SET bear market on-going in good part due to lack of broker/exchange reforms.

PaulRen's picture

Well now we got the “fine mess” -as Laurel & Hardy would say.  Memory lane during very hard Thai stock investor times over the past decade.

For years up until recently I often at this site wrote for members and others how the Thai SET and its brokers could do/be much better then just chasing volume and trading. 

More then once I stated how “bad money will chase out good.”   At times sending letters to the BKK-Post expressing this, but chosen by them not to publish.  Presently we see how this has been happening, all year long and well before the latest international dire headlines.   Foreign institutional funds have been flowing out by the billions month after month and yet few are asking why. Except for pointing the index finger at foreign events, while this leaves 3 fingers pointing back.  I will spare the reader here in giving all the dire numbers as they are regularly published elsewhere. 

Having followed full-time Thai stocks for over 3 decades, at times on a cloudy day here, I peruse many graphs of many dozens of companies and more I used to follow/visit -and then some.  Soo many if not most, and its appalling in this never being reported anywhere, are trading at 10 year lows -or worse.  The SET's overall wealth-destruction during the past 10 years is outright appalling if not galling and far worse then even the lethargic SET benchmark index (1397) reveals; itself just now at a 10 year low….as a decade ago it was trading above 1400.  For years here warnings were ignored that pursuing their ill-perceived mantra of high volume and trading would only result in poor long term investor returns -and devastate the local bourse in time.   Et voila.

Presently the exchange is considering extending its trading hours by 30 minutes believing this would enhance trading volume, this is the thinking... vs. debating how one could enhance the local stock exchange to higher investor appeal to so far more people whom desperately are seeking good investments; not day trading-galore!  Vs. lousy Bank saving account interest.  Its been estimated barely 3-4% of the total Thai population partake in the local bourse -and this has been sadly so stagnant at best, for many years.  If the exchange and its brokers appealed more to investors (by far the majority of us), it could vastly expand its reach.  Alas, it is not and nothing points on the horizon that this will change, except just maybe for the continued bad SET bear market, ongoing.   But I am not holding my breath.   Over the long and recent past, I often here expressed dismay and head shaking disappointment in their practices not only in not getting better over time,  but too often worse.  Just a few short months ago I outright here said that if there were no meaningful reforms forthcoming, I would resign from what I do.  I won’t here dwell on all that again, as my time on this has passed. Sad.

Yet, there is a silver lining to investors whom followed me.  As I often here expressed it’s by far a market of stocks more than a stock market here and one does not have to jump on the wagon around local bourse/broker practices.  Beat them, while not joining them is my motto.  

While I have been wrong on various other selections over recent years (yes, its been a horrific bear market):  if you take a close look at my web-site and searched AUCT and TOG, you will see I wrote far more about these 2 highly touted stock selections, yes by far, than any other and this by a long shot!  Continuously pounding the table on both all along and with ample solid research to back it up on why.  Over the past 2 years, lets say since end of Covit, TOG (10.90), adding the high & growing dividends all along doubled in mkt. price….and Union Auction (AUCT) also did very well since, while immensely now on-going benefiting from mega car repossessions: Auctioneers do well during hard times!  See just below my last member-forum posting just last week below, as research published by broker Globex* .   On  Thai Optical Group, (TOG), my latest 2 member-only articles are now also free to see to registered free users.   BTW, both pay double the SET average in current dividend yields on present (now higher) mkt. prices. 

Despite such superior investor performance here on those 2 by far favored, and despite the horrific SET sell-off and bearish market this year on top of previous poor years, both AUCT/TOG are still undervalued in my view! 

Best Regards,

Paul A. Renaud.


 *  AUCT (9.90) should report record profit and them some by mid November '23.  Strong buy view here acclaimed, with just now mkt. price below 10!  Expect Q.3  to report around 97 mill. Baht net profit which is 45% YoY,  and 48% QoQ!  Estimate for all of 2023 is for AUCT to earn 365 mill.,  or +45% as compared to the previous year.  For year 2022, AUCT earned 251 mill Baht.  Hence their dividend might be increased similarly by 40%?,  or say from 4.5% currently at current mkt price to 6.4%.  Wow.  Much benefiting from Thai consumer overstretch and so on going massive Car/motorbike auctioning.    Member forum Posted by: PaulRen on 20 Oct 2023 - 12:32pm