Stronger-than-expected first-quarter earnings by listed companies are reinforcing selective investment opportunities for the rest of 2026, particularly in sectors tied to foreign direct investment (FDI), digital infrastructure and domestic consumption, despite the fact that rising energy costs could pressure the real sector from the second quarter onward, says Bualuang Securities (BLS).
According to Piriyapon Kongvanich, head of equity research at BLS, net profit among companies listed on the Stock Exchange of Thailand (SET) rose 29% year-on-year and 56% quarter-on-quarter in the first quarter, beating market expectations by 14.7% and exceeding BLS estimates for stocks under its coverage by 16%.
Excluding special items, core earnings surged 44% year-on-year and 45% quarter-on-quarter, also above forecasts, he said, attributing the growth to higher refinery margins and petrochemical spreads, resilient mobile and internet service revenue, lower network costs, and rising demand for artificial intelligence and data-centre-related electronics.
Increased power generation capacity and stronger overseas power plant earnings from Gulf Development (GULF) also provided significant support to market earnings.
On the contrary, narrowing net interest margins continued to weigh on the banking sector, while hospitals faced pressure from lower Cambodian patient numbers and slower spending among Thai self-pay patients.
"Around 59% of listed firms reported earnings above expectations -- a level close to the Covid-19 period, suggesting market expectations had been overly conservative," Mr Piriyapon said.
He also noted that upward revisions to SET earnings forecasts between March and May should help "limit downside risks for the market".
According to BLS, SET earnings projections have been revised up about 3% since March, driven mainly by cyclical sectors such as energy, petrochemicals and electronics, while airlines and property stocks saw downward revisions. Still, the brokerage maintained its end-2026 SET index target at 1,550 points, citing limited upside amid a range-bound market outlook.
Mr Piriyapon, nevertheless, warned that while the impact of new cost pressures may remain manageable in the second quarter, the effects are likely to become more significant by the third quarter of 2026. Consequently, investors are likely to remain highly selective, favouring sectors positioned to benefit from structural investment trends and government stimulus measures.
BLS recommends industrial estate developer Amata Corporation (AMATA), driven by FDI-linked infrastructure investment, alongside power producer GULF and telecom operator Advanced Info Service (ADVANC).
Retail technology chains Com7 (COM7) and Advice IT Infinite (ADVICE), as well as mall operator Central Pattana (CPN), are also expected to deliver continued earnings growth in the second quarter.
For trading opportunities, BLS recommended "margin-cushioned laggards", including Central Retail Corporation (CRC), where margins continued to improve in April-May due to better inventory management and positive same-store sales growth.
Siam Global House (GLOBAL) is expected to benefit from a higher proportion of private-label products and lower product costs, while CP All (CPALL) should continue to gain from stronger sales of high-margin ready-to-eat food products.
