Thai Equity - Bottom-up - Equities, Pi Securities PCL, Thailand

Pi Research

Thai Equity - Bottom-up - Equities

Leading, full-service investment firm in Thailand

Pi Securities PCL, Thailand

Pi Securities is a well known securities company with 40 years experience in the industry, serving more than 60,000 clients. We offer one - stop service providing full range of financial products and services including extensive Brokerage, Proprietary Trading (Equities and Bonds), Advisory Services, Structured Products.

Moreover, our new research team tailored for institutional clients to focus on mid to small cap of Thai equities and trading strategies. Our services offered to our premium clients also include arrangement of company or site visits to with the managements of Thai listed companies.

Note: Effective on 1 March 2022, Country Group Securities PCL changed its name to Pi Securities

Equity Bottom-Up

<ul>
<li>We expect core earnings recovery in 2HFY23 (Oct’22-Mar’23) to come at slower pace than we previously expected given;1.)heavy marketing and set-up costs needed to be allocate for digital and financial </li>
<li>2QFY23 (July-Sept’22) core profit fell to four-quarter low The company reported 2QFY23 net profit at Bt474m. Excluding extra items, core earnings should be at Bt336m,(+6%YoY-45%QoQ),which is lower than market estimate.</li>
<li>QoQ contraction was due to equity income that turned to loss worth Bt116m compared with Bt213m shared-profit in in 1QFY23 mainly dragged down by disappointed performance from U-city (35% stake)</li>
</ul>


We expect core earnings recovery in 2HFY23 (Oct’22-Mar’23) to come at slower pace than we previously expected given;1.)heavy marketing and set-up costs needed to be allocate for digital and financial 
2QFY23 (July-Sept’22) core profit fell to four-quarter low The company reported 2QFY23 net profit at Bt474m. Excluding extra items, core earnings should be at Bt336m,(+6%YoY-45%QoQ),which is lower than market estimate.
QoQ contraction was due to equity income that turned to loss worth Bt116m compared with Bt213m shared-profit in in 1QFY23 mainly dragged down by disappointed performance from U-city (35% stake)


BTS : ’Core Earnings Should Recover Gradually in 2HFY23

<ul>
<li>We have a slight positive view on the company’s new investment in Thanulux PCL (TNL)as it expected to expand loan portfolio and strengthening synergy among business entities under financial service</li>
<li>Bonding with leading consumer products conglomerate ‘SPI’ The company announced to acquire newly issued ordinary shares under private placement of TNL,the ready-made clothes and leather ware manufacturers and the subsidiary</li>
<li>After the transaction complete by end of 2022, TNL will invest in the secured lending business (land as a collateral) called ‘Oxygen’ worth around Bt4.3bn (90% stake). Currently</li>
</ul>


We have a slight positive view on the company’s new investment in Thanulux PCL (TNL)as it expected to expand loan portfolio and strengthening synergy among business entities under financial service
Bonding with leading consumer products conglomerate ‘SPI’ The company announced to acquire newly issued ordinary shares under private placement of TNL,the ready-made clothes and leather ware manufacturers and the subsidiary
After the transaction complete by end of 2022, TNL will invest in the secured lending business (land as a collateral) called ‘Oxygen’ worth around Bt4.3bn (90% stake). Currently


BTS : Expect Long-Term Synergy with SPI PCL

<ul>
<li>We cut BTS target price to Bt10.20 (Previous TP:Bt11.0)after we trim target price of VGI (52% stake) to Bt4.60 as we factor in weaker-than-expected recovery in ad revenue and damage </li>
<li>1QFY23 (April-June’22) fell to three-quarter low The company reported 1QFY23 net profit at Bt536m. Excluding extra items, core earnings would be at Bt610m, (-49%YoY -28%QoQ).</li>
<li>A QoQ and YoY contraction pressured by revenue that drop to 16-quarter low at Bt4.0bn dragged down by construction revenue to Bt1.1bn (-80%YoY -30%QoQ) amid nearly completion of MRT pink </li>
</ul>


We cut BTS target price to Bt10.20 (Previous TP:Bt11.0)after we trim target price of VGI (52% stake) to Bt4.60 as we factor in weaker-than-expected recovery in ad revenue and damage 
1QFY23 (April-June’22) fell to three-quarter low The company reported 1QFY23 net profit at Bt536m. Excluding extra items, core earnings would be at Bt610m, (-49%YoY -28%QoQ).
A QoQ and YoY contraction pressured by revenue that drop to 16-quarter low at Bt4.0bn dragged down by construction revenue to Bt1.1bn (-80%YoY -30%QoQ) amid nearly completion of MRT pink 


BTS : Concern over Concession Extension Remain an Overhang on Stock

<ul>
<li>We reiterate a BUY rating for BTS while roll over target price to Bt11.0 (Previous TP: Bt10.20), derived from SOTP.</li>
<li>BTS report 2QFY22 (July’21-Sep’21) net profit at Bt576m (-24%YoY -58%QoQ), the lowest level in the past five quarter. The result came out slightly below our expectation while 9M21 result accounts </li>
<li>Disappointed earnings reported in 2QFY22 was pressured by 13-quarter low of revenue and increasing share of loss from weak U-city and KEX performance.</li>
</ul>


We reiterate a BUY rating for BTS while roll over target price to Bt11.0 (Previous TP: Bt10.20), derived from SOTP.
BTS report 2QFY22 (July’21-Sep’21) net profit at Bt576m (-24%YoY -58%QoQ), the lowest level in the past five quarter. The result came out slightly below our expectation while 9M21 result accounts 
Disappointed earnings reported in 2QFY22 was pressured by 13-quarter low of revenue and increasing share of loss from weak U-city and KEX performance.


BTS: Short & Long Terms Outlook Remain Positive

Head of Research, Krungthai XSpring

Waraporn Wiboonkanarak

Head of Research

A full service Thai brokerage

Krungthai XSpring

Krungthai XSpring is a full service broker. The company provides a wide range of investment services such as Securities Brokerage, Derivative Agent Business, Securities Borrowing and Lending, Securities Trading, Underwriting, Financial Advisory, Wealth Advisory, Private Fund Management and International Markets Securities Trading. 

In terms of credibility, Fitch Ratings has assigned Krunghtai XSpring a long-term rating of AA- and a national short-term rating of F1+ with stable outlook.

<p>BTS’s earnings topped the market’s forecast in 1QFY21/22 owing to extra items. Meanwhile, the core profit was in line with the expectation. We maintain our earnings projection and a Hold rating for BTS pending improvement in the COVID-19 situation, the easing of the lockdown and progress on new contracts.</p>

BTS’s earnings topped the market’s forecast in 1QFY21/22 owing to extra items. Meanwhile, the core profit was in line with the expectation. We maintain our earnings projection and a Hold rating for BTS pending improvement in the COVID-19 situation, the easing of the lockdown and progress on new contracts.

Earnings Review: BTS Group Holdings Plc. (BTS)

Thailand

BTS Group Holdings PCL is primarily in the business of Mass Transit.  The Company operates Bangkok's BTS SkyTrain system and the Bus Rapid Transit (BRT) System. BTS Group Holdings PCL is also involved in Media & Advertising, Property Development, and Services business.

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BTS Group Holdings (BTS TB)

BTS : ’Core Earnings Should Recover Gradually in 2HFY23

We expect core earnings recovery in 2HFY23 (Oct’22-Mar’23) to come at slower pace than we previously expected given; 1.) heavy marketing and set-up...

Pi Securities PCL, Thailand

BTS : Expect Long-Term Synergy with SPI PCL

We have a slight positive view on the company’s new investment in Thanulux PCL (TNL) as it expected to expand loan portfolio and strengthening...

Pi Securities PCL, Thailand

BTS : Concern over Concession Extension Remain an Overhang on Stock

We cut BTS target price to Bt10.20 (Previous TP: Bt11.0) after we trim target price of VGI (52% stake) to Bt4.60 as we factor in weaker-than...

Pi Securities PCL, Thailand

BTS: Short & Long Terms Outlook Remain Positive

We reiterate a BUY rating for BTS while roll over target price to Bt11.0 (Previous TP: Bt10.20), derived from SOTP. Our target price upgrade was...

Pi Securities PCL, Thailand

Earnings Review: BTS Group Holdings Plc. (BTS)

Core profit in line, BTS’s earnings topped the market’s forecast in 1QFY21/22 owing to extra items. core profit was in line with the expectation

Krungthai XSpring

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