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

Total Access Communication / Equity Bottom-Up

<ul>
<li>We maintain our HOLD rating and TP of Bt47.76,based on DTAC’s tender offer price. The NBTC voted 3:2 in favor of allowing the merger to take place under certain conditions</li>
<li>The NBTC approved the TRUE-DTAC merger According to the Bangkok Post (dated 22 Oct), measures on the merger include 1) separation of brand and services for the first 3 years </li>
<li>Once TRUE and DTAC receive the official letter stating the conditions,they will enter the VTO phase.Assuming everything goes according to plan,the remaining processes will take roughly 3 months to complete.</li>
</ul>


We maintain our HOLD rating and TP of Bt47.76,based on DTAC’s tender offer price. The NBTC voted 3:2 in favor of allowing the merger to take place under certain conditions
The NBTC approved the TRUE-DTAC merger According to the Bangkok Post (dated 22 Oct), measures on the merger include 1) separation of brand and services for the first 3 years 
Once TRUE and DTAC receive the official letter stating the conditions,they will enter the VTO phase.Assuming everything goes according to plan,the remaining processes will take roughly 3 months to complete.


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.

Thematic (Sector/Industry)

<ul><li>We expect the SET Index to move up, with the support at 1,555/1,530 points and the resistance at 1,600/1,616 points, on the back of foreign investors’ short covering and the risk-on mode for risk assets.</li><li>This is based on the assumption that the Fed will slow down its interest rate hikes from September onward after inflation already peaked out on a MoM basis following lower commodity prices and the US economy entered a technical recession.</li><li>Investment strategy: Buy blue chip stocks whose prices have fallen since June and stocks expected to report good earnings results: We recommend JMT, JMART, SINGER, MTC, COM7, FORTH, CRC, DTAC, MEGA and EA.</li></ul>

We expect the SET Index to move up, with the support at 1,555/1,530 points and the resistance at 1,600/1,616 points, on the back of foreign investors’ short covering and the risk-on mode for risk assets.This is based on the assumption that the Fed will slow down its interest rate hikes from September onward after inflation already peaked out on a MoM basis following lower commodity prices and the US economy entered a technical recession.Investment strategy: Buy blue chip stocks whose prices have fallen since June and stocks expected to report good earnings results: We recommend JMT, JMART, SINGER, MTC, COM7, FORTH, CRC, DTAC, MEGA and EA.

<ul>
<li>We maintain our HOLD rating and TP of Bt47.60 based on DTAC’s tender offer price. Conference call came with negative tone, as management lowered its guidance on core service revenue </li>
<li>2Q22 core profit was below expectation 2Q22 net profit was at Bt1bn (-34% YoY, +38% QoQ), growing QoQ due to a one-time Bt1bn deductible granted by the NBTC</li>
<li>Excluding extraordinary items, 2Q22 core profit should be at Bt573m, 33% below our forecast, declining both QoQ and YoY due to losses in subsidizing handset sales to attract subscribers.</li>
</ul>


We maintain our HOLD rating and TP of Bt47.60 based on DTAC’s tender offer price. Conference call came with negative tone, as management lowered its guidance on core service revenue 
2Q22 core profit was below expectation 2Q22 net profit was at Bt1bn (-34% YoY, +38% QoQ), growing QoQ due to a one-time Bt1bn deductible granted by the NBTC
Excluding extraordinary items, 2Q22 core profit should be at Bt573m, 33% below our forecast, declining both QoQ and YoY due to losses in subsidizing handset sales to attract subscribers.


DTAC : Better 2H22 Outlook from Tourism Recovery

<ul>
<li>We maintain our HOLD rating and TP of Bt47.60 based on DTAC’s tender offer price. We believe the company will benefit from seasonal low costs despite weak sales performance. </li>
<li>Expect QoQ improvement in 2Q22 net profit : We expect 2Q22 net profit to be at Bt854m (-44% YoY, +18% QoQ) as a result of seasonal low costs. </li>
<li>We expect 2Q22 revenue at Bt19bn (flat YoY, -4% QoQ). Top-line performance continues to struggle YoY and QoQ due to weak economic activity.</li>
</ul>


We maintain our HOLD rating and TP of Bt47.60 based on DTAC’s tender offer price. We believe the company will benefit from seasonal low costs despite weak sales performance. 
Expect QoQ improvement in 2Q22 net profit : We expect 2Q22 net profit to be at Bt854m (-44% YoY, +18% QoQ) as a result of seasonal low costs. 
We expect 2Q22 revenue at Bt19bn (flat YoY, -4% QoQ). Top-line performance continues to struggle YoY and QoQ due to weak economic activity.


DTAC : Lower Costs Will Improve Earnings in 2Q22

<ul>
<li>DTAC and TRUE notified the SET of a potential merger and will create a non-binding memorandum of understanding. The deal will involve a share-swap model, where DTAC shareholders can either </li>
<li>We believe accepting the tender offer is the best course of action for short-term oriented shareholders, due to the time-consuming nature of the deal and the potential lingering cost structure </li>
<li>Deal of merger must still undergo approval from board of directors and shareholders of both companies and key regulatory agencies.</li>
</ul>


DTAC and TRUE notified the SET of a potential merger and will create a non-binding memorandum of understanding. The deal will involve a share-swap model, where DTAC shareholders can either 
We believe accepting the tender offer is the best course of action for short-term oriented shareholders, due to the time-consuming nature of the deal and the potential lingering cost structure 
Deal of merger must still undergo approval from board of directors and shareholders of both companies and key regulatory agencies.


DTAC: Merger with TRUE Will Expand Its Value

Thailand

Total Access Communication Public Company Limited provides cellular mobile telephone services under WorldPhone 800 and WorldPhone 1800 brand names throughout Thailand. The Company also sells cellular handsets and other telecommunications equipment through its WorldMedia network of retail stores.

Total Access Communication (DTAC TB)

DTAC : 3Q22 Results Lower than Expected

We maintain our HOLD rating and TP of Bt47.76, based on DTAC’s tender offer price. The NBTC voted 3:2 in favor of allowing the merger to take place...

Pi Securities PCL, Thailand

Monthly Report - August 2022

We expect the SET Index to move up, with the support at 1,555/1,530 points and the resistance at 1,600/1,616 points, on the back of foreign...

Krungthai XSpring

DTAC : Better 2H22 Outlook from Tourism Recovery

We maintain our HOLD rating and TP of Bt47.60 based on DTAC’s tender offer price. Conference call came with negative tone,as management lowered its...

Pi Securities PCL, Thailand

DTAC : Lower Costs Will Improve Earnings in 2Q22

We maintain our HOLD rating and TP of Bt47.60 based on DTAC’s tender offer price. We believe the company will benefit from seasonal low costs...

Pi Securities PCL, Thailand

DTAC: Merger with TRUE Will Expand Its Value

DTAC and TRUE notified the SET of a potential merger and will create a non-binding memorandum of understanding. The deal will involve a share-swap...

Pi Securities PCL, Thailand