STOCKS NEWS THAILAND-Maybank Kim Eng upgrades Siam Commercial Bank to buy
Maybank Kim Eng Securities upgraded its rating on Siam Commercial Bank Pcl to 'buy' from 'buy on weakness', saying a capital increase of Sahaviriya Steel Industries Pcl eased concerns over its loan repayment ability to the bank.
The broker set its stock target price at 190 baht. Siam Commercial Bank shares were up 0.3 percent at 154.5 baht versus a 0.06 percent fall of the banking subindex. The main SET index edged up 0.34 percent.
Maybank Kim Eng said Siam's involvement in the recent capital-raising program by Sahaviriya Steel will be positive for the bank.
Last week, Sahaviriya unveiled a capital raising plan to repay short-term debt and raising funds for its British unit SSI UK.
"This deal will be positive for Krung Thai Bank, Siam Commercial Bank and TISCO, who have provided syndicated loans to SSI, as the interest burden and debt-to-equity ratio for SSI will decline," the broker said in a report.
"This leads us to be more confident that these banks will have no need to set aside extra provisioning for SSI loans. Of the three banks, the SCB stand looks best with the high excess reserve and low exposure to the capital base."
1540 (0840 GMT) (Reporting by Viparat Jantraprap in Bangkok; firstname.lastname@example.org)
11:32 STOCKS NEWS THAILAND-Phillip downgrades auto parts; buoyant data priced in
Phillip Securities downgraded its rating on shares of auto parts companies to 'neutral' from 'overweight', citing the sector's rich valuations recently boosted by strong auto sales numbers.
The auto parts subindex .SETAU edged up 0.03 percent. The sector was up 42 percent so far in 2012, outpacing a 19 percent gain of the broader SET index .SETI.
The sector index rose to a seven-year high on Friday after data showed that car and truck sales hit record high in July. (Full Story)
Auto parts firms posted higher earnings for April-June quarter along with a recovery of the automotive industry hit by the floods in late 2011 and due to launches of new eco car models, outweighing higher wage costs in the quarter.
"Although rising production volume during the remaining parts of this year will enhance companies' earnings, we perceive the news have already been reflected in their share prices," the broker said in a report.
Phillip said investors still can selectively buy into part suppliers such as AAPICO Hitech Pcl AH.BK which would benefit from production at Ford's new plant. It set price target for the stock at 20.4 baht. The stock was down 1.1 percent at 18.4 baht.
1131 (0431 GMT)
(Reporting by Viparat Jantraprap in Bangkok; email@example.com) ($1 = 31.525 baht)
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