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STOCKS NEWS THAILAND-Sri Trang Agro rises on price recovery hopes
November 20, 2012 / 3:55 AM / 5 years ago

STOCKS NEWS THAILAND-Sri Trang Agro rises on price recovery hopes

Shares in Sri Trang Agro-Industry rose 1.33 percent to 15.20 baht as Phillip Securities said it expects earnings for Thailand’s biggest rubber producer and exporter to remain strong in the fourth quarter on recovering prices.

The broker rated the stock an ‘accumulate’ with a target price of 16.70 baht and said bottoming-out rubber prices and higher sales volume would boost earnings in the fourth quarter.

“Rubber prices appear to have already bottomed out. Global economic improvement could be a key catalyst for a recovery in rubber prices,” Phillip said in a note.

The broker said the agreement between the world’s top three rubber producers Thailand, Indonesia and Malaysia to cut exports by 10 percent as well as the Thai government’s intervention measures to shore up rubber prices, and weaker US dollar should help support prices.

“We expect fourth-quarter sales volume will be 15 percent higher than third-quarter on the back of strong demand from key client China, though recent sharp slump in rubber prices has prompted many clients to delay purchases in anticipation that rubber prices may fall further,” the broker said.

Phillip raised its 2012 earnings forecast for Sri Trang to 1.2 billion baht ($39.25 million).

1035 (0335 GMT)

For the company statement, click

(Reporting by Sinsiri Tiwutanond in Bangkok; Editing by Subhranshu Sahu; sinsiri.tiwutanond@thomsonreuters)

$1 = 30.73 Baht

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