Thai Power Plant Stocks Reap Gains as Lower US Bond Yield Bolsters Sentiment

published 8 d ago · en · source ↗

Affected tickers

Per-ticker News Sentiment Indicator

BGRIMmacro · positive · high
The decline in U.S. government bond yields reduces borrowing costs for capital-intensive power plant businesses like BGRIM, positively impacting their net profit outlook.
GLOBALother · neutral · high
The article focuses exclusively on the Thai power plant sector and specific stocks like GULF, GPSC, and BGRIM, with no mention of Siam Global House Public Company Limited (GLOBAL).
GPSCmacro · positive · high
The decline in U.S. government bond yields reduces borrowing costs for capital-intensive power plant operators like GPSC, bolstering investor sentiment for the sector.
GULFmacro · positive · high
The decline in U.S. government bond yields reduces borrowing costs for capital-intensive power plant companies like GULF, bolstering investor sentiment for the sector.
LHmacro · neutral · low
The article focuses on the power plant sector and GPSC, mentioning Land and Houses Securities only as an analyst source, with no material impact on LH.
ORmacro · neutral · high
The article focuses on the power plant sector benefiting from lower U.S. bond yields and oil price stabilization, which does not provide specific material news for OR.

Article body

On Monday at 11:43 AM (Bangkok time), the share price of Gulf Development Public Company Limited (SET: GULF ) rose by 1.65% or THB 1.00 to THB 61.75, with a trading value of THB 1.69 billion. Global Power Synergy Public Company Limited (SET: GPSC ) gained 4.35% or THB 1.75 to THB 42.00, with a trading value of THB 333.16 million. B.Grimm Power Public Company Limited (SET: BGRIM ) jumped by 2.99% or THB 0.40 to THB 13.80, with a trading value of THB 327.18 million. Krungsri Securities (KSS) has indicated that the Thai power plant sector has received a boost following a decline in the U.S. government bond yield to approximately 4.5%, down from the previous level of around 4.6%. This comes as negotiations between the United States and Iran have shown progress, with President Donald Trump confirming that most aspects of the agreement have been finalized. Notably, the Strait of Hormuz reopened this morning, with vessel traffic resuming to about half its usual volume. This development positively impacts global risk assets by alleviating concerns regarding the second-round effects on the oil market. The price of Brent crude has also dropped below the support level of $100 per barrel, compared to its prior range of $100–$105 per barrel. The lower 10-year U.S. bond yield and ongoing investment themes in infrastructure technology further support the power plant sector. Krungsri recommends Global Power Synergy (GPSC), raising its target price to THB 48.00 per share. The upward revision is supported by the Gheco-1 power plant, with rising coal prices driven by global energy demand growth from AI development. GPSC’s balance sheet remains strong, with interest-bearing debt to equity currently at 1.1x, positioning the company to benefit from future investment opportunities under the next Power Development Plan. Land and Houses Securities (LHS) notes that although natural gas costs are expected to increase by approximately 10–15% quarter-on-quarter in 2Q26, potentially pressuring SPP margins, this is likely to be offset by increased IU electricity sales and improved performance at the Gheco-1 plant. The plant is expected to see a rebound in revenue from availability payments following the conclusion of maintenance shutdowns. Further positive factors are also anticipated in 2026, including an expected improvement of approximately THB 600 million in annual profit at Gheco-1 due to reduced coal loss mismatch and an increase in profit sharing. These factors should partially offset the margin pressure from higher gas costs. The strategic target price for GPSC is set at THB 49.00 per share, reflecting a 2026 forecasted P/E of 22x and P/B of 1.2x. Power plants are capital-intensive businesses that usually carry high debt burdens from bank loans or corporate bonds. When market interest rates decline (which often accompanies lower bond yields), it allows companies to borrow new funds or refinance existing debt at lower interest rates, ultimately resulting in higher net profits.