Foreign Holdings of Thai Stock Market Hit Record High

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The value of foreign holdings of Thai shares as of August 2023 was recorded at US$168.05 billion (THB5.87 trillion), driven mainly by price increases in some stocks and IPO stocks of new listings, according to the Stock Exchange of Thailand’s SET Note Vol. 16/2023. 

Foreign holdings constituted 30.50 percent of US$551.39 billion (THB19.26 trillion) in market capitalization. This falls slightly below 31.05 percent in May 2017 but is nonetheless a record high in terms of value.

The value of foreign ownership at the end of August 2023 showed an increase of US$21.76 billion (THB760 billion) or 14.95 percent from July 2022.

The increase in foreign holding value is a standout trend against this year’s net outflows from the Thai stock market, which mainly stemmed from the US Federal Reserve’s (Fed) higher-for-longer policy and China’s stuttering economic recovery. This indicates that the sell-off largely comes from short-term investors while long-term investors’ appetite for Thai shares remains strong.

In that period, some sectors managed to run against the tide. Among the sector indices that showed positive gains were Electronic Components (up 97.90 percent) and Banking (up 12.61 percent). This matched foreign investment portfolios, in which the Electronic Components, Energy & Utilities, and Banking sectors were the top three by holding value. As shown by SET Note Vol. 16/2023, foreign ownership of Thai shares in these three sectors was valued at US$87.89 billion (THB3.07 trillion) or 52.34 percent of the total. 

Top 5 foreign investors with the highest holding value in the Thai stock market infographic

Foreign ownership of Thai stocks was consolidated in three industry groups — Technology, Services, and Financials — to which the aforementioned sectors belong. Foreign ownership in these three industry groups was valued at US$116.81 billion (THB4.08 trillion) or 69.40 percent of the total holding value at the end of August 2023. In particular, the Technology group soared 67.07 percent to US$55.25 billion (THB1.93 trillion) in line with a 26.33 percent increase in the Industry Group index. 

Notably, the Services Industry Group moved up from fourth place in the previous report to second with a value of US$31.21 billion (THB1.09 trillion). The Financials Group, falling from second place, recorded US$30.35 billion (THB1.06 trillion) of foreign holdings. That increased by US$1.47 billion (THB51.24 billion) or 5.09 percent against a 0.97 percent drop in the Industry Group index.

Sector by sector, the Electronic Components enjoyed the largest share of foreign holdings, at US$39.51 billion (THB1.38 trillion) or 23.56 percent of the total. This was followed by the Energy & Utilities and the Banking Groups.

The report showed that foreign investors owned all 41 constituents of the MSCI Thailand Index, with a combined amount of US$126.54 billion (THB4.42 trillion) or 75.2 percent of their total holding value at the end of August 2023. Foreign ownership value in the globally recognized benchmark’s constituents rose 19.70 percent from July 2022.

Foreign investors also put US$1.99 billion (THB69.53 billion) into IPO stocks allocated by 45 newly listed companies between April 2022 and March 2023. 

In the latest report, the UK remained at the top of the list of foreign shareholders, holding shares worth US$53.94 billion (THB1.88 trillion) or 32.10 percent. Singapore retained second place, while Hong Kong placed third, ahead of Switzerland at fourth. The US and Japan maintained fifth and sixth places, respectively. Others in the top 10, which constitute 96 percent of total foreign ownership, were the Netherlands, Mauritius, Taiwan, and France.

*Note: Average USD/THB at 34.93 at the end of August 2023 according to data compiled by the Bank of Thailand 

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