Have you ever wondered how you can take a position in some of the Top Thailand companies listed on the SET, without the hassle and additional cost of buying the stocks directly there?
Since end of May 2023, it is now possible.
We can take a position in some of the Top Thailand companies like any other stocks listed on the Singapore Exchange.
We can buy what is called Singapore Depository Receipts, in short, SDRs.
SDRs are instruments representing beneficial interest in an underlying security listed on an overseas exchange and are issued for trading on the securities market of the Singapore Exchange by an intermediary, SDR Issuer, on an unsponsored basis.
It will enable SGX investors to expand investment horizons to overseas listed companies in a simple and cost-efficient manner.
So, with the launch of Thai Underlying SDR as at end May 2023, traders and investors in Singapore can now invest in such Thai companies just like any Singapore stocks listed on the SGX with the same settlement procedures and SGD traded currency.
There are 3 blue chips Thai underlying SDRs currently which is what I will be talking about in this article and how you can potentially profit from.
I will be analyzing the charts of these 3 underlying Thailand stocks before sharing how one can take a position on the SDRs listed on the SGX and the potential target price based on current price levels.
The 3 underlying Thai stocks listed in the SET and their codes are:
| Underlying Thai stocks on SET | Thai SDR on SGX |
Airports of Thailand | AOT.BK | TATD |
PTT Exploration & Production | PTTEP.BK | TPED |
CP All | CPALL.BK | TCPD |
1) Airports of Thailand (AOT.BK) manages and operates airports in Thailand and is a top Blue chip on SET with the highest weightage of 8% as Thailand is focused on Tourism.
We have broken the 65 (S$2.47) support last month and more selling returned for AOT.BK. This support has been holding since Mar 2022, for more than a year and a half, so a break down below this support can signal more weakness unfortunately.
There are still signs of the short-term trend pointing down as seen from the downward sloping 20-day moving average. Longer term trend seems to be pointing down as well for now.
Over the past week, the 60 (S$2.28) psychological support has not held so likely more downside can occur towards supports we have seen in 2020 and 2021 which are from 50 (S$1.90) to 55 (S$2.10).
Those are indeed attractive levels where one can consider accumulating on dips, but only when the short-term trend reverses. That would be when the 20-day moving average line cease pointing down and at least start to flatten out near these key supports.
So how does one take a position in Airport of Thailand from the SDR listed on the SGX?
Well, you can take a position in this SDR, which is named AIRPORTS OF TH TH SDR (TATD), currently priced at S$2.22.
As mentioned, this SDR is like a normal Singapore stock where its traded currency is in SGD and settlement procedures the same.
For an entry near S$1.90 support, potential upside of about 30% if we rebound back to levels like the 65 (S$2.47).
2) PTT Exploration & Production (PTTEP.BK) is a leading oil and gas exploration and production company in Thailand and is a top Blue chip on SET with the top 10 weightage.
PTTEP.BK currently trading at 148 (S$5.62) has broken the support at 150 (S$5.70) – 155 (S$5.89) that we have been holding for more than 4 months since July this year.
This weakness is also in line with oil prices further selling down over the past month.
With this break of support, more downside is possible towards 135 (S$5.13) – 140 (S$5.32) which are levels we have rebounded in Mar and Jun this year.
One can consider timing entry on any dips near 135 (S$5.13) for a potential rebound back to 155 (S$5.89).
Can also consider having a stop loss level at around 127 (S$4.82) to get out in case the 135 (S$5.13) support gives way to cap any losses to a minimum.
So how does one take a position in PTT Exploration & Production from the SDR listed on the SGX?
Well, you can take a position in this SDR, which is named PTTEP TH SDR (TPED), currently priced at S$5.62.
For an entry near 135 (S$5.13) to ride to 155 (S$5.89), we are looking at a 13.40% potential upside as per targets.
3) CP ALL (CPALL.BK) Operates the 7-Eleven convenience store chain in Thailand and has the most extensive convenience store network in the country.
Since breaking the 60 (S$2.28) psychological support level 2 months back on market weakness, we have seen more selling in CPALL. It has traded lower and currently at 53.25 (S$2.02) where the short-term trend may still be down.
We are approaching this key support at 50 (S$1.90) - 52 (S$1.97) that has been holding since 2016 and also where we staged an incredible rebound to 74 (S$2.81) in Oct last year. Some bullish reversal candles are starting to appear as we near this support which can point to some bargain hunting coming back finally.
When the short-term trend reverses, one can consider an entry to ride it back to 60 (S$2.28) which would now be the near-term target.
One can look at the 20-day moving average to see it flattens out at least which can show a potential reversal. Currently, that is still pointing down so would want to be patient to time entry only when the trend reverses.
So how does one take a position in CP ALL from the SDR listed on the SGX?
Well, you can take a position in this SDR, which is named CP ALL TH SDR (TCPD) currently priced at S$2.02.
For an entry near the 50 (S$1.90) support, we are looking at a 20% potential upside as per targets to S$2.28.
Footnote: Currency conversion used from THB to SGD is 0.038.
