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>Technically, the SET Index is expected to move sideways down, with the support at 1,370/1,364 points and the resistance at 1,383/1,390 points (25-day EMA), as the technical movement continued to fluctuate sideways for a fourth day after the index jumped more than 20 points in the middle of last week.</li><li>The FOMC meeting is anticipated to maintain the fed funds rate, with market attention focused on the post-meeting message from Fed Chairman Powell regarding the outlook for potential rate cuts.</li><li>The Fed may signal the first rate cut later than the market anticipates.</li></ul>

Technically, the SET Index is expected to move sideways down, with the support at 1,370/1,364 points and the resistance at 1,383/1,390 points (25-day EMA), as the technical movement continued to fluctuate sideways for a fourth day after the index jumped more than 20 points in the middle of last week.The FOMC meeting is anticipated to maintain the fed funds rate, with market attention focused on the post-meeting message from Fed Chairman Powell regarding the outlook for potential rate cuts.The Fed may signal the first rate cut later than the market anticipates.

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 reiterate our BUY rating with a target price of Bt14.5, derived from 25xPE’22E, which is its five-years average trading range, implying a 25%premium to the world consumer discretionary sector.</li>
<li>We expect AUCT to report 4Q21 net profit of Bt70m (+7%YoY,+16%QoQ) supported by seasonal factor and a rise in NPLs as a consequence of the impact from COVID-19. In 3Q21</li>
<li>Statistically, number of auctioned vehicles have a strong correlation with NPL ratio for auto loans. Bank of Thailand (BOT) reported number of NPL ratio for auto loans increased to 1.72% </li>
</ul>


We reiterate our BUY rating with a target price of Bt14.5, derived from 25xPE’22E, which is its five-years average trading range, implying a 25%premium to the world consumer discretionary sector.
We expect AUCT to report 4Q21 net profit of Bt70m (+7%YoY,+16%QoQ) supported by seasonal factor and a rise in NPLs as a consequence of the impact from COVID-19. In 3Q21
Statistically, number of auctioned vehicles have a strong correlation with NPL ratio for auto loans. Bank of Thailand (BOT) reported number of NPL ratio for auto loans increased to 1.72% 


AUCT: Expect Auction Volume Hit the Record High in 4Q21

<p><strong>We reiterate our BUY rating with a target price of Bt15.75 derived from 25xPE’22E, which is its five-years average trading range, implying a 25% premium to the world consumer discretionary sector.</strong></p><div>• We expect AUCT to report 2Q21 net profit of Bt59m (-17%YoY, -15%QoQ) caused by lower-than-expected auctioned volume as a result in delay in vehicle seizing activity in 4Q20 due to the debt relief measure.</div><div></div><div>• Statistically, number of auctioned vehicles have a strong correlation with NPL ratio. In 1Q21, BOT reported number of NPLs ratio increased to 1.56% from 1.44% in 4Q20. We expect auction volume will continue to increase in 2H21 supported by a rise in NPLs as a consequence of the impact from 3rd wave of COVID-19.</div><div></div><div>• The special mention ratio (SM) remain high level at between 9.2%-9.75% in 1Q20-1Q21. This implies that NPL will rise after the maturity of debt moratorium measure implemented by Bank of Thailand. Therefore, we expect auctioned vehicle volume to accelerate in 2H21.  </div>

We reiterate our BUY rating with a target price of Bt15.75 derived from 25xPE’22E, which is its five-years average trading range, implying a 25% premium to the world consumer discretionary sector.• We expect AUCT to report 2Q21 net profit of Bt59m (-17%YoY, -15%QoQ) caused by lower-than-expected auctioned volume as a result in delay in vehicle seizing activity in 4Q20 due to the debt relief measure.• Statistically, number of auctioned vehicles have a strong correlation with NPL ratio. In 1Q21, BOT reported number of NPLs ratio increased to 1.56% from 1.44% in 4Q20. We expect auction volume will continue to increase in 2H21 supported by a rise in NPLs as a consequence of the impact from 3rd wave of COVID-19.• The special mention ratio (SM) remain high level at between 9.2%-9.75% in 1Q20-1Q21. This implies that NPL will rise after the maturity of debt moratorium measure implemented by Bank of Thailand. Therefore, we expect auctioned vehicle volume to accelerate in 2H21.  

AUCT: Expect 2Q21 Earnings Should Be the Bottom Quarter of the Year

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

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<p><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> released a stellar set of 1Q2021 results, with revenue growth of +37.3% YoY, and net profit growth of +27.1% YoY, which continued to reflect better than expected growth in its end-to-end logistics business, and notably Anteraja, its last-mile delivery service.</p>
</div>
<p>The company's three pillars including transport, car auction, and end-to-end logistics, all registered strong growth. The company's last-mile express delivery service Anteraja saw especially strong growth driven by the e-commerce ecosystem as it is providing deliveries for most of the major players. </p>
<p>Anteraja's continues to expand its business, with daily parcel deliveries hitting 500,000 in 1Q2021 and targets 700,000-750,000 parcels a day by the end of the year.</p>
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<section class="figure"><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a>'s auction business also recorded positive revenue growth of +3.8%  in 1Q2021 but has seen a recent pick up in growth. </section>
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<section class="figure"><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener"></a>The company continues to develop its app-based businesses such as Share Car and used car marketplace, Caroline.</section>
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<p><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> targets revenue growth 0f +20%-25% for 2021 mainly driven by the growth from end-to-end logistics and specifically Anteraja, together with e-commerce sharing warehouse Titipaja. </p>
</div>
<p>The company also recently had its rights issue of zero-coupon convertible bonds approved, which will raise a total of IDR720bn. This will help the company reduce the debt used to expand its logistics businesses over the past year.</p>
<p>We continue to believe in the <a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> digital transformation story, with ongoing synergies between the three pillars of its business.</p>
<p><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> trades on 10.9x FY21E EV/EBITDA and 8.7x FY22E EV/EBITDA and an FY22E PER of 30x but we expect continuing momentum behind the growth and rising profitability story, as Anteraja gains scale and grows its revenues.</p>
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Adi Sarana Armada (ASSA IJ) released a stellar set of 1Q2021 results, with revenue growth of +37.3% YoY, and net profit growth of +27.1% YoY, which continued to reflect better than expected growth in its end-to-end logistics business, and notably Anteraja, its last-mile delivery service.

The company's three pillars including transport, car auction, and end-to-end logistics, all registered strong growth. The company's last-mile express delivery service Anteraja saw especially strong growth driven by the e-commerce ecosystem as it is providing deliveries for most of the major players. 
Anteraja's continues to expand its business, with daily parcel deliveries hitting 500,000 in 1Q2021 and targets 700,000-750,000 parcels a day by the end of the year.

Adi Sarana Armada (ASSA IJ)'s auction business also recorded positive revenue growth of +3.8%  in 1Q2021 but has seen a recent pick up in growth. 



The company continues to develop its app-based businesses such as Share Car and used car marketplace, Caroline.





Adi Sarana Armada (ASSA IJ) targets revenue growth 0f +20%-25% for 2021 mainly driven by the growth from end-to-end logistics and specifically Anteraja, together with e-commerce sharing warehouse Titipaja. 

The company also recently had its rights issue of zero-coupon convertible bonds approved, which will raise a total of IDR720bn. This will help the company reduce the debt used to expand its logistics businesses over the past year.
We continue to believe in the Adi Sarana Armada (ASSA IJ) digital transformation story, with ongoing synergies between the three pillars of its business.
Adi Sarana Armada (ASSA IJ) trades on 10.9x FY21E EV/EBITDA and 8.7x FY22E EV/EBITDA and an FY22E PER of 30x but we expect continuing momentum behind the growth and rising profitability story, as Anteraja gains scale and grows its revenues.






Adi Sarana Armada (ASSA IJ) - End-To End Aspirations on Track

<p><strong>We upgrade AUCT from HOLD to BUY with a target price of Bt15.75 (Previous TP: Bt10), derived from 25xPE’22E, which is its five-years average trading range, implying a 25% premium to the world consumer discretionary sector. Our new target price based on 2022E earnings along with re-rating PE multiple to factor in growing NPL in the market.</strong></p><div>• Statistically, number of auctioned vehicles have a strong correlation with NPL ratio. In 1Q21, BOT reported number of NPLs ratio increased to 1.56% from 1.44% in 4Q20. We expect auction volume will continue to increase in 2H21 supported by a rise in NPLs as a consequence of the impact from 3rd wave of COVID-19.</div><div></div><div>• The special mention ratio (SM) remain high level at between 9.2%-9.75% in 1Q20-1Q21. This implies that NPL will rise after the maturity of debt moratorium measure implemented by Bank of Thailand. Therefore, we expect auctioned vehicle volume to accelerate in 2H21.</div><div></div><div>• However, we expect 2Q21 performance to drop both YoY and QoQ due to lower-than-expected auctioned volume as a result in delay in vehicle seizing activity in 4Q20 due to the debt relief measure.</div><div></div><div>• Revise up 2022E earnings forecast by 21%.</div>

We upgrade AUCT from HOLD to BUY with a target price of Bt15.75 (Previous TP: Bt10), derived from 25xPE’22E, which is its five-years average trading range, implying a 25% premium to the world consumer discretionary sector. Our new target price based on 2022E earnings along with re-rating PE multiple to factor in growing NPL in the market.• Statistically, number of auctioned vehicles have a strong correlation with NPL ratio. In 1Q21, BOT reported number of NPLs ratio increased to 1.56% from 1.44% in 4Q20. We expect auction volume will continue to increase in 2H21 supported by a rise in NPLs as a consequence of the impact from 3rd wave of COVID-19.• The special mention ratio (SM) remain high level at between 9.2%-9.75% in 1Q20-1Q21. This implies that NPL will rise after the maturity of debt moratorium measure implemented by Bank of Thailand. Therefore, we expect auctioned vehicle volume to accelerate in 2H21.• However, we expect 2Q21 performance to drop both YoY and QoQ due to lower-than-expected auctioned volume as a result in delay in vehicle seizing activity in 4Q20 due to the debt relief measure.• Revise up 2022E earnings forecast by 21%.

AUCT: Auctioned Vehicle Volumes Grow in Line with Rising NPL Trend

Thailand

Union Auction Public Company Limited is a Thailand-based company specializing in providing auction services for a variety of assets. The company primarily auctions automobiles and motorcycles, often those seized by financial institutions, and has expanded to include other assets like land, houses, furniture, and brand-name products. Established in 1991, Union Auction is headquartered in Bangkok, Thailand.

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Union Auction (AUCT TB)

Keep a Close Watch on US FOMC Meeting

Technically, the SET Index is expected to move sideways down, with the support at 1,370/1,364 points and the resistance at 1,383/1,390 points...

Krungthai XSpring

AUCT: Expect Auction Volume Hit the Record High in 4Q21

We reiterate our BUY rating with a target price of Bt14.5, derived from 25xPE’22E, which is its five-years average trading range, implying a 25%...

Pi Securities PCL, Thailand

AUCT: Expect 2Q21 Earnings Should Be the Bottom Quarter of the Year

We reiterate our BUY rating with a target price of Bt15.75 derived from 25xPE’22E, which is its five-years average trading range, implying a 25%...

Pi Securities PCL, Thailand

Adi Sarana Armada (ASSA IJ) - End-To End Aspirations on Track

ASSA remains a high-growth Indonesian transport and logistics player, which is increasingly driven by the rapid growth of its last-mile delivery...

Angus Mackintosh

AUCT: Auctioned Vehicle Volumes Grow in Line with Rising NPL Trend

We upgrade AUCT from HOLD to BUY with a target price of Bt15.75 (Previous TP: Bt10), derived from 25xPE’22E, which is its five-years average...

Pi Securities PCL, Thailand

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