Kiatnakin Phatra Securities has revised down its earnings outlook for Thailand’s retail sector, following the declaration of a one-year mourning period for the passing of Her Majesty Queen Sirikit, the Queen Mother, who passed away on 24 October 2025. The firm expects this mourning period to weigh on consumer sentiment and discretionary spending, particularly in leisure and entertainment segments.
Under government directives, state officials and the Royal Household Bureau will hold a year of mourning, with national flags at half-mast for 30 days. Entertainment venues are also being asked to tone down activities during this time. In response, Kiatnakin Phatra lowered its earnings estimates for retailers under its coverage by 3-9%, reflecting a more subdued same-store sales (SSS) outlook. The biggest adjustment was made to CPAXT, which already faced weaker-than-expected SSS year-to-date.
Additionally, the brokerage raised the risk-free rate assumption for CPALL and CPAXT from 3% to 4%, aligning with its house view. This adjustment resulted in target price cuts for the two retailers by as much as 16%. Kiatnakin Phatra foresees short-term share price weakness in the sector but considers this a buying opportunity, naming Central Pattana Plc (CPN) as its top pick.
The report draws parallels with the national mourning period in 2016 for King Bhumibol Adulyadej, which resulted in a sharp slowdown in consumer spending for both non-durable and semi-durable goods. Retailers experienced a drop in SSS from 2.2% in Q3 2016 to -0.4% in Q4 2016 as a result of postponed events, nightlife closures, and softer tourist arrivals. The brokerage firm added that the slowdown lasted a few quarters before recovering in the second half of 2017.
In the current context, retailers like Central Retail Corporation (SET: CRC) and Home Product Center (SET: HMPRO) have had their income ratings revised, as lower dividends are expected over the coming year. Meanwhile, CPN forecasts only a one-month delay in its scheduled events, though it still anticipates year-on-year growth in foot traffic.
Despite near-term headwinds, Kiatnakin Phatra maintains a cautiously optimistic longer-term view, urging investors to monitor the sector for potential opportunities as consumer activity stabilizes after the mourning period.
