Referencing the U.S. Supreme Court unresolved rulings on President Donald Trump’s Reciprocal Tariffs measures, enacted through an executive order under the International Emergency Economic Powers Act (IEEPA) of 1977. If the Supreme Court declares that such tariffs are unlawful, the U.S. government may be obliged to refund up to $150 billion in tariffs, potentially posing a severe risk to economic stability.
The legislation was designed for use during a national emergency. Trump declared a state of emergency to impose two primary types of tariffs: 1) Reciprocal Tariffs, levied at 10-50% on nearly all trading partners that impose higher tariffs on U.S. goods; 2) Fentanyl Tariffs, levied at 25% on products from China, Mexico, and Canada to address illicit drug imports. Currently, Thailand faces a 19% tariff.
Asia Plus Securities stated that if the U.S. Supreme Court decides to repeal the Reciprocal Tariffs, it could lead to significant tax refunds for previously collected amounts. Many companies have begun legal proceedings to claim such refunds.
Bloomberg estimates that the industries most affected by President Trump’s import tariffs fall into two main groups:
Importers of final goods for U.S. consumers, such as garments, textiles, miscellaneous goods (e.g., toys and sporting equipment), and food and beverage.
Importers of intermediate inputs, such as machinery, electronics, automotive, and construction equipment (including electrical equipment, appliances, and building materials for new construction).
From an investment strategy perspective, Asia Plus recommends speculation in stocks that were previously impacted by these tariffs and could regain prominence if the tariffs are repealed.
These include exporters such as Delta Electronics (Thailand) Public Company Limited (SET: DELTA), KCE Electronics Public Company Limited (SET: KCE), Hana Microelectronics Public Company Limited (SET: HANA), Cal-Comp Electronics (Thailand) Public Company Limited (SET: CCET), Charoen Pokphand Foods Public Company Limited (SET: CPF), Thai Union Group Public Company Limited (SET: TU) (with 40% of revenue from the U.S.), i-Tail Corporation Public Company Limited (SET: ITC), and Thai Coconut Public Company Limited (SET: COCOCO).
Notably, Thai export tariffs to the U.S. are higher than regional competitors—Vietnam at 20%, Malaysia at 25%—impacting Thai production and export costs to the U.S. and reducing investment appeal in Thailand (notably affecting industrial estates). Should Trump’s tariffs be lifted, stocks such as WHA Corporation Public Company Limited (SET: WHA) and Amata Corporation Public Company Limited (SET: AMATA) may recover.
Furthermore, if the tariffs are removed, this would positively affect U.S. inflation, possibly accelerating reduction to the target range of approximately 2%. This outcome could impact the Federal Reserve’s (Fed) monetary policy, potentially allowing more substantial rate cuts than previously anticipated.
Bualuang Securities assessed that if the U.S. Supreme Court ruled the measures unlawful, this will alleviate policy concerns and support positive sentiment for the electronics sector in the short term.
Currently, Thai electronics companies are highly reliant on the U.S. market: DELTA earns about 35% of its revenue from the U.S.; KCE, about 20-25%; and HANA, about 10-15% directly and around 30% indirectly. However, management at all companies agreed that the cost of tariffs has already been passed on to customers, meaning the repeal would not immediately generate upside to profits, so the profit impact from the court’s ruling is limited.
The market is placing more weight on supply chain risks. Previously, Bualuang estimated the tax burden would be distributed throughout the value chain, from OEM producers and raw material suppliers to end consumers. Over time, though, there is risk that tariffs are pushed back onto suppliers through renegotiated lower prices, especially for weak-demand products, or passed on to consumers, dampening demand and requiring producers to be cautious in production planning.
If the court repeals the tariffs, such risks would diminish and support positive sentiment in the electronics group, with sensitivity ranked HANA-KCE-DELTA. DELTA is less affected by the tariffs thanks to growth drivers in structurally strong sectors such as AI and data centers, which are less sensitive to demand shifts.
However, Bualuang cautions that not every U.S. tariff is tied to IEEPA, e.g., the 15% tariff on European Union cars results from a bilateral agreement between the U.S. and the EU and remains in force regardless of an IEEPA-based tariff repeal.
Historically, as tax-related uncertainty eases, electronics stocks tend to revert to their normal valuation levels. In mid-2024, these stocks rebounded from around -1 standard deviation (SD) to average or above. Currently, however, most stocks (except DELTA) are trading close to -1 SD, mainly due to inconsistent demand recovery rather than tax risks.
The current rally is seen as a short-term speculative play, with stock prices expected to recover to about -0.75 SD; strategic price ranges are THB 19 for HANA and THB 20 for KCE. DELTA is expected to consolidate around THB 160 and could rise to THB 180 if market sentiment is favorable. No V-shaped recovery is anticipated, with a clear re-rating likely after 1Q26.
Should the Reciprocal Tariffs be repealed while China-specific measures remain, this could accelerate the long-term shift of orders out of China, favoring KCE, as Chinese PCB producers account for about 70% of global capacity. In the short term, though, weaker Chinese producers may engage in price cutting in other export markets, which would limit upside for share prices.
For DELTA, this scenario could encourage order switches from Taiwan, strengthening long-term structural advantages. HANA’s main competitors already have diversified manufacturing bases, so their structural advantage remains largely unchanged.
Bualuang notes that, although a Supreme Court decision would reduce existing uncertainty, the U.S. retains other legal tools—such as Section 232 or targeted measures—that could be reimposed, meaning the industry may still face order delays pending policy clarity. This remains a risk for investors to monitor closely.
