We have upgraded our GLOBAL call from HOLD to BUY in anticipation of moderate earnings growth over the next few years. The stock is a proxy for upcountry demand and has an attractive valuation.
Solid upcountry economy will support GLOBAL
In addition to Thailand’s reopening, which is boosting overall consum-ption, we believe strong farm income, post-flooding demand for home renovation, and pre-general election spending will drive demand in the provinces, supporting GLOBAL. The firm is one of the biggest home construction retailers and all its stores are upcountry, so it should be a prime beneficiary of the provincial economic recovery. The close correlation between changes in farm income and GLOBAL’s SSSG appears to prove our point (Figure 2).