Thailand’s cornerstone funds say their plans to invest in PTT Oil and Retail Business (OR)’s initial public offering (IPO) remain unchanged despite high-level criticism of the float. The IPO aims to raise up to Bt54 billion.
Earlier, the Third Council Speaks group led by former Finance Minister Thirachai Phuvanatnaranubala urged the government to investigate the OR share sale over suspicions the company had broken state enterprise arbitration laws. The suspicions concern a dispute over whether some of OR assets should be transferred to the government.
BBL Asset Management (BBLAM)’s CEO said fund managers under its supervision had already made a cornerstone investment agreement for OR shares.
“This shows that BBLAM’s method for allocating OR shares to mutual, private, and provident funds was fair,” said Peerapong Jirasevijinda, adding that the Securities and Exchange Commission (SEC) could also check his company’s asset allocation.
He said fund managers had confidence in OR’s long-term growth, in line with the company’s fundamentals.
“We expect the target price of OR shares in three years to be Bt25-Bt27, compared to the IPO price of Bt16-Bt18,” he said, adding that the Thai stock market is expected to face a correction in the short term.
Siam Commercial Bank Asset Management (SCBAM) also said it would also invest in OR shares under the cornerstone investment agreement.
Nunmanus Piamthipmanus, its chief investment officer, said SCBAM will allocate shares in line with each fund’s investment policy, adding that its fund managers were still positive over OR shares.
“OR has growth potential since profits from its oil business will increase once the government eases lockdown measures, while profits from its retail business will rise from space leasing and overseas investment,” she said.
OR’s IPO price of Bt16-Bt18 was appropriate, she said, adding that its target price would increase by 10-15 per cent in the next two years.
OR expects over 1 million retail investors to subscribe for shares before the February 2 deadline.