PTT Plc's share price plunged Bt12, or 5 per cent, yesterday, mainly on mounting concerns over the company's prospects following the Supreme Administrative Court decision to prosecute a petition against the privatisation of the energy company.

The stakes are high. In a single day, Bt35.32 billion of the gas giant's market capitalisation was wiped out.

PTT's stock has the highest individual weighting on the market, accounting for 13 per cent of the stock exchange's combined market capitalisation. Its fall shaved 1.3 per cent off the Stock Exchange of Thailand composite index. Contributing to PTT's plunge were the sharp fall in global oil prices and the XD (exempt dividend) sign posted on its shares.

PTT president Prasert Bunsum-pun said in a filing to the Stock Exchange of Thailand yesterday that the company was ready to provide the court with all necessary information.

"During this time, we are operating as usual and are as committed to efficient and transparent business management as ever," he said in the statement.

The SET Index fell below the psychologically key 700-point level immediately after the curtain was raised, and bottomed out at 690.66 points in the first trading session. It recovered marginally to close the day at 692.56. Turnover was thin at Bt9.31 billion and foreign investors were net sellers of Thai shares, with a net position of Bt461.50 million.

JP Morgan Securities (Thailand) president Marco Sucharitkul said the court's decision had sent tremors through the Thai stock market. Some foreign investors dumped PTT stock to lower their risk from uncertainty, he said.

He said his firm's foreign clients had three different takes on the PTT case. The first group of investors sold PTT stocks because they feared it would be delisted. The second group of investors dumped the stock because they could not predict the company's fate, though they planned to buy back shares when the price was low. The last group did not expect any changes in PTT's listing status.

"Regardless of the outcome, the court's decision to hear the petition affected the stock market because it is the biggest market cap stock, weighing as much as 13 per cent of the SET index," he said.

The chief executive officer of Kim Eng Securities (Thailand), Montree Sornpaisarn, forecast that PTT would not be delisted because of the serious impact it would have on the bourse.

He also predicted that PTT's case would not erode foreign investors' confidence in the country.

He pointed out that PTT and the Electricity Generating Authority of Thailand (Egat) were very different cases. Egat's privatisation was blocked by the same court last year before it could be listed on the exchange.

A source at the Federation of Thai Capital Market Organisation said the federation would submit a list of the pros and cons of PTT's listing on the stock market to the court.

Meanwhile, Trinity Securities forecast that the SET index would hover around the 650-660 level for the remainder of the year because the effects of the economic slowdown had not yet been factored in to market conditions, said deputy managing director Visit Ongpipattanakul.

The court announced on Wednesday that within 30 days, three defendants - caretaker Prime Minister Thaksin Shinawatra, caretaker Energy Minister Viset Choopiban and the Cabinet - would need to explain their actions in connection with the privatisation of PTT.

A source at the Energy Ministry said the ministry would soon call a meeting of all parties involved, particularly representatives of PTT and the Attorney-General's Office (OAG), to brainstorm a defence. The source added that a working committee would be set up to take care of information-gathering and document-preparation.

Viset said yesterday that the Attorney General's Office would represent the ministry during the hearing.

Deputy Finance Minister Chaiyot Sasomsub also expressed readiness to back up the defence. "The State Enterprise Policy Office will have to be prepared for this," he said.

Chaiyot said the court's decision to prosecute would have an impact on the government's privatisation policy.

"However, any ruling will set a clear precedent for future privatisation. We should know better how to proceed with the policy," he said.

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