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ASEAN PROFILES ASEAN KEY DESTINATIONS ![]()
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Floods to impact Thai corporate earnings The floods in Thailand and the slowing global economy will likely trim earnings growth of Thai-listed companies to as low as 7 percent in 2012,a Thai securities firm and economists say. Also, economists expect gross domestic product (GDP) growth this year of 3 percent, down from an earlier 4 percent forecast. Chaiyachoke Suwisuttangkul, Kim Eng's economist, said the SET index has been rebounding in anticipation of positive results from the euro zone's leaders on Oct 23. The SET index gained 15.82 points, or 1.66 percent, yesterday to close at 971.63 in trade worth 25.20 billion baht. He noted the market's extreme volatility, with downside risk including local floods that will trim GDP growth over the next two or three quarters. While the government expects a hit to the 2011 GDP of 1.0 percent to 1.7 percent, Kim Eng is less sanguine and puts the damage at higher than 200 billion baht, with an impact on listed-company earnings at least two quarters ahead. Mr. Chaiyachoke said corporate tax reform would ease the burden for listed firms, but leading sectors such as energy and petrochemicals would still show a decline in the third quarter. The banking sector, despite healthy third-quarter growth, will feel a pinch from small business, corporate loans and hire purchase as clients delay payment or see growth contract in the short term. The flooding is still hard to manage and the global economy remains uncertain, with euro zone public debt unresolved and US unemployment stuck above 9 percent.
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