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>Last week analyst meeting came out with a positive tone regarding2022-25 earnings outlook.We reiterate our BUY rating for CBG and roll over target price to Bt125 (Previous TP is Bt115)</li>
<li>We expect GPM to bottomed out in 1Q22 caused by 1) higher revenue contribution from branded own segment (higher than average blended GPM), 2) wholesale price adjustment by 1%-3%</li>
<li>We expect CBG to show a strong performance in 2022-25 supported by recovery sales in Cambodia, solid revenue in Myanmar, breaking into the Chinese market successfully, growth opportunities in Vietnam</li>
</ul>


Last week analyst meeting came out with a positive tone regarding2022-25 earnings outlook.We reiterate our BUY rating for CBG and roll over target price to Bt125 (Previous TP is Bt115)
We expect GPM to bottomed out in 1Q22 caused by 1) higher revenue contribution from branded own segment (higher than average blended GPM), 2) wholesale price adjustment by 1%-3%
We expect CBG to show a strong performance in 2022-25 supported by recovery sales in Cambodia, solid revenue in Myanmar, breaking into the Chinese market successfully, growth opportunities in Vietnam


<ul>
<li>We upgrade our recommendation for CBG from HOLD to BUY with a new target price of Bt115 (-9% from previous TP), derived from 35xPE’22E, the average of the Thai energy </li>
<li>We forecast 2022E earnings to recover to Bt3.3bn (+16%YoY) supported by (1) recovering sales in CLMV market, (2) Solid liquor’s distribution revenue growth, and (3) new product launches in Thailand.</li>
<li>Expect earnings to bounce back to roughly Bt800m in 2Q22,while we believe gross profit margin had already bottomed in 4Q21and expecting it to recover in 1Q22,supported by higher sales contribution </li>
</ul>


We upgrade our recommendation for CBG from HOLD to BUY with a new target price of Bt115 (-9% from previous TP), derived from 35xPE’22E, the average of the Thai energy 
We forecast 2022E earnings to recover to Bt3.3bn (+16%YoY) supported by (1) recovering sales in CLMV market, (2) Solid liquor’s distribution revenue growth, and (3) new product launches in Thailand.
Expect earnings to bounce back to roughly Bt800m in 2Q22,while we believe gross profit margin had already bottomed in 4Q21and expecting it to recover in 1Q22,supported by higher sales contribution 


CBG: Expect Earnings to Recover YoY Supported by New Product Launches

<ul>
<li>We reiterate a BUY rating for CBG with a target price of Bt131 based on 35xPE’22E, the average of the Thailand energy drink stocks.</li>
<li>We expect CBG to post 4Q21 net profit of Bt674m (-23%YoY, +12%QoQ), a recovery from the lowest level in the past nine quarters in 3Q21.</li>
<li>We foresee 2022E earnings to hit the record high at Bt3.7bn (+32%YoY)driven by a solid revenue growth at +25%YoY from recovering sales in Thailand and CLMV market from low base</li>
</ul>


We reiterate a BUY rating for CBG with a target price of Bt131 based on 35xPE’22E, the average of the Thailand energy drink stocks.
We expect CBG to post 4Q21 net profit of Bt674m (-23%YoY, +12%QoQ), a recovery from the lowest level in the past nine quarters in 3Q21.
We foresee 2022E earnings to hit the record high at Bt3.7bn (+32%YoY)driven by a solid revenue growth at +25%YoY from recovering sales in Thailand and CLMV market from low base


ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

<ul>
<li>
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> was hit by COVID lockdowns in 3Q2021 but the recovery has already started for its retail and packaging businesses, especially in Vietnam for the latter.</li>
<li>The company's expansion plans for Mini Big C continue apace, as well conversions to Food Place and its store renovation program, which points toward a strong growth recovery in 2022.</li>
<li>The competitive intensity in Thai retail is reducing, with CP Group's acquisition of Tesco Thailand reducing major players to two, whilst there is a further restructuring under <a href="https://www.smartkarma.com/entities/siam-makro-public-co-ltd" target="_blank" data-smartkarma-citation="entities:5577:1" rel="noopener">Siam Makro Public.</a>
</li>
</ul>



Berli Jucker (BJC TB) was hit by COVID lockdowns in 3Q2021 but the recovery has already started for its retail and packaging businesses, especially in Vietnam for the latter.
The company's expansion plans for Mini Big C continue apace, as well conversions to Food Place and its store renovation program, which points toward a strong growth recovery in 2022.
The competitive intensity in Thai retail is reducing, with CP Group's acquisition of Tesco Thailand reducing major players to two, whilst there is a further restructuring under Siam Makro Public.



Berli Jucker (BJC TB) - Canned Recovery in Motion

<ul>
<li>We reiterate a BUY rating for CBG but trim down target price after EPS downward revision to Bt131(-18% from previous TP) based on 35xPE’22E, the average of the Thailand energy</li>
<li>We foresee 4Q21 earnings to drop YoY but improve QoQ supported by (1) recovering sales in Thailand and CLMV market, (2) Solid liquor’s distribution revenue growth</li>
<li>Revised down 2021-22 earnings by 6%-17% to factor in an increase in raw material cost(aluminum coil).</li>
</ul>


We reiterate a BUY rating for CBG but trim down target price after EPS downward revision to Bt131(-18% from previous TP) based on 35xPE’22E, the average of the Thailand energy
We foresee 4Q21 earnings to drop YoY but improve QoQ supported by (1) recovering sales in Thailand and CLMV market, (2) Solid liquor’s distribution revenue growth
Revised down 2021-22 earnings by 6%-17% to factor in an increase in raw material cost(aluminum coil).


CBG: Medium to Long-Term Outlook Remain Solid

Thailand

Carabao Group Public Company Limited is a Thailand-based holding company primarily investing in subsidiaries that produce, market, sell, and distribute energy drinks and other beverages both domestically and internationally. Their product range includes carbonated and non-carbonated energy drinks, vitamin C drinks, coffee products, and drinking water under brands like Carabao, Carabao Sport, and Woody C+ Lock. The company also manufactures and distributes packaging products such as bottles, glass products, and aluminum cans. Headquartered in Bangkok, Thailand, the company was established in 2001.

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Carabao Group (CBG TB)

CBG: Time to Reload

Last week analyst meeting came out with a positive tone regarding 2022-25 earnings outlook. We reiterate our BUY rating for CBG and roll over...

Pi Securities PCL, Thailand

CBG: Expect Earnings to Recover YoY Supported by New Product Launches

We upgrade our recommendation for CBG from HOLD to BUY with a new target price of Bt115 (-9% from previous TP), derived from 35xPE’22E, the average...

Pi Securities PCL, Thailand

CBG: Expect 4Q21 Earnings to Recover QoQ

We reiterate a BUY rating for CBG with a target price of Bt131 based on 35xPE’22E, the average of the Thailand energy drink stocks.

Pi Securities PCL, Thailand

Berli Jucker (BJC TB) - Canned Recovery in Motion

Berli Jucker (BJC TTB) is on the cusp of a strong recovery going into 4Q2021, and even more so in 2021, mainly driven by its retail and packaging...

Angus Mackintosh

CBG: Medium to Long-Term Outlook Remain Solid

We reiterate a BUY rating for CBG but trim down target price after EPS downward revision to Bt131 (-18% from previous TP) based on 35xPE’22E, the...

Pi Securities PCL, Thailand

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