Obscure equities to provide data

Forty equities outside of research coverage by securities companies have been selected to provide investment information for investors, says the Investment Analysts Association (IAA).

The Securities and Exchange Commission (SEC) and the Stock Exchange of Thailand (SET) have cooperated to support the IAA in producing stock research for securities not covered by securities companies.

The move aims to provide information on interesting mid- and small-cap stocks that are out of analysts’ coverage, helping investors learn more about them, said Sombat Narawuthichai, secretary-general and director of the IAA.

There are more than 700 firms listed on both the SET and the Market for Alternative Investment, but research coverage by securities companies covers only about 150 securities.

It is difficult to find investment information on the remaining securities because they are small- and midcap companies.

Under the SEC and SET conditions, the IAA has to select securities analysts and securities companies that meet the analysis standards and choose targeted stocks, with the initial amount capped at 40 securities for this year, Mr Sombat said.

The objective is to gradually increase stocks with research coverage to 70 in 2020 and 100 in 2021, he said.

Research on targeted securities under the project must produce business outlook, fundamentals and key financial ratios such as earnings per share, revenue structure and other important investment data.

Business risks and share evaluation are based on the price-to-earnings ratio or discounted cash flow.

The IAA plans to ask the Capital Market Development Fund to provide funding support for securities research in the future, as the project will yield benefits in terms of both stock market development and investors, Mr Sombat said.