Recommendation: Buy

Securities house: Phatra Securities Airports of Thailand last week released its March traffic statistics, showing solid growth during the month.

Total passenger volume expanded by a hefty 14.5 per cent year on the year to 4.6 million. That made double-digit growth for the third month in a row.

In the six months ended March 31, traffic at the country's main airports, which are run by AOT, rose by 8.9 per cent year on year against the broker's assumption of 7.7 per cent for the whole year.

The broker expects AOT will be able to achieve its growth forecast.

Any relief in the political situation should also support growth in the medium term.

Bangkok International Airport recorded a 13.1-per-cent year-on-year increase in passenger volume during March, while traffic at Phuket International Airport soared by an lofty 47.3 per cent from the same period in 2005.

Apart from being a monopoly aircraft gateway into and out of the Kingdom, the capacity expansion the country will receive as a result of the new Suvarnabhumi Airport should provide 30-per-cent earnings growth before interest, tax, depreciation and amortisation in its fiscal 2007 year.

AOT is also entering a rising free cash-flow cycle as this new facility is nearly completed.

The broker has set its price objective for the company's stock at Bt67 per share.

Stock: Advanced Info Service Plc (ADVANC)

Rating: Neutral

Securities house: SCB Securities

   Advanced Info Service (AIS) reported net additional new subscribers of 87,700 in March, resulting in new customer growth of 161 per cent month on month.

   This was a move in the opposite direction from what management had earlier indicated.

   The company said that net additions jumped significantly after the release of the new give-away package.

   The net adds were much higher than the broker's estimate of 10,000-15,000 and bring total net adds for the three months of the year to 225,000.

   Average revenue per user (ARPU) in March rose by Bt392, representing a 3-per-cent month-on-month increase from Bt381 in the previous month.

   However, this was due to the fact that there were more days in March. If adjusted to a 30-day basis, AIS's ARPU reveals a drop of 7 per cent on the month.

   The broker estimates that AIS's first-quarter profit core should come in at at Bt5.13 billion, up 4 per cent quarter on quarter but down 4 per cent year on year.

   The broker, however, continues to be concerned that AIS, the largest cell phone service provider in the country, is sacrificing ARPU in order to gain higher net add figures.

Stock: Delta Electronics Plc (DELTA)

Recommendation: Hold

Securities house: DBS Vickers Securities (Thailand)

   Despite an estimated 5-per-cent drop in sales, Delta Electronics' first-quarter net profit is expected to surge 146 per cent year on year to Bt453 million.

   Operating results should remain favourable for the rest of the year, with growth coming mainly from margin expansion.

   Delta has dropped low-margin products such as notebook adapters, power supplies for desktop PCs, LCD and CRT monitors, to focus on higher-margin products such as power supplies for networking systems and LCD televisions.

   But the strengthening baht against the greenback will eat into its margin and result in more foreign exchange losses.

   The broker has cut its 2006 and 2007 earnings forecasts for Delta by 5-15 per cent to reflect the change in its forex assumption from Bt40 per dollar and Bt39 to Bt38.50 and Bt37 in 2006 and 2007, respectively.

   It has raised its target price for the stock at Bt22.50 per share.

oranan@nationgroup.com