Mr. Vasin Vanichvoranun, Executive Chairman of KASIKORN ASSET MANAGEMENT Co., Ltd. (KAsset) said that December 30, 2019 will be the final day for investment in LTFs that are entitled to tax benefits. Moreover, investors in LTFs will have a chance to benefit from attractive returns from the Thai stock market over the long-term. From 2020 onward, KAsset still maintains its strategies in managing a total of eight LTFs while also planning to launch a sub-class of LTFs to draw investors to continue investing in this type of fund.
Mr. Vasin said that according to KAsset's plan to introduce a sub-class of LTFs, the company will separate investors into two groups i.e. existing and new investors. However, the company is required to have purchase orders of LTFs suspended, pending the clarity of the relevant financial law to be enacted in 2020. Therefore, LTF purchase orders via all digital channels i.e. K PLUS, K-My Funds and K-Cyber Invest will be automatically cancelled from January 2, 2023 onwards. Customers who use K-Saving Plan and Investment Plan are not required to cancel the services personally.
It has been widely known that super savings funds (SSF) will, from next year, substitute for long-term equity fund (LTF) as a new tax-saving fund. KAsset is getting ready to set up SSFs in accordance with the new structure, which allows asset management companies to implement policy to invest in all asset classes i.e. debt instruments, Thai and international equities and mixed funds to add diverse investment choices, enabling them to adjust portfolios to generate proper returns. Meanwhile, LTFs under the management of KAsset will continue to be overseen by experienced fund managers, who are equipped with an expertise in selecting Thai stocks with strong potential and an ability to manage risks to keep them at an appropriate level. Hence, the funds will generate consistent returns. Investors can be assured that LTFs under the management of KAsset will continue to be well taken care of. This year, we would like to recommend the LTF investment at the maximum amount for tax benefits or up to 15 percent of taxable personal income or no more than 500,000 Baht. KAsset also recommends the investment in KDLTF, which focuses on blue-chip stocks with strong fundamentals, diversifying across various industrial sectors. KDLTF has paid higher dividends than other funds under the management of KAsset by regularly paying dividends in the past 12 years,19 times, totaling 8.76 Baht per unit (Source: KAsset, the information as of September 30, 2019), he said.
Mr. Vasin added that the SET Index is expected to move sideways at the end of 2019. However, KAsset maintains a positive view towards the Thai bourse in 2020 due to several factors. These include: 1) the fact that the market has already absorbed most downside risks while long-term returns from the stock market remain more attractive than other assets amid relatively high liquidity in the system; 2) interest rates remain low, meaning that the P/E ratio will likely be higher than the average value seen in the past; and, 3) the Thai economy will likely be bolstered by public spending and investment. In addition, if the impact of the trade war eases, it is likely that the SET Index will rise to 1,700 points, with a Forward P/E ratio at 16.5 times. However, if the trade dispute worsens, the SET Index may slip to 1,500 points, with a Forward P/E ratio at 14.5 points, which would be close to the average value seen five years ago.
Investors interested in investing in KBank LTFs can start their investment at only 500 Baht via K PLUS, K-My Funds, KBank branches and our sales agents. An investment prospectus can be obtained via those channels. For more details, please contact the KAsset Contact Center, Tel. 0 2673 3888