GEMS FIRST TO MARKET

Research evidence excerpt

GEMS FIRST TO MARKET

Global Equity Research

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GEMS First To Market 19 June 2026

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Thailand Equity Strategy (Khoi Vu, CFA/Rajiv Batra/Kae Pornpunnarath, CFA), Thailand

Oil price normalization opens a window for mean reversion trade

The Thai SET index continues to defy gravity, extending the rally by nearly 5%pt over the last one month. Would the US-Iran

peace deal and oil price normalization provide an additional boost to equities? We believe the answer would be

different for different sectors. Energy, Utilities, and Materials sectors' profitability outlook would likely reverse after a period of

strong upgrades. On the flip side, the consumer sector should benefit from lower input costs and recovering consumer

confidence. However, the headwinds have not fully abated, as reduced tourism flows, El Niño risk, and limited room for further

fiscal stimulus could curb optimism. We believe that oil price normalization could open a short-term window for a mean

reversion trade, which would focus on: (1) Stocks with earnings revisions that could turn positive; (2) Stocks with valuation de-

rated in the last three months with chances of reversals; and (3) Stocks that got sold off by foreign investors and could see

flows reverse. (See Table 2,3,4). Oil & Gas sector, which has been the consensus over the past few months of both local

& foreign investors, would be the funding source as positioning rotates. Both SET and MSCI Thailand now trade near 5Y