Cabinet has approved to cap BTS toll rate at the maximum rate of 65 baht across skytrain line as well as transfer losses incurred by BMA of Bt64,000m to BTS. On the other hand, BTS will have rights to operate skytrain of additional 30 years after the current concession expires. With regards to BTSGIF, BTS will subsidize any revenues losses from such cap rate 65 baht policy. Interior Ministry to propose cabinet today to extend BTS’s skytrain concession for 30 years in an exchange for Bt64b BMA debt, fare ceiling cap at Bt65/trip, adjusted every 2 years.

Comment: I just took the route from the purple line (nonthaburi) back to the Sukhumvit line yesterday. Lots of traffic, but switching amongst the two operators led to a 1 way trip costing ~THB 90. I can’t imagine having to pay ~THB 180 per way excluding transportation costs to get to the train being feasible for the majority of the people working in Bangkok. This is what happens when the private sector invests and manages what should be government operated like the the MRT in Singapore. And then part of me thinks, imagine there was no corruption…-30% in investment costs for firms such as BTS and BEM…-30% impact on the consumer. Anyways net net this is still +ve for BTS.

GPSC’s weak 3Q earnings was on interest costs related to GLOW acquisition, but 4Q will be strong after consolidating GLOW, contribution from Xayaburi and lower D/E from 3.9X to 1X following a Bt74b capital increase.

Comment: The consolidation of GLOW is a straightforward exercise.

SCC expects profit bottom out 4Q after profit hurt by narrow chem spreads in 3Q, sees limited GPM downside from cushion of high value added products, improved building materials & packaging business, dividend income and absence of extra ordinary expense should ease pressure, signs collaboration with Chinese Academy of Sciences (CAS) to develop HVA chem & energy storage business.

Comment: @ its all about the spreads for SCC, not cement.

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