STOCKS NEWS THAILAND-Thai Airways shares underperform on higher costs

Mon Feb 18, 2013 12:41am EST

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Shares in Thai Airways International Pcl fell as much as 1.8 percent to 24.8 baht, underperforming aviation shares, after management outlook of higher costs involving staff compensation for the quarter ended December.

The management told an analyst meeting on Friday it would record over 1.3 billion baht ($43.5 million) in staff compensation for the quarter, mainly due to labour union settlement, Maybank Kim Eng Securities said in a report.

Its previous outlook was for 500 million baht.

"The impact from negotiations with the Labour Union will likely hurt Thai Airways Q4 normalised profit significantly. However, we still believe Thai Airways will post a 2012 net profit of 5.2 billion baht, a turnaround from a 10 billion baht loss in 2011," it said.

Shares in Airports of Thailand Pcl were up 1.7 percent at 119 baht, while Asia Aviation Pcl rose 0.7 percent to 6.9 baht.

1224 (0524 GMT)

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

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11:06 STOCKS NEWS THAILAND-Nomura cuts Advanced Info Service price target

Nomura Equity Research cut its price target on Advanced Info Service Pcl (AIS) ADVA.BK, Thailand's largest mobile phone operator, to 260 baht from 269 baht, reflecting uncertainties during the 3G rollout.

AIS shares were up 0.5 percent at 201 baht, with a year-to-date loss of 3.5 percent versus second-ranked Total Access Communication's DTAC.BK year-to-date loss of 1.7 percent and True Corporation's TRUE.BK year-to-date gain of 20.2 percent.

The broker said AIS' recent capex outlook of 70 billion baht ($2.34 billion) was higher than its earlier forecast and consensus forecasts.

"Despite current concerns on licensing and network structure in the 2G concession structure, we expect far more clarity in the coming 12-18 months as 3G customer take-up picks up and legacy agreements are resolved," the broker said in a note dated Feb. 18.

The broker reiterated its 'buy' rating.

"We are cognizant of the capex/competition/dividend risks, but still believe AIS is well positioned to navigate through this phase," it said.

1054 (0354 GMT)

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

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