Foreign tourist arrivals in Thailand surged more than 2,100 percent year over year to 444,039 in 1Q22, with generated revenue of THB34,173 million, up 1,424 percent from a year earlier, according to the Tourism Authority of Thailand.
With these figures, the tourism agency forecasts that between April and June, 341,340 foreign travelers would enter Thailand, a 1,584 percent increase over the same period in 2021, contributing approximately 23,083 million baht in tourism revenue.
The factors contributing to an increase in international visitors are the relaxation of travel restrictions, such notably the removal of the requirement for a negative COVID-19 RT-PCR test result since April 1st.
Furthermore, Thailand is planning to scrap mandatory RT-PCR tests on arrival for inbound travelers from May onwards in an attempt to step up efforts to bring back tourists.
KGI Securities (Thailand) maintained “Overweight” rating on Thailand’s hotel sector, as tourism sentiment is poised to see a rebound from 2Q22 onwards given more progress on COVID-19 vaccine booster shots and loosened travel restrictions. Top Picks are S Hotels and Resorts Plc. (SET: SHR) (TP: THB4.80/share) and Minor International Plc. (SET: MINT) (TP: THB39.00/share), as both companies are expected to show strong growth momentum YoY backed by the performances of hotels outside Thailand.
KGI expects tourism stocks under its coverage to report a combined 1Q22 normalized loss of THB2.7 billion, improving 60 percent YoY, but decreasing from a 4Q21 normalized profit of THB1.4 billion. The strong broad-based recovery YoY is expected to be backed by improving hotel performances across destinations, while the drop QoQ is expected to be pressured by the emergence of the Omicron variant and hotels in Europe entering the low season.
In addition, KGI foresees meaningful signs of recovery for Thailand’s tourism industry to come from 2Q22 onwards amid the expected improving COVID-19 situation and continued positive news coming in.