Thai banks – more needed for further re-rating

Research evidence excerpt

Thai banks – more needed for further re-rating

Idea

July 14, 2026 12:07 PM GMT

Morgan Stanley Asia (Singapore) Pte.+MASEAN Financials | Asia Pacific Selvie Jusman, CFA

Equity Analyst

Thai banks – more needed for Selvie.Jusman@morganstanley.comNick Lord +65 6834-6517

Nick.Lord@morganstanley.com +65 6834-6746

further re-rating

Thai banks have re-rated sharply YTD with strong foreign

inflows and a ~6% yield. This has pushed valuations above

averages (~0.85x P/BV, ~11.1x P/E), leaving them near fair levels. ASEAN Financials

With softer 2Q26 earnings expected, further upside now hinges Asia Pacific

Industry View In-Line

on earnings delivery – BBL remains our preferred play.

What’s Changed

Thai banks have outperformed other EM in ASEAN YTD: Share prices are up ~12– Kasikorn Bank Public

Company (KBANK.BK) From To

43%, supported by a combination of easing macro concerns, improving political Price Target Bt197.10 Bt199.20

stability, and renewed foreign inflows. The group has also benefited from its Krung Thai Bank Public

defensive yield appeal (~6%), attracting investors amid an environment of lower Company (KTB.BK) From To

Price Target Bt23.80 Bt26.10

rates. This has driven a meaningful re-rating across the group despite only modest

earnings growth. TMBThanachart Bank PCL

(TTB.BK) From To

Price Target Bt1.69 Bt1.83

As a result, valuations are no longer as compelling: Thai banks are now trading at

~0.85x forward P/BV and ~11.1x P/E, both above three- to five-year averages,

suggesting that the group has moved from deep value to closer to fair valuation.

The re-rating has also been partly driven by flow and sentiment (foreign net inflow

of Bt53.6bn to the SET YTD) despite muted earnings growth. We believe sustained