Mr. Gun Hathaisattha, Chief Investment Strategist and Economist of the Research Division at CGS International (CGSI) Securities (Thailand), stated in the “Kaohoon” program on August 25, 2026, that there are buying opportunities should the Thai benchmark drop below 1,600 points. This follows CGSI’s revised year-end 2026 SET Index target to 1,690 points, with the potential to test the 1,700-point level, reflecting an optimistic outlook for listed companies’ profit trends, which remain robust.
A key factor driving this view is stronger-than-expected 2Q26 earnings from listed companies, despite facing headwinds from persistent high oil prices and elevated costs. Notably, the energy sector—which carries significant weighting in the Thai market—stands to benefit from stable, high oil prices, benefiting both upstream, refinery, and petrochemical businesses such as PTTEP, PTT, BCP, and SPRC.
Meanwhile, the electronics sector remains positive, with HANA, KCE, and CCET posting solid earnings. Although DELTA’s Q2 results were below expectations, management signaled improving prospects in the second half as supply shortages begin to ease and sales gradually recover.
CGSI believes that if HANA, KCE, and CCET can sustain their momentum while DELTA rebounds—and with ongoing support from high oil prices in the energy sector—market EPS will be well-supported. Both energy and electronics are high-weighted within the SET Index, along with the banking sector, which continues to report strong earnings. Thus, no concerns are raised about the profitability outlook for listed companies this year.
In the technology and AI industries, demand remains high, evidenced by major overseas chip manufacturers’ order books extending into next year and, in some cases, up to two years. This underscores ongoing expansion cycles in AI and data centers, even though technology stock prices may face volatility due to lofty valuation levels and high U.S. bond yields.
Rising AI adoption and AI agent development are expected to fuel ongoing demand for computational power and data center infrastructure. As a result, major cloud and hyperscaler providers are likely to continue investing. Thai stocks with related businesses and growth opportunities in this trend include DELTA, CCET, and HANA.
Domestically, CGSI sees data centers as a significant new growth engine for the Thai economy. While this industry requires substantial equipment imports and has limited direct job creation, it is set to boost investment, support GDP expansion, and increase opportunities for advancement into future industries. Thailand needs to actively attract investment to maintain competitive advantages within ASEAN.
Regarding investment strategies when the Thai bourse dips around or below 1,600 points, CGSI recommends two approaches. The first involves selecting leading stocks that have corrected and still benefit from themes such as data center and dividend, covering sectors like industrial estates, power plants, telecommunications, and digital infrastructure—examples being WHA, AMATA, GULF, and ADVANC. However, only select stocks in each sector are recommended, given that many have already rallied significantly.
The second approach is to gradually accumulate laggard stocks, or those that have underperformed relative to the market—specifically CPALL and BDMS. Given this year’s strong SET performance, further index gains toward 1,650 – 1,700 points may require fund rotation into these underperforming stocks.
The banking sector continues to buttress market earnings; however, current valuations (trading at about 0.9 times P/BV compared to 0.4 – 0.6 times in the past) are less attractive than before. Thus, careful stock selection is now more crucial. CGSI highlights KBANK and SCB as fundamentally strong picks, while BBL and SCB are seen as laggards with softer price adjustments within the sector. Nevertheless, investors should factor in individual fundamentals and outlooks for each bank.
For mid and small-cap stocks, including finance and real estate groups, CGSI does not see this as a prime investment window. Recent Thai market rallies have been led by big caps, while the mai index has lagged, reflecting limited fund flows into mid and small caps.
Therefore, the near-term strategy should emphasize data center, dividend, energy, power, telecom, and industrial estate themes as core portfolio holdings, supplemented with laggards like CPALL and BDMS for sector rotation opportunities. Should the SET Index weaken below 1,600 points, CGSI views it as a further accumulation opportunity, with a year-end index target of 1,690 points.
