Shares in Thailand and Taiwan, among Asia's worst performers of the past year, are the region's best picks for investors, according to Nomura Holdings Inc.
"In terms of valuations, the most attractive markets must be in Thailand and Taiwan," Sean Darby, Nomura's Hong Kong-based head of regional strategy, said yesterday in an interview in Singapore. "A lot of the bad news is in the price."
Thailand's SET Index has gained just 18 percent in the past 12 months, beating only Japan, while Taiwan's TAIEX has trailed all other major Asian markets apart from Australia.
The SET is valued at about 11 times earnings, the lowest among 14 regional benchmarks covered by Nomura, while the TAIEX is at 13 times, according to the brokerage's estimates. China's CSI 300 Index is the most expensive at 41 times, followed by India's Sensitive Index at 21 times, Nomura figures show.
The SET has jumped 12 percent since May 30, when a court acquitted the country's second-largest political group of violating laws in last year's election, paving the way for a return to democracy after prime minister Thaksin Shinawatra was removed by military leaders in a September coup.
Meanwhile, foreign investors bought a daily average of NT$9.2 billion (US$281 million) of Taiwanese stocks in the past month, more than three times the daily average of NT$2.4 billion this year. That helped the TAIEX surge 9.1 percent last month, its best monthly performance since July 2003.
Taishin Financial Holdings Co, Formosa Petrochemical Corp. and Taiwan Fertilizer Co are among the stocks Darby recommends investors buy.
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