Equity Analysis /

Thailand: Tech -Don’t wait for the storm to pass, but learn to dance in the rain

  • A lot of trees have been felled…

  • … and it's time to plant saplings for the next rebound

  • Headwinds can’t topple trees with strong roots

Napon Jaisan
Napon Jaisan

Equity Research Analyst

Bualuang Securities
7 October 2022

After we launched our Jul 15 report to point out an attractive risk/reward proposition for tech stocks, their stock prices rebounded. Tech names have been mauled again by a bear market in the recent weeks, perhaps offering a new opportunity to catch the next rebound?

A lot of trees have been felled…

Their recent performance might suggest that tech’s time in the sun has come and gone, but we do not think that is the case. Instead, we believe tech’s recent volatility has been the result of valuation adjustments as equity markets recalibrate for an era of higher interest rates and lower growth. After our report of Jul 15, Thai tech stocks rebounded by 47% on average, led by BBIK, DITTO, BE8 and IIG. BBIK and BE8 set their new record highs. During the past two weeks, tech stocks have been hit by the bear market again. Aggregate Thai tech stocks were sold down by 21% on average from their latest highs, led south by SABUY (XW), HUMAN, and BOL. But leaders for the recent rebound seem to have held up well.