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

<ul><li>1Q25 core profit (excluding a stock gain) declined YoY and QoQ due to a contraction in the GRM.</li><li>We maintain our 2025-27E core profit forecasts (2-year core EPS CAGR of - 6%), based on conservative assumptions for the GRM and higher financial costs to support additional capital expenditures for the Clean Fuel Project (CFP).</li><li>We maintain our Neutral rating with a 12-month fair value of Bt28.00. </li></ul>

1Q25 core profit (excluding a stock gain) declined YoY and QoQ due to a contraction in the GRM.We maintain our 2025-27E core profit forecasts (2-year core EPS CAGR of - 6%), based on conservative assumptions for the GRM and higher financial costs to support additional capital expenditures for the Clean Fuel Project (CFP).We maintain our Neutral rating with a 12-month fair value of Bt28.00. 

Thai Oil - In-Line 1Q25 NP — Contracting GRM; Stock Gain a Key Cushion

<ul><li>We expect 1Q25E core profit (excluding stock gains) to decline YoY and QoQ, mainly due to a correction in the gross refining margin (GRM).</li><li>Accordingly, we have revised down our 2025-27E core profit forecasts by 7-8%, reflecting a more conservative assumption for the GRM.</li><li>Under the new estimates, we forecast negative 2-year core EPS growth at a CAGR of -6%.</li></ul>

We expect 1Q25E core profit (excluding stock gains) to decline YoY and QoQ, mainly due to a correction in the gross refining margin (GRM).Accordingly, we have revised down our 2025-27E core profit forecasts by 7-8%, reflecting a more conservative assumption for the GRM.Under the new estimates, we forecast negative 2-year core EPS growth at a CAGR of -6%.

Thai Oil - Weak GRM and Core Profit in 1Q25E; Downward Revision to 2025-27E Earnings

<ul><li>On February 19, 2025, Samsung E&amp;A (Thailand) Co., Ltd. and Saipem Singapore Pte. Ltd. (the "claimants," which are two of the three companies under the UJV) initiated arbitration proceedings against TOP at the Singapore International Arbitration Centre.</li><li>The dispute concerns TOP’s enforcement of a guarantee against UJV in the amount of USD358mn on January 24, 2025, which the claimants argue was premature and inappropriate.</li><li>They have also filed a claim for damages against TOP (with no further details disclosed).</li></ul>

On February 19, 2025, Samsung E&amp;A (Thailand) Co., Ltd. and Saipem Singapore Pte. Ltd. (the "claimants," which are two of the three companies under the UJV) initiated arbitration proceedings against TOP at the Singapore International Arbitration Centre.The dispute concerns TOP’s enforcement of a guarantee against UJV in the amount of USD358mn on January 24, 2025, which the claimants argue was premature and inappropriate.They have also filed a claim for damages against TOP (with no further details disclosed).

THAI OIL Plc. - Clarification on the Arbitration Process Related to the Clean Fuel Project

<ul><li>4Q24 NP exceeded our expectation by 15%, while 2024 NP was a bit higher (4%) than our estimate.</li><li>The year 2024 performance declined YoY, consistent with the market GIM, along with huge stock losses.</li><li>We maintain our 2025-26E earnings estimates and expect 2-year core EPS growth at a -13% CAGR.</li></ul>

4Q24 NP exceeded our expectation by 15%, while 2024 NP was a bit higher (4%) than our estimate.The year 2024 performance declined YoY, consistent with the market GIM, along with huge stock losses.We maintain our 2025-26E earnings estimates and expect 2-year core EPS growth at a -13% CAGR.

Thai Oil - Upbeat 4Q24 Earnings Due to Hedging Gain; Risks Regarding CFP Remain

<ul><li>The guarantee of USD358mn received by TOP (out of a total of USD483mn) marks a positive development for the CFP (Clean Fuel Project).</li><li>It eases the funding plan for the additional investment required for the CFP, amounting to USD1,776mn, by allowing the company to scale back or delay a bond issuance/loans and reduce interest expenses.</li><li>This is reflected in an upward revision of the net profit estimates for 2025-26E and the new fair value of Bt32.0 (previously Bt27.0).</li></ul>

The guarantee of USD358mn received by TOP (out of a total of USD483mn) marks a positive development for the CFP (Clean Fuel Project).It eases the funding plan for the additional investment required for the CFP, amounting to USD1,776mn, by allowing the company to scale back or delay a bond issuance/loans and reduce interest expenses.This is reflected in an upward revision of the net profit estimates for 2025-26E and the new fair value of Bt32.0 (previously Bt27.0).

Thai Oil - CFP: Eased Funding Plan but Challenges Remain

Thailand

Thai Oil is an integrated energy company engaged in oil refining and petrochemicals, producing a diverse range of products including refined fuels, petrochemicals, and base lubricating oils. It operates one of the leading complex refineries in Asia Pacific with a current capacity of 275,000 barrels per day. The company was founded in 1961 and is headquartered in Bangkok, Thailand.

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Thai Oil (TOP-R TB)

Thai Oil - In-Line 1Q25 NP — Contracting GRM; Stock Gain a Key Cushion

1Q25 core profit (excluding a stock gain) declined YoY and QoQ due to a contraction in the GRM. We maintain our 2025-27E core profit forecasts (2...

Krungthai XSpring

Thai Oil - Weak GRM and Core Profit in 1Q25E; Downward Revision to 2025-27E Earnings

We expect 1Q25E core profit (excluding stock gains) to decline YoY and QoQ, mainly due to a correction in the gross refining margin (GRM).

Krungthai XSpring

Thai Oil - Upbeat 4Q24 Earnings Due to Hedging Gain; Risks Regarding CFP Remain

4Q24 NP exceeded our expectation by 15%, while 2024 NP was a bit higher (4%) than our estimate. The year 2024 performance declined YoY, consistent...

Krungthai XSpring

Thai Oil - CFP: Eased Funding Plan but Challenges Remain

The guarantee of USD358mn received by TOP (out of a total of USD483mn) marks a positive development for the CFP (Clean Fuel Project).

Krungthai XSpring

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Thai Oil - In-Line 1Q25 NP — Contracting GRM; Stock Gain a Key Cushion

1Q25 core profit (excluding a stock gain) declined YoY and QoQ due to a contraction in the GRM. We maintain our 2025-27E core profit forecasts (2...

Krungthai XSpring

Thai Oil - Weak GRM and Core Profit in 1Q25E; Downward Revision to 2025-27E Earnings

We expect 1Q25E core profit (excluding stock gains) to decline YoY and QoQ, mainly due to a correction in the gross refining margin (GRM).

Krungthai XSpring

THAI OIL Plc. - Clarification on the Arbitration Process Related to the Clean Fuel Project

The dispute concerns TOP’s enforcement of a guarantee against UJV in the amount of USD358mn on January 24, 2025, which the claimants argue was...

Krungthai XSpring

Thai Oil - Upbeat 4Q24 Earnings Due to Hedging Gain; Risks Regarding CFP Remain

4Q24 NP exceeded our expectation by 15%, while 2024 NP was a bit higher (4%) than our estimate. The year 2024 performance declined YoY, consistent...

Krungthai XSpring

Thai Oil - CFP: Eased Funding Plan but Challenges Remain

The guarantee of USD358mn received by TOP (out of a total of USD483mn) marks a positive development for the CFP (Clean Fuel Project).

Krungthai XSpring