Thai Tourism Stocks Recover on US-Iran De-Escalation
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- Tourist arrivals to Thailand in the third week of June totaled 510,000, down 3% year-on-year, with Chinese up 11%, Malaysians up 9%, and Russians up 7%, while South Koreans contracted 42% and Indians 10%.
- Thailand's baht has weakened more than 5% year-to-date to around 33.30 per dollar, increasing value-for-money for visitors, according to Asia Plus Securities analyst Pasakorn Wangvivatchareon.
- KGI Securities' Sirilak Konwai reports that hotel RevPAR returned to positive growth across all listed operators in May, yet sector shares still trade 5-12% below pre-conflict levels.
- Jet fuel has averaged $143.41 per barrel year-to-date, suggesting full-year prices will come in below Krungsri Securities' $160-per-barrel assumption and offering upside for airline stocks.
- International airline seat capacity for Thailand is expected to grow 3.5% in Q3 — the strongest since Q1 — with flight cancellations slowing after nearly 4,000 in Q2, according to Maybank Securities (Thailand).
- Thai hospitals have underperformed the SET due to weak Middle East patient demand, but CGS International Securities' Kasem Prunratanamala expects earnings to bottom out and recover in H2 as regional tensions ease.
Why it matters: Thai tourism operators face a triple tailwind: jet fuel at $143/bbl YTD vs. the $160 broker assumption, a baht down 5%+ boosting visitor purchasing power, and Q3 seat capacity growing 3.5% — the strongest since Q1. Hotel shares still trade 5-12% below pre-conflict levels, leaving KGI room to lift its 7% earnings growth forecast as Middle East tourist and medical-patient flows normalize.