Thai Airways seen soaring

Thai Airways seen soaring

BANGKOK (Reuter): Thai Airways International (THAI) whose income is about 75 percent dollar-based, is seen flying higher after the baht's de facto devaluation, analysts said yesterday.

They expect the national flag carrier, which posted disappointing first-half results, to show an improvement from the second half of this year as a result of the baht's managed float.

ABN-AMRO Hoare Govett Asia forecast that THAI's net profit in 1998 fiscal year (October-September) would nearly double to 5.95 billion baht (US$205.2 million) from a projected 2.87 billion baht this year.

Thailand last week scrapped the baht's peg against a trade- weighted basket of currencies and allowed the currency to move under a new managed float system.

The move, which saw the baht plummet 15-20 percent, has forced many other Thai corporate with foreign debt exposure into vulnerable loss-making positions.

But they said THAI was one of the few exceptions. The company's revenue and cost structure puts it in a unique position to increase net free cash flow after the baht float.