STOCKS NEWS THAILAND-Macquarie downgrades Bangkok Bank; KTB, Kbank top picks

Fri Feb 15, 2013 2:10am EST

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Macquarie Equities Research downgraded Bangkok Bank Pcl to 'neutral' from 'outperform', citing limited share price upside and cutting 2013-14 earnings forecast for the bank, in part reflecting lower net interest margins.

While Bangkok Bank continues to provide strong downside risk protection due to high loan loss reserves and capital ratio perspectives, its core operation has lost steam and earnings could disappoint due to funding costs and weak fee income growth, the research house said in a report on Thai banks dated Feb. 14.

Its stock target price was 230 baht. Bangkok Bank shares were down 0.9 percent at 212 baht at the midsession break versus a 0.03 percent gain of the banking subindex.

The broker reiterated its 'overweight' rating on Thai banks and raised 2013-14 forecasts by 0.5-4 percent with a three-year earnings compounded annual growth rate of 14 percent. It kept its 'outperform' rating on Krung Thai Bank and Kasikornbank.

"Of the large banks, our two favourites remain KTB and KBANK, but places are switched, with KTB now the outright favourite based on its low valuations and growth prospects," it said.

Krung Thai shares were up 1 percent at 25.75 baht, versus the broker's target price of 24.9 baht. Kasikornbank shares were up 0.5 percent at 204 baht, hitting the broker's target price of 204 baht.

1345 (0645 GMT)

(Reporting by Viparat Jantraprap in Bangkok; Editing by Prateek Chatterjee)

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13:17 STOCKS NEWS THAILAND-Thai Airways outperform; seen laggard

Shares in Thai Airways International Pcl THAI.BK hit their highest in nine months in strong trading volume amid optimism about the tourism industry and earnings outlook of the national carrier.

Broker Kasikorn Securities advised investors to buy Thai Airways, saying the stock was laggard.

At the midday break of 0530 GMT, Thai Airways shares were up 2.9 percent at 24.5 baht, climbing at one point to 24.7 baht, the highest since May 15, 2012. About 36 million shares have changed hands, 4.5 times a full-day average of the past 30 sessions.

Thai Airways shares had risen 11 percent so far this year versus Airports of Thailand's Pcl AOT.BK year-to-date gain of 20 percent and Asia Aviation's Pcl AAV.BK year-to-date gain of 42 percent.

1306 (0606 GMT)

(Reporting by Viparat Jantraprap in Bangkok; Editing by G.Ram Mohan)

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