Dr. Sethaput Suthiwart-Narueput, SET Senior Vice President- Research and Public Information Division, revealed at the “Top Executives’ Networking Forum 2005”, held from March 4-6, 2005, that the SET will introduce its SET100 index, which is an additional price index designed on the SET and SET50 indices, to provide the market with an index covering 100 medium- to large-sized companies which have suitable levels of liquidity and share distributions. The new index will better be able to reflect the current THB5 trillion market capitalization.
“Currently, companies in the SET50 Index represent only 11% of all listed companies on the SET, but their joint trade volume is equivalent to more than half of the total volume and has a market value of 72% of the entire market. The introduction of the SET100 will help distribute investment to cover all the quality medium-sized companies, resulting in better liquidity for each company”, said Dr. Sethaput.
In terms of benefits for listed firms, Mr. Vicha Poolvaraluck, President and CEO of Major Cineplex Group Plc, agreed that the SET100 Index will play a major role in pushing for business growth while helping each firm to reach a suitable size and more market capitalization. This is because the index will not only open chances for more institutional investors to invest, but will also attract more retail investors who are interested in firms listed in the SET100.
Mr. Thavatchai Vilailuck, President of Samart Corporation Plc, said that being included in the SET100 group will greatly benefit medium-sized companies because, at present, institutional investors and securities analysts have not shown an interest in companies smaller than those found on the SET50.
The SET SVP went on to say “the criteria that will be used in selecting companies to be included in the SET100 group will include a liquidity criterion and each company’s share distribution, just like those used for firms included in the SET50. This means companies included in the SET100 and the SET50 must be from the same group of listed companies, which have recorded average market values during the past 12 months that made it into the top 200 list and have had constant trade volumes as well as have a free float of not less than 20%. The shares that pass these criteria will be ranked in accordance with their market value. The top 50 firms will be included in the SET50, and the top 100 companies will be included in the SET100”.
The SET will announce the firms that will comprise the SET100 on April 18, and will start publicizing the new index commencing from May 3, 2005. The share prices on April 30, 2005 will be the base date and the index will start at 1,000 points.
“Any adjustments to the share lists on the SET100 and SET50 will be announced every 6 months, or around June 15 for the firms to be used during the second half of the year, and around December 15 for the companies to be used during the first half of the year. The names that will be announced will consist of firms that are used in the index calculations for the SET100 and the SET50. The back-up list will be used for index calculations only when the common shares currently on the SET100 or the SET50 are removed from the stock market”, concluded Dr. Sethaput.
