CLSA has revised its outlook for Thailand’s stock market, raising its SET Index target to 1,700 by the end of 2026, up from 1,620, and to 1,735 by the end of 2027, with market EPS forecasts for 2026/27 revised to 102.8/99.7. Despite concerns over persistently high global oil prices, the brokerage expects Thai inflation to remain within the Bank of Thailand’s 1-3% target range.
Notably, the marginal rise of 10 basis points in the two-year and five-year government bond yield spread since January 2026 indicates limited pressure on domestic financial conditions, according to the analyst.
CLSA remains optimistic about the SET Index, pointing to several catalysts including improving macroeconomic indicators, the Power Development Plan 2026 (PDP 2026), continued government stimulus to boost domestic consumption and tourism, and attractive yields on cyclical plays and banks.
A surge in data center investment is expected to benefit industrial estate developers, contractors, and utility providers. According to the NESDC, clear regulation could unlock over 117 pending or prospective projects within a month.
Year-to-date, Thai banks’ loan growth has reached 2.6%, close to the upper end of guidance, and a shift from short-term to long-term corporate loans is expected in the second half of 2026.
CLSA favors value, defensive, and banking sectors, citing energy for its low valuations and dividend yield, as well as its potential as an inflation hedge and beneficiary of AI data center growth. Among consumer stocks, grocery and staple retailers should outperform, given resilient same-store sales growth, while home improvement retailers may see softer trends.
Banks remain attractive for their strong capital ratios and healthy dividend yields of 5-7%. The brokerage names CPALL, CPN, DELTA, IVL, KBANK, PTTGC, SCB, and TOP as top picks. In particular, robust performance is highlighted in technology (DELTA), mall operators (CPN), recovering energy and petchem (IVL, PTTGC, TOP), and leading banks (KBANK, SCB).
