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Aberdeen New Thai Investment Trust PLC

 

Objective

The objective of Aberdeen New Thai Investment Trust PLC is to provide shareholders with a high level of long-term, above-average capital growth through investment in Thailand.

Adithep Vanabriksha, Head of Thai Equities

Adithep Vanabriksha, Head of Thai Equities talks with Bloomberg's Susan Li about the impact of Thailand's political disputes on the nation's stock market.


What next for Thailand?


Manager's Monthly Report

August 2010


Market review

The SET index posted its highest monthly gain since December 2007 in July, supported by increased confidence in the economic outlook. Foreign inflows lifted the market, with net buying worth 6.88 billion baht. June economic data remained largely robust: exports surpassed expectations, rising 46% year-on-year, while imports increased 38%. Tourist arrivals rebounded by 13.7% from a year earlier to reach 7.5 million visitors during the first half. Meanwhile, consumer confidence strengthened for a second month in June. As a result, the Finance Ministry upgraded its full-year growth forecast to 5-6%. Although inflation remained subdued, the Bank of Thailand raised interest rates by 0.25-percentage points to 1.50%, its first rate hike in two years. Meanwhile, following May’s fatal protests in Bangkok, a superficial calm has returned to the country, with many provinces still under a state of emergency, and as the government continues to round up ‘red-shirt’ leaders under emergency detention legislation.

Portfolio Review

During the month, we took profits in Hana Microelectronics and Siam Makro following strong share price rises. We introduced property developer LPN Development instead, which focuses on mid to low-end housing, on the back of an attractive valuation and solid fundamentals.In general, our holdings reported robust second-quarter results: Siam Cement was aided by its paper business and volume growth from its new chemicals complex; PT Exploration and Production benefited from increased sales volume and prices, while Phatra Securities and Siam City Cement also saw improved earnings. Meanwhile, Kasikornbank, Siam Commercial Bank and TISCO Financial expect loan growth to meet full-year targets. In other news, Toyota Motor’s plan to invest up to four billion baht to expand capacity bodes well for parts suppliers Goodyear (Thailand) and Thai Stanley Electric.

Outlook

The rebound in exports combined with government spending across the economy has provided solid earnings growth. Recent political violence may have unsettled some foreign investors, but generally the country’s fundamentals appear strong, hence the central bank’s upward revision of growth forecasts. Notably, our holdings have posted very positive earnings growth, underlining their resilience. As such, we remain comfortable with their long-term prospects.


Source: Monthly Factsheet Aberdeen Asset Managers Limited

† Basis of calculation for Net Asset Value Beginning in mid-January 2007, the onshore and offshore currency rates for the Thai Baht diverged following the introduction of exchange controls in Thailand on 18 December 2006. With effect from 23 March 2007, this divergence had reached a material level such that the Trust opted to calculate and publish subsequent daily net asset values using the onshore Thai Baht rate to value Baht-denominated assets. This replaces the offshore rate used historically.