The Thai stock market is gearing up for what analysts anticipate will be next year’s "Dividend Season" starting from February to May 2025. This period is marked by investor focus on high dividend stocks due to their potential yields and the overall economic atmosphere.
According to analysts at Krungsri Securities, some stocks are well-positioned to offer significant returns through dividends. They highlight companies like Siam Cement Group (SCC) and SAWAD as prime candidates for investors interested in short-term yields. SCC, for its part, is projected to declare dividends at 2.5 THB per share. This amount translates to about 1.6% yield, which analysts suggest does not provide the best upside strategy due to the company facing high competition and potential profit declines.
Meanwhile, SAWAD is viewed more favorably, with analysts indicating positive developments concerning asset quality. The firm's profits are forecasted to grow by 10% year-on-year, supported by improvements such as increased insurance sales and decreased losses from seized vehicles, which have been problematic for the company previously. "There is potential for SAWAD to grow its net profit by 10% year-on-year and recently showed asset quality improvement," commented the analysts.
The banking sector is also highlighted as having significant opportunities for investors. The current yields from various banks are projected between 4-9%, making banks more attractive, especially as they are trading below their book values. These institutions are expected to maintain high dividend strategies which could bolster investor confidence as economic conditions fluctuate.
Further insights from SCB EIC shed light on the monetary policies impacting these stock performances. Recently, the Bank of Thailand cut interest rates by 0.25% to bring the policy rate to 2.0%. This move aims to stimulate the Thai economy amid persistent challenges. An economist from SCB EIC noted, "The current state of financial policy remains neutral, giving room for potential growth of the Thai economy." This suggests the Bank is accounting for the slower economic growth predicted for the upcoming period.
The overall sentiment within the market is carefully optimistic. With the approach of dividend payouts, investors are encouraged to take positions only on noticeable dividend-paying stocks, especially less than two weeks before the ex-dividend date. KSS, another analyst group, affirms this strategy by referencing historical data where high dividend stocks have performed positively during the early months of the calendar year.
Among the notable stocks expected to provide dividends are significant companies such as SCB and TISCO, both of which have shown consistent performance over time. Historical patterns suggest investing before dividend announcements can yield positive concrete returns, often referred to as "dividend capture" strategies.
A focused review highlights nine major companies predicted to offer noticeable dividends during this period, including names like the large-cap stocks SCB, TTB, and HMPRO, and mid-cap stocks like TISCO and JMT. Their consistent track records of yielding dividends offer comforting prospects to investors prioritizing income generation through their portfolios.
Overall, the anticipated dividend yields for these entities reflect broader economic indicators and highlight the strategic moves investors could make for 2025. "We expect to see SCC’s dividend at 2.5 THB per share, yielding around 1.6%," one analyst stated, emphasizing the necessity for investors to remain vigilant and adaptable.
Against the backdrop of these developments, potential headwinds loom over the Thai economy, with any shifts resulting from international trade policy changes likely affecting corporate profitability. Analysts suggest cautious engagement, monitoring for any changes within economic policy frameworks, particularly those imposed by the US trade policies affecting regional markets.
Forecasts show the importance of remaining informed as the market approaches dividend day announcements and potential opportunities arising from strategic stock selections. With the current data supporting yield expectations, now is the time for investors to assess their portfolios and strategize accordingly to maximize their returns during this pivotal phase of the investment calendar.