Invest
Krung Thai Bank stock reaction to debtor concerns
By Clueless Punter  •  July 17, 2013


On Tuesday 16 July, Krung Thai Bank shares dived 3.59% to close at 18.8 baht over the prospect of high loan loss provision as its borrower Saha Farms Group faced financial difficulties.

KTB has a low non-performing loan coverage ratio of 95% in 1Q compared to industry average of 127%. According to Phillip Securities, they reckon KTB may have to increase their provision in 2Q.

Saha Farms Group is one of the leading chicken exporters in Thailand with 22% market share of total exports. Saha Farms export mainly to Japan, England, Germany, and China, to name a few countries.

Saha Farms faces a liquidity crunch due to incurring losses in 2012 due to increased costs of operations from wages to animal feed. Expenses arising from its business expansion activities the past few years coupled with a downtrend in chicken exports came at the wrong time for Saha Farms.

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By Clueless Punter
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