Nomura Equity Research downgraded cash-and-carry wholesaler
Siam Makro Pcl to 'reduce' from 'neutral', saying the share price has run ahead
of fundamentals and already factors in the possibility of an acquisition deal.
The broker set a price target of 471 baht for Siam Makro.
Siam Makro shares were up 1.4 percent at 568 baht, with a year-to-date gain of 28 percent.
They had hit a record of 594 baht last week after a report major shareholder
SHV Holdings planned to sell the Thai operation, which Siam Makro later denied.
"We have run scenarios on what the company may be worth to a potential acquirer,
but in the absence of any indication of intent from Makro management,
our target price does not factor in any of these scenarios," the broker said in a report.
Investors should switch to supermarket group Big C Supercenter Pcl
which offers higher earnings growth and cheaper valuations, it said.
Nomura's price target for Big C is 267 baht,
reflecting a 25 times forward price-to-earnings multiple versus Makro's 33 times.
Big C shares were up 0.5 percent at 214 baht.
1217 (0517 GMT)
(Reporting by Viparat Jantraprap in Bangkok, Editing by Anupama Dwivedi)
