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.

Equity Bottom-Up

Delta Electronics (Thailand) / Equity Bottom-Up

<ul><li>Delta International Holding Limited (DIH), a subsidiary of Delta Electronics (Taiwan) and a 14.7% shareholder in DELTA, plans to issue zero-coupon exchangeable bonds worth USD525mn to enhance working capital and support future expansion.</li><li>The bonds have a maturity date in 2030 and can be converted into DELTA shares at an initial price of Bt187.6/share (calculated at the reference price plus 40%, implying a reference price of Bt134), which may be subject to adjustment according to the terms and conditions of the bonds.</li><li>The aforementioned transaction regarding the issuance of bonds by DIH has no effect on DELTA's current policies or business operations.</li></ul>

Delta International Holding Limited (DIH), a subsidiary of Delta Electronics (Taiwan) and a 14.7% shareholder in DELTA, plans to issue zero-coupon exchangeable bonds worth USD525mn to enhance working capital and support future expansion.The bonds have a maturity date in 2030 and can be converted into DELTA shares at an initial price of Bt187.6/share (calculated at the reference price plus 40%, implying a reference price of Bt134), which may be subject to adjustment according to the terms and conditions of the bonds.The aforementioned transaction regarding the issuance of bonds by DIH has no effect on DELTA's current policies or business operations.

DELTA TB - Shareholders (DIH) Issued Convertible Bonds Exchangeable for DELTA Shares

<ul><li>We maintain an Underperform rating, as the stock’s valuation appears stretched, with very limited tactical upside.</li><li>However, the long-term outlook on DELTA’s earnings remains strong, driven by robust demand growth in AI-related businesses.</li></ul><ul><li>DELTA reported a 3Q24 net profit of Bt5.91bn (+8.9% YoY but -10.0% QoQ), exceeding market expectations by 3.8%. </li></ul>

We maintain an Underperform rating, as the stock’s valuation appears stretched, with very limited tactical upside.However, the long-term outlook on DELTA’s earnings remains strong, driven by robust demand growth in AI-related businesses.DELTA reported a 3Q24 net profit of Bt5.91bn (+8.9% YoY but -10.0% QoQ), exceeding market expectations by 3.8%. 

Delta Electronics (Thailand) - Strong 3Q24 Net Profit but Share Price Fully Valued

<ul><li>We switch our rating to Underperform (from Neutral) due to a weaker tactical outlook compared to the view presented in our previous report.</li><li>Despite potential upward revisions to our 2024-26E earnings projections to reflect the strong 2Q24 results, our current valuation based on the fundamentals is unlikely to become more attractive.</li><li>DELTA reported a 2Q24 net profit of Bt6.57bn (+40.6% YoY and +52.4% QoQ).</li></ul>

We switch our rating to Underperform (from Neutral) due to a weaker tactical outlook compared to the view presented in our previous report.Despite potential upward revisions to our 2024-26E earnings projections to reflect the strong 2Q24 results, our current valuation based on the fundamentals is unlikely to become more attractive.DELTA reported a 2Q24 net profit of Bt6.57bn (+40.6% YoY and +52.4% QoQ).

Delta Electronics - Record-High Net Profit in 2Q24 but Share Price Fully Valued

<ul><li>We initiate our coverage on DELTA with a Neutral rating and a 12M fair value of Bt60.25, based on a required rate of return of 2.29%, as we view the current valuation to be unfavorable.</li><li>However, our model suggests that an upward rerating is possible in the medium term — our FY2025E and FY2026E fair values are Bt79.25 and Bt96.00, respectively.</li><li>We expect flat core profit growth YoY in FY2024E at Bt17bn, as the increase in sales will likely be offset by production ramp-up costs, which follows the patterns evident in DELTA’s last two factory openings in 2019 and 2021.</li></ul>

We initiate our coverage on DELTA with a Neutral rating and a 12M fair value of Bt60.25, based on a required rate of return of 2.29%, as we view the current valuation to be unfavorable.However, our model suggests that an upward rerating is possible in the medium term — our FY2025E and FY2026E fair values are Bt79.25 and Bt96.00, respectively.We expect flat core profit growth YoY in FY2024E at Bt17bn, as the increase in sales will likely be offset by production ramp-up costs, which follows the patterns evident in DELTA’s last two factory openings in 2019 and 2021.

Delta Electronics (Thailand) - Potential for Rerating of Valuation in FY2025E and FY2026E

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

<ul>
<li>We downgrade to SELL from HOLD and lower TP to Bt434 (-9% from previous TP) from Bt475, based on 38.6xPE’23E (average of 5-year trading).Analyst meeting came with a neutral tone. </li>
<li>Analyst meeting details Raw material shortage situation has improved,but some areas (MOSFETs,ICs, high-voltage materials) remain tight.The situation is unlikely to return to pre-Covid levels until at least end of 1H23</li>
<li>Factory 8, the new facility dedicated to support EV product segment growth, will likely be up and running by 2H23. In addition to more sales contribution DELTA’s gross margin</li>
</ul>


We downgrade to SELL from HOLD and lower TP to Bt434 (-9% from previous TP) from Bt475, based on 38.6xPE’23E (average of 5-year trading).Analyst meeting came with a neutral tone. 
Analyst meeting details Raw material shortage situation has improved,but some areas (MOSFETs,ICs, high-voltage materials) remain tight.The situation is unlikely to return to pre-Covid levels until at least end of 1H23
Factory 8, the new facility dedicated to support EV product segment growth, will likely be up and running by 2H23. In addition to more sales contribution DELTA’s gross margin


DELTA : Expensive Valuation and Recession Impact

Thailand

Delta Electronics (Thailand) Public Co. Ltd. manufactures and distributes power supplies, electronic equipment, and components such as DC fans, EMI filters, and solenoids. The company also provides solutions including EV chargers, industrial automation, data center infrastructure, and smart energy management. Headquartered in Samut Prakan, Thailand, the company was established in 1988.

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Delta Electronics (Thailand) (DELTA TB)

DELTA TB - Shareholders (DIH) Issued Convertible Bonds Exchangeable for DELTA Shares

Delta International Holding Limited (DIH), a subsidiary of Delta Electronics (Taiwan) and a 14.7% shareholder in DELTA, plans to issue zero-coupon...

Krungthai XSpring

Delta Electronics (Thailand) - Potential for Rerating of Valuation in FY2025E and FY2026E

We initiate our coverage on DELTA with a Neutral rating and a 12M fair value of Bt60.25, based on a required rate of return of 2.29%, as we view...

Krungthai XSpring

DELTA : Expensive Valuation and Recession Impact

We downgrade to SELL from HOLD and lower TP to Bt434 (-9% from previous TP) from Bt475, based on 38.6xPE’23E (average of 5-year trading). Analyst...

Pi Securities PCL, Thailand

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

DELTA TB - Shareholders (DIH) Issued Convertible Bonds Exchangeable for DELTA Shares

Delta International Holding Limited (DIH), a subsidiary of Delta Electronics (Taiwan) and a 14.7% shareholder in DELTA, plans to issue zero-coupon...

Krungthai XSpring

Delta Electronics (Thailand) - Strong 3Q24 Net Profit but Share Price Fully Valued

We maintain an Underperform rating, as the stock’s valuation appears stretched, with very limited tactical upside. However, the long-term outlook...

Krungthai XSpring

Delta Electronics - Record-High Net Profit in 2Q24 but Share Price Fully Valued

We switch our rating to Underperform (from Neutral) due to a weaker tactical outlook compared to the view presented in our previous report.

Krungthai XSpring

Delta Electronics (Thailand) - Potential for Rerating of Valuation in FY2025E and FY2026E

We initiate our coverage on DELTA with a Neutral rating and a 12M fair value of Bt60.25, based on a required rate of return of 2.29%, as we view...

Krungthai XSpring

DELTA : Expensive Valuation and Recession Impact

We downgrade to SELL from HOLD and lower TP to Bt434 (-9% from previous TP) from Bt475, based on 38.6xPE’23E (average of 5-year trading). Analyst...

Pi Securities PCL, Thailand