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

<p><strong>We reiterate BUY rating with a target price of Bt23.0, derived from 20xPE’21E which equal to World Consumer Staple sector.</strong></p><div>• We expect PTG net profit at Bt530m in 1Q21E (+161%YoY, -21%QoQ), mainly supported YoY by strong marketing margin and sales volume growth.</div><div></div><div>• We forecast sales volume at 1,339 m.Litre in 1Q21E (+10%YoY, +3%QoQ), due to resilient diesel demand. Meanwhile, marketing margin remains high at Bt1.9/Litre (+9%YoY, -2%QoQ).</div><div></div><div>• We expect Covid-19 spread will have limited impact as PTG’s customers are in logistic sector while marketing margin is rising in April. Also, its coffee shop will benefit from new hemp-products.</div><div></div><div>• We also foresee an upside risk from higher than expected marketing margin and upside from power plant investment.</div>

We reiterate BUY rating with a target price of Bt23.0, derived from 20xPE’21E which equal to World Consumer Staple sector.• We expect PTG net profit at Bt530m in 1Q21E (+161%YoY, -21%QoQ), mainly supported YoY by strong marketing margin and sales volume growth.• We forecast sales volume at 1,339 m.Litre in 1Q21E (+10%YoY, +3%QoQ), due to resilient diesel demand. Meanwhile, marketing margin remains high at Bt1.9/Litre (+9%YoY, -2%QoQ).• We expect Covid-19 spread will have limited impact as PTG’s customers are in logistic sector while marketing margin is rising in April. Also, its coffee shop will benefit from new hemp-products.• We also foresee an upside risk from higher than expected marketing margin and upside from power plant investment.

<p><strong>Analyst meeting came out with positive tone. Oil sale volume in 1Q21 remains solid while marketing margin is at high level.</strong></p><div>• We have a positive view on PTG performance in 2021, mainly due to a growth in oil volume, strong marketing margin at Bt1.8-1.9/Litre and ongoing growth in non-oil segments.</div><div></div><div>• We also foresee a upside from business expansion in waste-to-energy power plant and EV chargers in 2H21-2022.</div><div></div><div>• We revise earnings in 2021 up by 5% as we conservatively upgrade margin up to Bt1.8/litre.</div><div></div><div><strong>We reiterate BUY rating with a new target price at Bt23.0 (from Bt21.6), derived from 20xPE’21E which equal to World Consumer Staple sector.</strong></div>

Analyst meeting came out with positive tone. Oil sale volume in 1Q21 remains solid while marketing margin is at high level.• We have a positive view on PTG performance in 2021, mainly due to a growth in oil volume, strong marketing margin at Bt1.8-1.9/Litre and ongoing growth in non-oil segments.• We also foresee a upside from business expansion in waste-to-energy power plant and EV chargers in 2H21-2022.• We revise earnings in 2021 up by 5% as we conservatively upgrade margin up to Bt1.8/litre.We reiterate BUY rating with a new target price at Bt23.0 (from Bt21.6), derived from 20xPE’21E which equal to World Consumer Staple sector.

PTG: Good Outlook as Marketing Margin Remains High

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

PTT Oil & Retail Business  / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/ptt-oil-and-retail" target="_blank" data-smartkarma-citation="entities:28939:1" rel="noopener">PTT Oil and Retail (OR TB)</a>/PTTOR is the flagship company for the oil and retail business of <a href="https://www.smartkarma.com/entities/ptt-pcl" target="_blank" data-smartkarma-citation="entities:197:1" rel="noopener">PTT PCL (PTT TB)</a> in Thailand and in the Southeast Asia region such as Cambodia, Laos, Myanmar and Philippines. PTTOR is the largest player in Thailand’s fuel retail market. PTTOR priced its IPO at THB18.00 per share, at the upper end of its IPO price range of THB16.00-18.00 per share. The shares are set to start trading on Thursday, 11 February. </p></div><div>
<p>In <a href="https://www.smartkarma.com/insights/ptt-oil-and-retail-pttor-ipo-initiation-octane-ratings" target="_blank" data-smartkarma-citation="insights:46230" rel="noopener">PTT Oil and Retail (PTTOR) IPO Initiation: Octane Ratings</a>, we stated that PTTOR remains a market-leading business and well-placed to ride the recovery in oil prices, easing of lockdown restrictions and consumer confidence.</p>
<div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/ptt-oil-and-retail-pttor-ipo-valuation-insights" target="_blank" data-smartkarma-citation="insights:47147" rel="noopener">PTT Oil and Retail (PTTOR) IPO: Valuation Insights</a>, we opined that a reasonable P/E valuation and solid cornerstone support makes PTTOR tempting at the proposed pricing range. Our base-case DCF derived price target of THB22.20 per share. Our valuation analysis shows that the IPO price remains attractive.</p></div>
</div>

PTT Oil and Retail (OR TB)/PTTOR is the flagship company for the oil and retail business of PTT PCL (PTT TB) in Thailand and in the Southeast Asia region such as Cambodia, Laos, Myanmar and Philippines. PTTOR is the largest player in Thailand’s fuel retail market. PTTOR priced its IPO at THB18.00 per share, at the upper end of its IPO price range of THB16.00-18.00 per share. The shares are set to start trading on Thursday, 11 February. 
In PTT Oil and Retail (PTTOR) IPO Initiation: Octane Ratings, we stated that PTTOR remains a market-leading business and well-placed to ride the recovery in oil prices, easing of lockdown restrictions and consumer confidence.
In PTT Oil and Retail (PTTOR) IPO: Valuation Insights, we opined that a reasonable P/E valuation and solid cornerstone support makes PTTOR tempting at the proposed pricing range. Our base-case DCF derived price target of THB22.20 per share. Our valuation analysis shows that the IPO price remains attractive.


PTT Oil and Retail (PTTOR) IPO: Trading Debut

<p><strong>We reiterate BUY rating with the target price at Bt21.6, derived from 19.9xPE’21E which equal to World Consumer Discretionary sector.</strong></p><div>• Expect net profit  in 4Q20E to reach the record levels at Bt552m supported by strong marketing margin, sales volume growth and better contribution from Biodiesel business.</div><div></div><div>• In short-term, we expect a QoQ decline in 1Q21 earnings caused by new wave of Covid-19 which could drag both marketing margin and sales volume.</div><div></div><div>• Meanwhile, we expect the company to report 2020E earnings at Bt1.78bn (+14%YoY).</div><div></div><div>• However, our 2021E forecast is subject to revision after result announcement in February 21. We expect no significant change in our target price.</div>

We reiterate BUY rating with the target price at Bt21.6, derived from 19.9xPE’21E which equal to World Consumer Discretionary sector.• Expect net profit  in 4Q20E to reach the record levels at Bt552m supported by strong marketing margin, sales volume growth and better contribution from Biodiesel business.• In short-term, we expect a QoQ decline in 1Q21 earnings caused by new wave of Covid-19 which could drag both marketing margin and sales volume.• Meanwhile, we expect the company to report 2020E earnings at Bt1.78bn (+14%YoY).• However, our 2021E forecast is subject to revision after result announcement in February 21. We expect no significant change in our target price.

PTG: 4Q20 Earnings Will Be the Peak Quarter

<div><p><a href="https://www.smartkarma.com/entities/ptt-oil-and-retail" target="_blank" data-smartkarma-citation="entities:28939:1" rel="noopener">PTT Oil and Retail (OR TB)</a>/PTTOR is the flagship company for the oil and retail business of <a href="https://www.smartkarma.com/entities/ptt-pcl" target="_blank" data-smartkarma-citation="entities:197:1" rel="noopener">PTT PCL (PTT TB)</a> in Thailand and in the Southeast Asia region such as Cambodia, Laos, Myanmar and Philippines. PTTOR is the largest player in Thailand’s fuel retail market.</p></div><div><p>PTTOR has launched its IPO at a price range of THB16.00-18.00 per share to raise as much as THB47.0 billion ($1.6 billion). Cornerstone investors will account for around two-thirds of the offer shares. Nine international cornerstones which include Fidelity, JP Morgan Asset Management and GIC will take up $270 million of the offer shares. Nineteen domestic cornerstone investors will take up $758 million of the offer shares. The books will open on 22 January and the first day of trading is set for 11 February. </p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/ptt-oil-and-retail-pttor-ipo-initiation-octane-ratings" target="_blank" data-smartkarma-citation="insights:46230" rel="noopener">PTT Oil and Retail (PTTOR) IPO Initiation: Octane Ratings</a>, we stated that PTTOR remains a market-leading business and well-placed to ride the recovery in oil prices, easing of lockdown restrictions and consumer confidence. Overall, we think that a reasonable P/E valuation and solid cornerstone support makes PTTOR tempting at the proposed pricing range. </p></div></div></div>

PTT Oil and Retail (OR TB)/PTTOR is the flagship company for the oil and retail business of PTT PCL (PTT TB) in Thailand and in the Southeast Asia region such as Cambodia, Laos, Myanmar and Philippines. PTTOR is the largest player in Thailand’s fuel retail market.PTTOR has launched its IPO at a price range of THB16.00-18.00 per share to raise as much as THB47.0 billion ($1.6 billion). Cornerstone investors will account for around two-thirds of the offer shares. Nine international cornerstones which include Fidelity, JP Morgan Asset Management and GIC will take up $270 million of the offer shares. Nineteen domestic cornerstone investors will take up $758 million of the offer shares. The books will open on 22 January and the first day of trading is set for 11 February. In PTT Oil and Retail (PTTOR) IPO Initiation: Octane Ratings, we stated that PTTOR remains a market-leading business and well-placed to ride the recovery in oil prices, easing of lockdown restrictions and consumer confidence. Overall, we think that a reasonable P/E valuation and solid cornerstone support makes PTTOR tempting at the proposed pricing range. 

PTT Oil and Retail (PTTOR) IPO: Valuation Insights

Thailand

PTG Energy Public Company Limited consists of eight groups of businesses as follows: 1) Oil (the Company's core and original business) and Retail Business, 2) LPG Business, 3) Renewable Energy and Investment Business, 4) Logistics Business, 5) System and Equipment Management Business , 6) Food and Beverage Business 7) Auto Care and Maintenance Business, and 8) Electronic Money Business (e-Money). In this regard, the Company is determined to operate the business with the aim of satisfying consumers' needs in a comprehensive manner.

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PTG Energy PCL (PTG TB)

PTG: Expect Resilient Earnings in 1Q21

We reiterate BUY rating with a target price of Bt23.0, derived from 20xPE’21E which equal to World Consumer Staple sector.

Pi Securities PCL, Thailand

PTG: Good Outlook as Marketing Margin Remains High

Analyst meeting came out with positive tone. Oil sale volume in 1Q21 remains solid while marketing margin is at high level.

Pi Securities PCL, Thailand

PTT Oil and Retail (PTTOR) IPO: Trading Debut

PTTOR priced its IPO at THB18.00 per share and the shares are set to start trading on 11 February. Our valuation analysis shows that the IPO price...

Arun George

PTG: 4Q20 Earnings Will Be the Peak Quarter

We reiterate BUY rating with the target price at Bt21.6, derived from 19.9xPE’21E which equal to World Consumer Discretionary sector.

Pi Securities PCL, Thailand

PTT Oil and Retail (PTTOR) IPO: Valuation Insights

PTTOR has launched its IPO to raise as much as THB47.0 billion ($1.6 billion). A reasonable P/E valuation and solid cornerstone support make PTTOR...

Arun George

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