Thailand is facing a slow down in foreign tourist arrivals in the first five months of 2025, especially from declining Chinese tourists.
According to the data revealed by the Tourism Ministry on Tuesday, there were 13.9 million foreign arrivals to Thailand from January 1 to May 25, representing a drop by 2.55% from the same period a year earlier.
Meanwhile, Krungsri Securities had a negative view on the tourism sector in Thailand, stating that tourist arrivals for week May 19-25 were 0.46 million people, contracting over -22% YoY from Chinese and South Korean tourists continuing to contract heavily. Indian tourist arrivals 0.06 million people +21% YoY but unable to offset Chinese and South Korean tourist arrivals. Additionally, cumulative tourist arrivals of 13.9 million people decreased -3% YoY.
The firm also added that Chinese tourists are looking at different destinations other than Thailand as of late. During May 21-27, 2025, flight capacity on Chinese outbound routes +14% YoY slightly increased from previous week +13% YoY, still maintaining high growth on China-Japan routes +43% YoY and China-South Korea routes +31% YoY.
However, China-Thailand routes were -28% YoY, despite showing an improvement from previous week -33% YoY. This represents its 16th consecutive week in contraction.
KSS noted that it still expects 2025F tourist arrivals to remain flat YoY, maintaining Neutral weight on the aviation group and still select BA (Buy, TP 23.50) as a top pick stock for the group. This is contributed by positive factors on main flight routes (in-out Samui) having positive catalysts from The White Lotus series, target group (Europe) still growing, and small fleet size (25 aircraft) suitable for demand slowdown period. Additionally, there is a share buyback program (June 2-December 2, 2025) of no more than 64 million shares with a budget not exceeding 1,000 million baht (or average price of 15.60 baht/share).
