CIMB Thai foresees bright prospect for domestic equity market

Sittichai Mahaguna, executive vice president & head of corporate finance & equity markets group, CIMB Thai

The first few months of the current year have been challenging for deal makers in Thailand. Despite this, the CIMB Thai remains bullish on the the equity market and predicts that the country will continue to witness heightened activity in M&A, a trend that has been carried forward from the last year.

In an exclusive interview with DEALSTREETASIA, Sittichai Mahaguna, executive vice president and head of corporate finance & equity markets group, said that the company anticipated the value of its deals for 2015 to go beyond 20 billion baht ($617.28 million); slightly higher than the figure last year (when it nearly touched 20 billion baht.)

This year CIMB Thai plans to help list four companies on the Stock Exchange of Thailand (SET). These will have a combined market capitalisation of five billion-six billion baht. One of them is the fertilizer producer Baconco Co and the other three include, an auto-part maker, a food producer and a property developer.

The bank has a few companies in the pipeline, slated for listing in 2016. Each of them has the market capitalisation of more than 1 billion baht.

“The number of IPO clients is increasing continuously because the market trend has changed. In the past, only the big companies would consider being listed, but nowadays entrepreneurs shape their companies and plan the listings right from the beginning,” he said. “Therefore, we are trying to strengthen our brand in a bid to serve the growing demand in the future.”

He added that currently, the trend of the real estate investment trusts (REITs) and infrastructural funds was more visible and attractive. CIMB Thai will also launch two real estate investment trusts (REITs) this year. One of them is the office building and the other is a combination of two or three hotels.

Also read: Snapshot of ASEAN M&A trends: Early indicator of business confidence

In the mergers and acquisition (M&A) space, it is targetting to close seven deals, with a combined value of more than 10 billion baht this year. The size of each deal will be between 500 million baht to five billion baht.

“We focus on making deals in ASEAN where we have strong networks. In general, the deal size has become larger. More companies are considering M&A for expanding and boosting the competitiveness of their business,” the executive said.

In Thailand, the high potential sectors for M&A include the sectors of hospitality, healthcare, food, and renewable energy; where substantial size helps the companies compete with in other countries, as well.

Meanwhile, Indonesia has attracted some Thai industrial firms as investors and to set up the plants there in a bid to enjoy demand from its big market size, he added.

The overall market is likely to improve from last year, but he remains concerned about the effectiveness of government’s measures regarding the recovery of  the country’s economy.

“The downward trend of oil price and higher market demand give us the positive prospect. However, the main factor are the government’s measures for boosting the economy and promoting investment,” he added.

Related stories:

CIMB to close its Australian IB operations

CIMB-RHB-MBSB: mega merger aborted?

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.