Shares in Tisco Financial Group Pcl fell to their lowest in almost one month amid concerns about the possible impact of weak capital base on growth outlook and dividend payout.
At the midsession break of 0530 GMT, Tisco shares dropped 5.6 percent to 50.5 baht, having hit 50 baht, the lowest since Dec. 18. It has fallen 2.9 percent so far in 2013 versus a 1 percent gain of the banking subindex.
"TISCO Tier-1 was 9.0 percent at the end of 2012 and this has continued falling from 12.5 percent in 2009 due mainly to rapid loan expansion over 20 percent in the past few years," Broker Maybank Kim Eng Securities said in a report.
In a research note, Nomura Securities said it downgraded the stock rating to 'reduce', citing weak profit growth outlook after Tisco posted a 14 percent increase in 2012 profits despite a 35 percent increase in loans.
"Strong loan growth means provisions stay relatively high. Against this backdrop, we believe its profit growth is likely to slow from an 88 percent increase in 2009-12 to just 10 percent in 2012-15F," it said.
The broker maintained its stock target price of 40 baht.
(Reporting by Viparat Jantraprap in Bangkok; Editing by G.Ram Mohan)
12:03 STOCKS NEWS THAILAND-PTTEP at one-week low; weak Q4 earnings seen
Shares in PTT Exploration and Production Pcl PTTE.BK hit a one-week low, underperforming the energy sector and the broader stock market, amid expectations of weak fourth quarter earnings due to expenses on its Montara project in Australia.
PTTEP shares were down 0.9 percent at 166 baht, falling at one point to 165.5 baht, the lowest since Jan. 8. The energy subindex .SETEN was up 0.16 percent, while the benchmark SET index .SETI was 0.24 percent higher.
Broker Phillip Securities forecast quarterly net profit of 14.2 billion baht ($469.7 million), down from 17.5 billion baht in the third quarter. PTTEP is expected to release its fourth quarter and 2012 earnings next week.
The Montara field is expected to resume production in March and PTTEP is likely to write off asset impairment worth $100 million in the fourth quarter on a slower-than-expected start of production, the broker said in a report.
"PTTEP would book $30 million insurance claim for the Montara field. In sum, PTTEP is expected to book total extra losses of 2.1 billion baht, which would drag net profit lower to 14.17 billion baht in the fourth quarter," it said.
(Reporting by Viparat Jantraprap in Bangkok; Editing by Prateek Chatterjee)
$1 = 30.23 baht