Thai corporate earnings improve across sectors: Fitch Ratings

The report paints a mixed picture of improving corporate financial performance across sectors: corporate profits are rising, but debt remains high thanks to heavy investment.

The event also discussed asset allocation strategies and credit investment frameworks, providing valuable insights into the corporate landscape in Thailand in the context of post-pandemic recovery and long-term strategic investments.

Senior Director of Corporate Ratings at Fitch Ratings, Obboon Thirachit, It was emphasized that the steady recovery in tourism and the resumption of government spending are supporting further growth in the profits of Fitch-rated companies from the aviation, hotel and construction materials sectors.

“Lower fuel costs are also benefiting the power and utility sectors, although heavy investment in renewables could further increase the utility sector’s already high debt burden,” he noted.

Meanwhile, the oil and gas sector is expected to post moderate gains from a high base, in line with falling oil and gas prices, but should remain strong overall with healthy gains. On the other hand, weak global economic conditions and new supply are hampering the recovery in the petrochemical sector.

He noted that while Fitch-rated Thai corporate issuers have demonstrated prudent cash flow management during the Covid-19 pandemic, the outlook suggests that investments and acquisitions have increased, especially in the oil and gas sector.