analyst's coverage universe, is
expected to perform in line with the relevant primary market index over the next 12
months.
UNDERWEIGHT: The industry, as defined by the analyst's coverage universe, is
expected to underperform the relevant primary market index over the next 12
months.

Model portfolio - 3