THAILAND’s TOP LOCAL KNOWLEDGE Current Market
Monday, November 13, 2017
Net Trade
Market data
Close
%∆
SET Index
1,689.3
-0.8%
Turnover (Bt m)
57,092
3.7%
Mkt Cap (Bt bn)
16,754
-0.8%
358
stocks
1,071
stocks
Stock Gainers Stock Losers
Net Trade (Bt bn)
SET Index vs MSCI Asia x JP Prev.
-1M
YTD
Foreign
-2.7
-18.8
-6.5
Retail
+3.0
+14.0
-72.3
Institutes
-0.6
+4.0
+67.3
Proprietary
+0.3
+0.8
+11.6
Note: Data for SET Market only
(index) 1,800 1,700 1,600 1,500 1,400 1,300 1,200 1,100 Jan-16
MSCI Asia x JP (RHS)
Aug-16
Mar-17
750 700 650 600 550 500 450 400
Oct-17
Market Valuation
TOP STORY
Market data
Thanachart Securities
(index)
SET index (LHS)
2017F
2018F
2019F
BCPG (SELL) | Overvalued
PE (x)
16.5
14.9
13.5
▪ We initiate coverage on BCPG with a SELL rating and TP of Bt21/share. We
Norm EPS growth (%)
10.1
10.2
9.6
EV/EBITDA (x)
10.5
9.4
8.7
P/BV (x)
2.0
1.9
1.7
Yield (%)
3.0
3.4
3.7
ROE (%)
13.0
13.5
13.7
0.5
0.4
0.4
Close
∆
%∆ -0.2%
believe BCPG’s valuation is expensive as our TP already includes potential future projects and a tariff increase for its geothermal projects. These two factors are valued at Bt4/share in our TP. Also, we expect its earnings growth to slow down after 2018F.
Results Comment AMATAV (BUY)
▪
AP (BUY)
▪
Good 3Q17 results, in line with consensus
BDMS (HOLD)
▪
3Q17 earnings were better than expected
COL (SELL)
▪
3Q17 earnings were below our expectation
EA (BUY)
▪
ERW (BUY)
▪
Strong 3Q17 results, in-line
ESSO (BUY)
▪
3Q17 a strong beat
JAS (SELL)
▪
Weak 3Q17 earnings, below our expectation
MAJOR (BUY)
▪
Softened 3Q17 results as we’d expected
MAKRO (SELL)
▪
PYLON (HOLD)
▪
RJH (BUY) ROBINS (BUY) SAPPE (SELL) STA (BUY) STEC (BUY) SUSCO (BUY) SVI (SELL) WHA (BUY)
Better-than-expected 3Q17 profit
3Q17 results in line
In-line 3Q17 results Weaker-than-expected 3Q17 results
▪
Very strong 3Q17 results, above expectation
▪
Good 3Q17 results, in line
▪
Good 3Q17 in-line
▪
Norm loss 3Q17 results
Major Indices Dow Jones
23,422
-39.7
NASDAQ
6,751
0.9
0.0%
FTSE
7,433
-51.1
-0.7%
SHCOMP (China)
3,433
4.9
0.1%
29,121
-15.7
-0.1%
FTSSI (Singapore)
3,420
-3.8
-0.1%
KOSPI
2,543
-7.6
-0.3%
JCI (Indonesia)
6,022
-20.6
-0.3%
MSCI Asia
158
-0.5
-0.3%
MSCI Asia x JP
703
-1.8
-0.3%
Hang Seng
Currency /Bond data Dollar index Bt/US$
Close
∆
%∆
94.4
-0.1
-0.1%
33.1
0.0
0.0%
113.4
-0.1
-0.1%
10Y bond yield (TH)
2.5
0.0
1.0%
10Y treasury yield (US)
2.4
0.1
2.4%
100JPY/US$
Commodities Close
∆
%∆
NYMEX (US$/bbl)
56.7
-0.4
-0.8%
BRENT (ICE) (US$/bbl)
63.5
-0.4
-0.6%
DUBAI (US$/bbl)
62.1
0.5
0.9%
1,464.0
-17.0
-1.1%
GRM (US$/bbl) Gold (US$/oz) Coal (Newcastle)*
7.1
0.2
2.6%
1,274.2
-13.3
-1.0%
97.7
-0.3
-0.3%
(US$/tonne)* (US$ cent/lb)**
Slightly weaker-than-expected 3Q17 results
▪
3Q17, a new record-high quarter
▪
Net D/E (x)
Baltic Dry Index
▪ ▪
P.3-22
Weak 3Q17 results on low gross margin Better-than-expected 3Q17
HDPE-Naphtha
607.5
-32.0
-5.0%
Ethylene-Naphtha
617.5
-22.0
-3.4%
PX-Naphtha
277.5
13.0
4.9%
BZ-Naphtha
232.5
-7.0
-2.9%
Steel-HRC
610.0
0.0
0.0%
Rubber SICOM TSR20
1,423
6.0
0.4%
Rubber TOCOM
1,750
-44.4
-2.5%
Raw Sugar**
15.0
0.1
0.5%
White Sugar**
17.7
0.0
-0.1%
Source: Thanachart , Bloomberg, Datastream,
WHAUP (BUY)
▪
3Q17 superb results and better than expected
Please note that due to the interest of timeliness, this product was not edited.
SELL
TP: Bt 21.00
Initiation
Downside : 12.5%
BCPG Pcl
13 NOVEMBER 2017
(BCPG TB)
Overvalued We initiate coverage on BCPG with a SELL rating and TP of Bt21/share. We believe BCPG’s valuation is expensive as our TP already includes potential future projects and a tariff increase for its geothermal projects. These two factors are valued at Bt4/share in our TP. Also, we expect its earnings growth to slow down after 2018F.
Thanachart Securities
Initiating with a SELL call
SUPANNA SUWANKIRD 662 – 617 4972
[email protected]
PATTADOL BUNNAK Assistant Analyst
[email protected]
COMPANY VALUATION
BCPG, the 70%-owned power arm of Bangchak Pcl (BCP TB, Bt39, BUY), is a renewable power firm with 419MW of contracted capacity and 30MW of potential capacity. Of a total 449MW of capacity,74% is in operation with the remainder due to start up during 2017-22F. Though we like BCPG’s solid management team and decent earnings-growth outlook, we view the stock as expensive, trading 14% above our SOTP-based DCF-derived (2018F base year) 12-month TP of Bt21/share. Also, its earnings growth looks set to slow from 31% in 2018F to 11% in 2019F and 2020F, on our forecasts, while its low PEG of 0.5x in 2018F would then rise to 1.4x in 2019F. We initiate with a SELL.
Y/E Dec (Bt m)
2016A
2017F
2018F
2019F
Sales
3,084
3,428
3,756
4,874
Net profit
1,541
2,186
2,869
3,173
Consensus NP
2,355
2,713
3,020
Diff frm cons (%)
(7.2)
5.8
5.1
1,401
2,186
2,869
3,173
Prev. Norm profit
2,186
2,869
3,173
Chg frm prev (%)
0.0
0.0
0.0
1.0
1.1
1.4
1.6
(64.4)
9.3
31.2
10.6
Norm profit
Norm EPS (Bt) Norm EPS grw (%)
Our TP includes unsecured expansions
Norm PE (x)
23.9
21.9
16.7
15.1
Our TP also assumes the following two items: 1) a 30% tariff increase for its geothermal projects in 2020-21F, and 2) expansion during 2021-22F of a combined 30MW (+7% from the current total capacity) mainly for its geothermal projects. We note that neither the tariff hike nor project expansion are secured yet, and they account for Bt4/share of our TP. However, one of the three existing geothermal projects, Wayang Windu ([WW] 45MW), won a 49% tariff rise in 2016, while the other Salak (65MW) and Darajat (47MW) are still negotiating tariffs. We assume those two projects will also get tariff increases.
EV/EBITDA (x)
16.0
22.6
21.6
16.8
P/BV (x)
3.5
3.5
3.3
3.1
Div yield (%)
2.9
1.8
2.4
2.7
ROE (%)
16.1
16.2
20.6
21.5
Net D/E (%)
20.6
122.8
141.5
138.7
PRICE PERFORMANCE (Bt/shr)
BCPG
30
Rel to SET In dex
25
Earnings growth outlook
20
We look for BCPG to generate earnings growth of 31% in 2018F, 11% in 2019F and 11% in 2020F. We see full-year Indonesian geothermal contribution being the key 2018F driver. The 75MW of solar projects in Japan (commercial operation due in late-2018) and the start-up of a 6MW wind project in the Philippines should be key 2019F drivers. In 2020, our 11% growth forecast is based on our assumption of successful negotiations to raise the tariff of geothermal projects in Indonesia. Without the tariff increase, 2020F earnings growth would be only 1%, on our estimates.
10
15
Upside risks to our investment case The Thai government has been promoting renewable power and we expect a revision to the Power Development Plan early next year which would see renewable capacity lifted to 40% from the current plan of 30% by 2036. However, we expect that bidding competition will be intense, but note that if the timeline were to be accelerated, this would be the key upside risk to our call. Another risk lies with the tariff increase at BCPG’s geothermal projects. As our model assumes a tariff increase of 30% in 2020, any increase above that amount would present upside risk to our thesis. In the renewables space, we prefer Energy Absolute (EA TB, Bt44, BUY), a battery-storage play trading at a 2019F PEG of 0.5x.
5 0 Sep -17
Oct-17
(%) 60 50 40 30 20 10 0 (10) Nov-17
COMPANY INFORMATION Price as of 10-Nov-17 (Bt)
24.00
Market Cap (US$ m)
1,443.3
Listed Shares (m shares)
1,992.1
Free Float (%)
29.6
Avg Daily Turnover (US$ m)
10.7
12M Price H/L (Bt) Sector Major Shareholder
24.90/12.20 Utilities BCP 70.35%
Sources: Bloomberg, Company data, Thanachart estimates
Please see the important notice on the back page
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
AMATA VN Pcl (AMATAV TB) - BUY, Price Bt9.55, TP Bt9.30
Results Comment
Rata Limsuthiwanpoom | Email:
[email protected]
Better-than-expected 3Q17 profit
▪
▪
▪
▪
AMATAV reported net profit of Bt164m in 3Q17, up by 456% yy and 413% q-q. Excluding forex loss of Bt36m, AMATAV’s normalized profit would be Bt200m up by 504% y-y and 280% q-q. This is better-than-expected on the value of land transfer revenue and its blended gross margin and lower than expected interest expense.
Industrial land sales revenue in 3Q17 was at Bt334mb vs. Bt24m in 3Q16 and none in 2Q17. This was driven by industrial land transfer of 69 rai in 3Q17 vs. 5 rai in 3Q16 and none in 2Q17
▪
9M17 normalized profit arrived at 88% of our full-year estimate. We see upside to our full-year projections as we expect AMATAV to transfer 60% of its backlog in 4Q17. We estimate AMATAV’s backlog as of ending-3Q17 at Bt450m.
AMATAV’s average gross margin rose from 52% in 3Q16 and 45% in 2Q17 to 66% in 3Q17, owing to rising industrial land sales portion which has much higher gross margin than utilities sales.
▪
AMATAV’s pre-sales in 3Q17 was at 38 rai, making 9M17 presales at 150rai vs. management’s full-year target at 125 rai.
In 3Q17, main drivers for the strong y-y and q-q earnings growth were higher industrial land sales revenue, rising gross margin and falling SG&A/sales ratio on larger sales base.
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue
4Q16
1Q17
2Q17
139
301
161
115
448
73
189
85
52
298
20
29
32
26
25
53
160
54
26
273
74
190
77
49
295
7
22
6
47
5
Other income
0
Other expense
Gross profit SG&A Operating profit EBITDA Other income Other expense
7
Interest expense Profit before tax
8
0
5
3Q17
Incom e Statem ent
3Q16
8
5
4
2
3
45
169
55
65
275
Income tax
7
26
13
7
54
Equity & invest. income
0
0
0
0
0
(Bt m ) Revenue Gross profit SG&A Operating profit EBITDA
9M as q-q% 290
y-y% 222
471
2017F 1,129
2018F 1,357
309 25
69
635
773
70
118
958
128
417
68
516
645
505
301
76
553
690
(90)
(34)
154
37
43
34
15
15
(5)
% 2017F 64
Interest expense Profit before tax
46
(65)
13
65
92
320
510
83
474
580
Income tax
684
640
78
95
116
62
(48)
(58) 407
Equity & invest. income
Minority interests
(5)
(16)
(3)
(6)
(21)
Minority interests
na
na
Extraordinary items
(208) (81)
(38) 2
(21) 32
(36) 164
Extraordinary items
na
na
Net profit
(4) 29
Net profit
413
456
60
331
Norm alized profit
33
127
40
53
200
Norm alized profit
280
504
88
331
407
413
456
60
0.35
0.44
280
504
88
0.35
0.44
(%)
3Q16
4Q16
1Q17
2Q17
32.6
36.2
(16.0)
(40.9)
222.4
246.7
148.5
(25.9)
(67.2)
416.9
86.9
117.3
(19.2)
(51.8)
300.8
EPS (Bt) Normalized EPS (Bt)
0.03
(0.09)
0.00
0.03
0.18
0.04
0.14
0.04
0.06
0.21
3Q16
4Q16
1Q17
2Q17
3Q17
357
433
489
304
957
Sales grow th
(consolidated)
Balance Sheet Yr-end Dec (Bt m ) Cash & equivalent A/C receivable
EPS (Bt) Normalized EPS (Bt) Financial Ratios
3Q17
62
128
111
113
137
Operating profit grow th
526
545
1,252
1,851
518
EBITDA grow th
Other current assets
96
40
25
37
50
Norm profit grow th
230.7
217.9
(17.9)
1.2
504.4
Investment
72
72
72
72
72
Norm EPS grow th
171.8
161.3
(17.9)
1.2
504.4
Fixed assets
607
893
868
837
819
Other assets
3,123
3,267
2,549
2,548
3,984
Gross margin
52.4
62.8
52.8
45.5
66.5
4,843
5,378
5,366
5,762
6,537
Operating margin
38.0
53.1
33.2
22.5
60.9
EBITDA margin
52.9
63.3
47.7
42.5
65.8
Norm net margin
23.8
42.3
24.5
45.8
44.6 0.8
Inventory
Total assets S-T debt
442
658
148
148
247
A/C payable
57
79
105
90
114
Other current liabilities
45
373
353
385
167
L-T debt
644
659
1,380
1,751
2,382
D/E (x)
0.3
0.4
0.5
0.6
Other liabilities
493
432
410
427
481
Net D/E (x)
0.2
0.3
0.3
0.5
0.5
Minority interest
220
220
197
203
224
Interest coverage (x)
9.3
38.9
20.2
25.4
105.4
2,942
2,957
2,773
2,757
2,920
531
594
1,258
1,874
541
1,086
1,317
1,528
1,899
2,630
Shareholders' equity Working capital Total debt Net debt
729
884
1,039
1,595
1,672
Interest rate Effective tax rate ROA ROE
0.6
1.6
1.1
0.4
0.5
16.1
15.3
23.2
10.5
19.6
2.9
10.0
3.0
3.8
13.0
4.4
17.3
5.5
7.6
28.2
Sources: Company data, Thanachart estimates
THANACHART SECURITIES
3
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
AP(Thailand) Pcl (AP TB) - BUY, Price Bt8.95, TP Bt10.00
Results Comment
Phannarai Tiyapittayarut | Email:
[email protected]
Good 3Q17 results, in line with consensus
▪
▪ ▪
▪
AP reported good 3Q17 normalized profit of Bt617m, up 35% y-y and 12% q-q, in line with consensus but 6% above our estimate on better-than-expected gross margin on property sales.
Equity income turned from loss in 3Q16 to Bt43m in 3Q17 on higher sales recognition from JV condos of Bt1bn in this quarter.
▪
With a Bt20m gain from sale of investment in AP ME4 and AP ME5 to JV partner, 3Q17 net profit was Bt637m, up 39% y-y and 4% q-q.
Real estate sales revenues grew by 10% y-y but flat q-q at Bt4.6bn.
▪
Blended gross margin improved y-y and q-q to 36.6% driven by 1) a rise in management and sales fees collected from JV projects of Bt160m vs Bt73m in 2Q17, and 2) rising gross margin on property to 33.8% in 3Q17 vs 31.8% in 3Q16 and 33.1% in 2Q17. Gross margin on low-rise houses beats its 30% guidance to 34.2%.
Yr-end Dec (Bt m) Revenue
▪
(consolidated)
Income Statement 3Q16
4Q16
1Q17
2Q17
3Q17
4,448
7,203
4,200
4,798
4,939
1,564
2,458
1,376
1,647
1,809
935
1,446
914
1,002
1,087
629
1,012
462
645
722
641
1,024
474
660
741
Other income
33
27
12
10
36
Other expense
0
3
0
0
0
Gross profit SG&A Operating profit EBITDA
9M17 net profit came to 64% of our full-year forecast. 4Q17F will be the best quarter of this year given backlog on hand, we maintain our earnings. Note that 10M17 presales already reach Bt30.1bn, at 116% of the company’s full-year target. Since its Bt9bn Life AsokeRama 9 is to be launched this month, there is chance of this year’s presales beating our Bt34.9bn assumption for 2017F.
Income Statement (Bt m) Revenue Gross profit
68
7,135
8,095
72
4,200
4,553
12
15
62
2,935
3,542
12
16
63
2,992
3,604
Other income
249
11
64
93
104
Other expense
(37)
(83)
na
0
0
(54)
(22)
64
183
200
21
16
62
2,845
3,446
(5)
31
71
597
724
Equity & invest. income
(61)
na
73
501
737
Minority interests
(83)
na
na
0
0
Extraordinary items
(67)
133
61
0
Operating profit EBITDA
43
20
636
975
421
612
738
Interest expense Profit before tax
Income tax
127
207
85
175
166
Income tax
Equity & invest. income
(53)
510
213
110
43
(0)
(0)
0
5
1
0 457
(13) 1,265
0 549
61 613
20 637
Normalized profit
457
1,278
549
552
617
EPS (Bt) Normalized EPS (Bt)
0.15
0.40
0.17
0.19
0.20
0.15
0.41
0.17
0.18
0.20
3Q16
4Q16
1Q17
2Q17
3Q17
674
1,087
964
1,038
664
79
40
58
88
95
Yr-end Dec (Bt m)
(consolidated)
Cash & equivalent A/C receivable Inventory
2018F 23,964
16
53
Balance Sheet
2017F 21,002
16
60
Net profit
% 2017F 66
8
25
Extraordinary items
y-y% 11
10
SG&A
Interest expense Profit before tax
Minority interests
9M as q-q% 3
Net profit
4
39
64
2,809
3,459
Normalized profit
12
35
62
2,749
3,459
EPS (Bt) Normalized EPS (Bt)
4
39
64
0.89
1.10
12
35
62
0.87
1.10
3Q17
Financial Ratios (%)
3Q16
4Q16
1Q17
2Q17
Sales growth
(19.1)
20.9
0.7
8.3
11.0
Operating profit growth
(31.4)
5.4
(26.4)
(5.3)
14.8
31,493
30,743
32,923
33,536
34,349
EBITDA growth
(31.3)
5.0
(26.1)
(5.1)
15.5
Other current assets
1,297
1,249
1,405
926
705
Norm profit growth
(26.5)
89.0
31.4
18.9
35.0
Investment
2,796
3,526
3,481
3,892
4,290
Norm EPS growth
(26.5)
89.0
31.4
18.9
35.0
163
183
184
342
263 Gross margin
35.2
34.1
32.8
34.3
36.6
Operating margin
14.1
14.1
11.0
13.4
14.6
EBITDA margin
14.4
14.2
11.3
13.8
15.0
Norm net margin
10.3
17.7
13.1
11.5
12.5
Fixed assets Other assets
982
962
1,054
972
1,099
37,485
37,790
40,069
40,793
41,465
6,819
6,441
8,154
8,841
9,342
88
924
931
880
980
Other current liabilities
2,815
2,356
2,084
2,030
2,052
L-T debt
9,300
8,300
8,400
9,040
8,441
316
345
527
365
373
1
1
1
(4)
(1)
18,147
19,423
19,972
19,641
Working capital
31,484
29,858
32,050
Total debt
16,119
14,741
16,554
Net debt
15,445
13,654
15,590
Total assets S-T debt A/C payable
Other liabilities Minority interest Shareholders' equity
D/E (x)
0.9
0.8
0.8
0.9
0.9
Net D/E (x)
0.9
0.7
0.8
0.9
0.8
Interest coverage (x)
25
17
9
15
37
20,278
Interest rate
0.6
1.6
1.4
1.0
0.4
32,744
33,464
Effective tax rate
19.9
21.2
20.3
28.5
22.5
17,881
17,783
4.9
13.6
5.6
5.5
6.0
16,843
17,119
ROA ROE
10.2
27.2
11.1
11.2
12.4
Sources: Company data, Thanachart estimates
THANACHART SECURITIES
4
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Bangkok Dusit Medical (BDMS TB) - HOLD, Price Bt21, TP Bt20
Results Comment
Siriporn Arunothai | Email:
[email protected]
3Q17 earnings were better than expected
▪
▪ ▪
▪
BDMS reported norm profit of Bt2.4bn, up 11% y-y and 51% q-q. This was slightly better than ours and the street’s earnings forecast due to its lower-than-expected cost of goods sold to sales and SG&A to sales expense. Key earnings drivers were improving revenue and cost control.
▪
Revenue was up 7% y-y and 15% q-q to Bt18.6bn in 3Q17. Its revenue growth was driven by rising number of Thai and international patients, increase in price intensity, an opening of Paolo Kaset Hospital and Bangkok Hospital Surat since January and June 2017. Revenue from Thai patients grew 6% y-y and international patient grew by 8% y-y. Key drivers were mainly from Middle East, Chinese and Australian patients.
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA
3Q16
4Q16
1Q17
2Q17
3Q17
17,299
16,669
16,535
16,216
18,577
5,372
4,977
5,104
4,713
5,992
3,592
3,565
3,426
3,559
3,800
1,780
1,412
1,678
1,154
2,192
3,021
2,668
2,931
2,438
3,501
921
1,010
866
963
933
0
0
0
0
0
241
246
363
409
433
Other income Other expense Interest expense Profit before tax
With rising revenue and the company’s cost control efficiency, this caused its gross margin expanding to 32.3% in 3Q17 up from 31.1% in 3Q16 and 29.1% in 2Q17. SG&A to sales also declined to 20.5% in 3Q17 from 20.8% in 3Q16 and 22.0% in 2Q17. 9M17 norm profit accounted for 77% of our full-year earnings forecast. We maintain our earnings forecast and TP. Though we expect BDMS’s improving earnings growth momentum still continue in 4Q17F but with 38x trading PE vs. 10% EPS growth in 2018F, its valuation is fully value in our view. We maintain HOLD.
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
9M as q-q% 15
y-y% 7
27
12
7
6
90
% 2017F 75
2017F 68,482
2018F 76,292
76
20,730
23,049
74
14,501
16,264
23
81
6,229
6,786
44
16
77
11,525
12,853
(3)
1
76
3,646
3,925
Other expense
0
0
Interest expense Profit before tax
6
80
85
1,413
1,383
2,460
2,176
2,182
1,708
2,692
58
9
78
8,462
9,328
Income tax
563
416
462
406
564
Income tax
39
0
79
1,819
1,912
Equity & invest. income
396
307
324
368
416
Equity & invest. income
13
5
78
1,427
1,568
Minority interests
(107)
(102)
(70)
(75)
(128)
Minority interests
na
na
83
(330)
(340)
Extraordinary items
12 1,977
0 1,974
2,195 3,791
0 2,417
Extraordinary items
Net profit
147 2,334
Norm alized profit
2,187
1,965
1,974
1,596
2,417
0.15
0.13
0.13
0.24
0.16
EPS (Bt) Normalized EPS (Bt)
0.16
Net profit Norm alized profit EPS (Bt) Normalized EPS (Bt)
2,195
0
(36)
4
82
9,935
8,644 8,644
51
11
77
7,740
(36)
4
82
0.64
0.55
51
11
77
0.50
0.55
3Q17
0.14
0.13
0.13
0.10
Yr-end Dec (Bt m )
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
3Q16
4Q16
1Q17
2Q17
Cash & equivalent
5,011
4,765
6,439
6,053
5,517
Sales grow th
12.7
4.6
0.8
9.1
7.4
A/C receivable
6,042
6,033
6,105
5,946
6,551
Operating profit grow th
16.2
(23.4)
(17.5)
6.0
23.2
Inventory
1,363
1,516
1,436
1,476
1,512
344
282
242
238
300
(consolidated)
Balance Sheet
Other current assets Investment
16,827
17,237
17,573
15,918
16,198
Fixed assets
54,504
56,461
67,960
67,989
68,465
Other assets
Financial Ratios
EBITDA grow th
14.6
(11.3)
(8.0)
8.7
Norm profit grow th
16.4
(8.7)
(18.0)
(1.5)
10.5
16
Norm EPS grow th
16.4
(8.7)
(18.0)
(1.5)
10.5
Gross margin
31.1
29.9
30.9
29.1
32.3
Operating margin
10.3
8.5
10.2
7.1
11.8
21,022
20,646
20,509
20,469
20,173
105,111
106,939
120,263
118,088
118,716
S-T debt
6,359
5,964
4,427
7,859
4,635
EBITDA margin
17.5
16.0
17.7
15.0
18.8
A/C payable
4,587
4,546
12,079
4,455
4,839
Norm net margin
12.6
11.8
11.9
9.8
13.0
Total assets
Other current liabilities L-T debt Other liabilities Minority interest Shareholders' equity Working capital
5,306
7,368
5,781
6,302
6,608
26,370
28,509
35,262
36,034
38,696
D/E (x)
0.6
0.6
0.7
0.8
0.7
5,186
2,248
2,468
2,396
2,376
Net D/E (x)
0.5
0.5
0.6
0.6
0.6
Interest coverage (x)
13
10.8
8.1
6.0
8.1
Interest rate
3.0
2.9
3.9
3.9
4.0
Effective tax rate
22.9
19.1
21.2
23.8
20.9
ROA ROE
8.4
7.4
6.9
5.4
8.2
16.1
14.2
13.9
11.0
16.5
2,544
2,586
2,550
2,587
2,701
54,760
55,719
57,696
58,456
58,862
2,818
3,002
(4,539)
2,967
3,224
Total debt
32,729
34,472
39,689
43,892
43,331
Net debt
27,718
29,707
33,249
37,839
37,814
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
5
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
COL Public Co Ltd (COL TB) - SELL, Price Bt78.50, TP Bt53.50
Results Comment
Siriporn Arunothai | Email:
[email protected]
3Q17 earnings were below our expectation
▪
▪
▪
COL reported strong core profit in 3Q17 but it was below ours and the market’s expectation. Its net profit was Bt131m in 3Q17, up 46% y-y and 76% q-q. The strong earnings resulted from no loss contribution from its retail online business after COL exited from the business on 1 August 2017. Meanwhile, the company weaker-than-expected earnings resulted from its weaker-than-expected B2S’s sales and other income and higher-than-expected SG&A to sales expense.
9M17 norm earnings accounted for 59% of our full-year earnings forecast. We expect COL’s earnings to be stronger in 4Q17 due to improving operation of its OfficeMate and B2S businesses and the exit from its loss-making retail online business. However, we see COL share price already reflected that positive news. We maintain SELL.
It two core businesses, OfficeMate’s and B2S’s operation in 3Q17 was slightly improved. OfficeMate’s revenue rose by 8% y-y to Bt1.8bn. B2S’s revenue grew by 2% y-y to Bt987m. The company’s gross margin also improved, supported by rising sales mix in high-margin house brand products. (consolidated)
Income Statement Yr-end Dec (Bt m) Revenue
3Q16
4Q16
1Q17
2Q17
3Q17
2,758
2,845
2,798
2,754
2,836
Gross profit
681
722
687
703
742
781
807
761
802
814
(101)
(85)
(75)
(98)
(72)
(26)
(6)
(8)
(29)
2
242
218
315
243
225
SG&A Operating profit EBITDA Other income
Income Statement (Bt m) Revenue
9M as q-q% 3
Gross profit SG&A Operating profit EBITDA
y-y% 3
% 2017F 72
2018F 12,901
5
9
72
2,954
3,333
2
4
75
3,176
3,377
(221)
(44)
na
na
111
na
na
(104)
Other income
2017F 11,696
(7)
(7)
71
34
226
1,097
1,167
0
0
Other expense
0
0
0
0
0
Other expense
Interest expense Profit before tax
0
0
0
1
1
(51)
142
133
240
143
152
Interest expense Profit before tax
6
7
Income tax
(10)
(17)
na
na
(48)
na
(60)
Net profit
76
46
48
Normalized profit
76
46
59
606
904
EPS (Bt) Normalized EPS (Bt)
76
46
48
2.34
2.82
76
46
59
1.90
2.82
Income tax
28
12
46
26
23
(22)
(28)
(39)
(45)
1
Equity & invest. income
Minority interests
(2)
(3)
(1)
2
1
Minority interests
Extraordinary items Net profit
0 90
0 90
0 154
0 75
0 131
Normalized profit
90
90
154
75
131
Equity & invest. income
EPS (Bt) Normalized EPS (Bt)
0.28
0.28
0.48
0.23
0.41
0.28
0.48
0.23
0.41
Yr-end Dec (Bt m)
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
Cash & equivalent
1,382
672
589
860
1,033
Sales growth
658
740
830
795
803
1,482
1,711
1,545
1,488
1,534
(consolidated)
A/C receivable Inventory Other current assets Investment
2
4
61
873
1,119
58
163
214
84
(99)
0
(5)
(1)
Extraordinary items
0.28
Balance Sheet
84
143
0
749
904
Financial Ratios 3Q16
4Q16
1Q17
2Q17
3Q17
7.6
8.0
5.0
7.1
2.8
Operating profit growth
na
na
na
na
na
EBITDA growth
na
na
na
na
na
0
0
0
0
0
Norm profit growth
(9.3)
(6.9)
6.9
23.8
45.8
117
89
50
5
0
Norm EPS growth
(9.3)
(6.9)
6.9
23.8
45.8
Fixed assets
792
1,560
1,517
1,515
1,575
Other assets
3,511
3,548
3,564
3,582
3,577
Gross margin
24.7
25.4
24.5
25.5
26.2
7,943
8,321
8,095
8,245
8,522
Operating margin
5.1
4.7
8.6
5.2
5.4
0
0
0
0
0
EBITDA margin
7.8
7.4
11.0
7.8
8.0
2,628
2,908
2,453
2,543
2,093
Norm net margin
3.3
3.2
5.5
2.7
4.6
27
38
68
230
673
0
0
0
0
0
Total assets S-T debt A/C payable Other current liabilities L-T debt Other liabilities Minority interest Shareholders' equity Working capital Net debt
-
-
(0.3)
(0.1)
(0.1)
0.0 (0.2)
(0.2)
93
95
96
97
97
Net D/E (x)
9
13
59
57
56
Interest coverage (x)
na
na
5,027.9
176.6
na
Interest rate
na
na
na
5,540.6
2,715.4
19.8
8.8
19.2
18.0
15.3
4.6
4.4
7.5
3.6
6.3
7.0
6.9
11.6
5.6
9.6
5,186
5,268
5,419
5,318
5,603
(487)
(456)
(79)
(260)
245
Total debt
D/E (x)
0 (1,382)
0 (672)
0 (589)
0 (860)
0 (1,033)
Effective tax rate ROA ROE
Sources: Company data, Thanachart estimates
THANACHART SECURITIES
6
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Energy Absolute Pcl (EA TB) - BUY, Price Bt44.00, TP Bt46.00
Results Comment
Supanna Suwankird | Email:
[email protected]
3Q17 results in line
▪
▪ ▪
Summary: Good results driven by increased power generation as EA’s 126MW wind power project operated in full quarter and also in the windy season. 4Q17 results would be better as higher-tariff solar power will enjoy high radiation period in 4Q. With another 260MW of wind power to COD in 4Q18, we see this to further boost earnings in 2018-19. In addition, Its gigantic energy storage plants to bring in new S-curve earning in the long term. BUY. EA’s 3Q17 net earnings came in at Bt976m. Excluding forex gain, its norm earnings would be Bt970m, up 26% y-y and 1% q-q. The results were in line with the consensus estimates.
▪ ▪ ▪
▪
The good results y-y were driven by the 126MW Had Kanhan wind power projects which started operation in late 2Q17. Also, wind speed 3Q17 was quite strong. Meanwhile its original business was dragged by bio-diesel due to declined sales volume and increased feedstock cost. However, the original business normally contributes profit less than 5% of total profit. (consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue Gross profit
3Q16
4Q16
1Q17
2Q17
3Q17
2,545
2,278
2,646
2,933
3,097
1,167
1,187
1,301
1,370
1,475
104
75
143
145
169
1,063
1,112
1,158
1,225
1,306
1,257
1,423
1,475
1,583
1,744
5
10
48
12
1
SG&A Operating profit EBITDA Other income Other expense
The flat result q-q was due to low solar radiation in 3Q which is rainy season. EBITDA margin rose to 56% vs 49% in 3Q16 and 54% in 2Q17. SG&A and interest expense still kept rising strong mainly due to expenses related to its new business plans – energy storage plant and downstream products which wasn’t capitalized, apart from Had Kanhan project. For example, the charging station and etc. 9M17 norm earnings made up 71% of our full year estimate. We expect EA to make better earnings in 4Q17 given the season changing to dry season thus we expect more power generation from its solar power plants which have adder of Bt8.0/kWh on top of its normal base tariff (vs Bt3.50/kWh for wind power.
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
Income tax
298
260
249
284
331
770
862
957
953
977
2
5
Equity & invest. income Minority interests
Interest expense Profit before tax
6,053
10
39
74
6,486
7,687
(91)
(76)
164
37
42
77
1,121
1,243
27
71
4,058
4,853
na
na
36
72
4,062
4,844
Norm alized profit
1
26
71
4,062
4,844
1
36
72
1.09
1.30
1
26
71
1.09
1.30
3Q16
4Q16
1Q17
2Q17
3Q17
11.9
(5.6)
8.6
(6.4)
21.7
Operating profit grow th
30.7
29.2
32.8
(2.0)
22.8
EBITDA grow th
24.9
34.9
41.0
(6.2)
38.7
Norm profit grow th
16.5
31.6
33.2
(3.5)
26.3
Norm EPS grow th
16.5
31.6
33.2
(3.5)
26.3
Gross margin
45.9
52.1
49.2
46.7
47.6
Operating margin
41.8
48.8
43.8
41.8
42.2
EBITDA margin
49.4
62.4
55.7
54.0
56.3
Norm net margin
30.2
37.6
35.8
32.7
31.3
D/E (x)
2.7
2.5
2.3
2.2
2.0
Net D/E (x)
2.5
2.3
2.0
2.0
1.8
4
5
6
6
5
Interest rate
4.6
3.6
3.5
4.0
4.8
Effective tax rate
0.2
0.6
(0.1)
(0.1)
(0.1)
ROA ROE
8.0
8.3
9.0
8.9
9.0
30.1
31.2
31.9
30.5
29.2
958
970
0.19
0.22
0.26
0.26
0.26
0.21
0.23
0.25
0.26
0.26
Yr-end Dec (Bt m )
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
Cash & equivalent
2,610
2,673
2,974
3,063
3,079
Sales grow th
A/C receivable
1,198
1,319
1,436
1,544
837
163
187
152
177
194
2,750
1,953
1,952
1,807
2,202
32,499
33,485
34,459
34,139
Other assets
1,387
1,890
1,971
2,212
2,209
40,607
41,507
42,944
42,942
43,011
47 35
1
947
Fixed assets
44 30
Net profit
856
Investment
(7) (53) na
768
Extraordinary items
EPS (Bt) Normalized EPS (Bt) Financial Ratios
34,490
2,279
2,598
2,194
2,948
2,746
253
420
312
83
100
5
521
1,013
695
506
26,423
25,779
25,839
25,216
24,756
1,088
800
1,208
1,230
1,052
6
6
7
7
77
Minority interest
11
2
na
Norm alized profit
Other current liabilities
17
na
Net profit
A/C payable
na
na
7 976
Shareholders' equity
5,141
(19)
(0)
9 966
10,553
11,383
12,372
12,764
1,107
1,086
1,277
1,638
932
Total debt
28,702
28,377
28,033
28,164
27,502
Net debt
26,092
25,704
25,059
25,101
24,423
Working capital
72
na
(0)
Other liabilities
23
na
33 979
L-T debt
732
7
Income tax
(1)
S-T debt
612
Equity & invest. income
(0)
Total assets
5,753
75
(9)
(26) 830
Other current assets
72
(1)
(0)
Inventory
6,785
26
4
(consolidated)
2018F 13,986
62
(1)
Balance Sheet
2017F 12,413
8
(1)
Minority interests
% 2017F 70
17
(11) (50) 718
EPS (Bt) Normalized EPS (Bt)
y-y% 22
Other expense
Interest expense Profit before tax
Extraordinary items
9M as q-q% 6
13,774
Interest coverage (x)
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
7
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
The Erawan Group Pcl (ERW TB) - BUY, Price Bt7.40, TP Bt6.80
Results Comment
Kalvalee Thongsomaung | Email:
[email protected]
Strong 3Q17 results, in-line
▪ ▪ ▪
▪
ERW reported strong 3Q17 earnings results, driven by a higher occupancy rate and room rate as well as new hotel expansions. ERW reported a 3Q17 profit of Bt79m, up 42% y-y and 38% q-q. The results were in-line with ours and the market’s expectations.
▪
ERW’s hotels reported an overall occupancy rate at 83% in 3Q17 vs. 84% in 3Q16 and 83% in 2Q17. RevPar growth was 3% y-y in 3Q17 due mainly to an increase in room rate by 4% y-y. ERW saw growth from its almost segments (midscale, economy and budget hotel segments).
4Q16
1Q17
2Q17
3Q17
1,375
1,430
1,620
1,345
1,448
738
788
942
728
793
553
562
580
569
568
185
226
362
160
225
370
410
542
343
412
Other income
7
6
15
15
10
Other expense
0
0
0
0
0
89
91
84
83
88
Gross profit Operating profit EBITDA
Interest expense Profit before tax
103
141
293
91
Economy hotels’ operating income (17% of total operating income) increased by 6% y-y. This was driven by a room rate growth.
▪
3Q16
SG&A
Mid-scale hotels’ operating income (27% of total operating income) increased by 10%y-y. This was driven by a rising occupancy rate and room rate growth.
▪
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue
Luxury hotels’ operating income (51% of total operating income) was down 2% y-y. RevPar also decreased by 4% y-y due to the room renovation impact at JW Marriott Bangkok hotel.
146
Budget hotels’ operating income (5% of total operating income) increased by 43% y-y. The increase was due to higher occupancy rate and room rate growth as well as an additional income from new hotels.
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
9M as q-q% 8
y-y% 5
% 2017F 72
2017F 6,161
2018F 6,751
9
7
73
3,395
3,755
(0)
3
71
2,410
2,639
41
22
76
986
1,116
20
12
74
1,760
1,944
(34)
38
79
51
42 424
Other expense Interest expense Profit before tax
6
(1)
67
383
60
43
81
654
734
Income tax
29
14
79
152
169
Income tax
30
32
59
26
34
Equity & invest. income
(4)
5
(7)
1
(22)
Equity & invest. income
na
na
(199)
14
10
(13)
(15)
(19)
(9)
(11)
Minority interests
na
na
88
(45)
(49)
Net profit
0 56
4 103
0 208
0 57
0 79
Net profit
38
42
73
471
526
Norm alized profit
56
99
208
57
79
Norm alized profit
38
42
73
471
526
0.02
0.04
0.08
0.02
0.03
38
42
74
0.19
0.21
0.02
0.04
0.08
0.02
0.03
38
42
74
0.19
0.21
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
3Q16
4Q16
1Q17
2Q17
3Q17
Cash & equivalent
934
795
1,040
962
969
Sales grow th
13.1
3.2
5.0
5.3
5.3
A/C receivable
178
202
199
164
185
Operating profit grow th
130.7
3.2
13.6
47.4
21.7
Minority interests Extraordinary items
EPS (Bt) Normalized EPS (Bt)
(consolidated)
Balance Sheet Yr-end Dec (Bt m )
Inventory Other current assets Investment Fixed assets Other assets Total assets S-T debt
Financial Ratios
52
53
48
47
51
41.6
3.1
8.8
18.6
11.5
183
209
213
250
Norm profit grow th
na
1.2
8.7
238.6
42.2
Norm EPS grow th
na
1.1
8.7
238.6
42.2
153
155
136
131
109
11,707
11,811
11,970
12,163
1,786
1,815
1,788
1,765
1,796
14,814
14,911
15,229
15,250
15,524
2,901
2,558
2,385
2,233
2,398
228
252
229
213
240
Other current liabilities
EPS (Bt) Normalized EPS (Bt)
204 11,508
A/C payable
Extraordinary items
EBITDA grow th
Gross margin
53.6
55.1
58.2
54.2
54.7
Operating margin
13.4
15.8
22.3
11.9
15.5
EBITDA margin
26.9
28.7
33.4
25.5
28.5
4.1
7.0
12.8
4.3
5.5
Norm net margin
703
795
813
726
767
L-T debt
2,634
5,869
6,420
6,567
6,522
D/E (x)
1.1
1.7
1.7
1.7
1.7
Other liabilities
3,361
363
99
370
373
Net D/E (x)
0.9
1.6
1.5
1.5
1.5
Interest coverage (x)
4.1
4.5
6.5
4.1
4.7
Interest rate
5.1
5.2
3.9
3.8
4.0
29.2
22.8
20.2
28.8
23.2
1.5
2.7
5.5
1.5
2.1
4.6
8.1
16.6
4.5
6.3
Minority interest Shareholders' equity
143
155
174
136
147
4,845
4,918
5,110
5,007
5,076
2
3
17
(3)
(4)
Total debt
Working capital
5,534
8,427
8,805
8,799
8,920
Net debt
4,600
7,632
7,765
7,838
7,951
Effective tax rate ROA ROE
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
8
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Esso (Thailand) Pcl (ESSO TB) - BUY, Price Bt13.90, TP Bt17.00
Results Comment
Chak Reungsinpinya | Email:
[email protected]
3Q17 a strong beat
▪
▪
ESSO reports 3Q17 net profit of Bt3.1bn (EPS Bt0.89/sh) compared to reported losses in 3Q16 and 2Q17 (both had inventory losses and maintenance shutdowns). Stripping out impacts of inventory gain, we estimate normalized net profit to be Bt2.0-2.2bn. Both reported and normalized earnings are higher than our expectation even after taking into account the stronger-than-expected refining margin environment. We believe a combination of strong earnings outlook and improved balance sheet strength pave ways for a potential dividend payout after 4Q17F results are reported (early 2018F). Maintain BUY, TP Bt17
market GRM to be in the range of $8.8-9.3/bbl which compares favorably to Singapore GRM of $8.3/bbl. We think the key to upside surprise was the increased yields of light and middle distillates as the company took advantage of attractive pricing for light sweet crude.
▪
▪
Downstream: Crude intake reached 146kbd which was at the high end of historical range and a marked improvement from 108kbd in 3Q16 and 114kbd in 2Q17 (both quarters impacted by maintenance shutdowns). Reported GRM was $11.3/bbl. Stripping out inventory gain of about $2.5-3/bbl, we estimate
Yr-end Dec (Bt m ) Revenue
3Q16
4Q16
1Q17
2Q17
3Q17
34,247
40,947
44,811
40,771
43,490
Gross profit SG&A Operating profit EBITDA
842
4,567
3,243
961
5,235
1,400
1,517
1,401
1,391
1,459
(558)
Other income Other expense
3,050
1,842
(431)
3,776
(58)
3,558
2,317
58
4,267
19
13
3
64
65
0
0
0
0
0
100
89
Interest expense Profit before tax
121
120
110
(660)
2,943
1,735
(467)
3,753
Income tax
(134)
588
348
(108)
749
93
84
108
96
94
0
0
0
(1)
0
Equity & invest. income Minority interests Extraordinary items Net profit
(589) (433)
1,199 2,438
(176) 1,496
Norm alized profit EPS (Bt) Normalized EPS (Bt)
Yr-end Dec (Bt m )
Inventory Other current assets Investment
987 3,097
156
1,239
1,672
703
2,110
0.70
0.43
(0.08)
0.89
0.05
0.36
0.48
0.20
0.61
3Q16
4Q16
1Q17
2Q17
3Q17
225
557
388
401
776
3,435
4,510
5,187
4,378
4,497
15,529
17,248
15,959
14,276
19,005
1,858
1,478
2,236
2,362
(consolidated)
Cash & equivalent A/C receivable
(1,208) (263)
(0.13)
Balance Sheet
Non-operating items: We estimate inventory gain to be $2.53.0/bbl of crude intake which equate to pre-tax gain of Bt1.11.3bn (after-tax gain of Bt0.9-1.1bn).
▪
(consolidated)
Incom e Statem ent
Petrochemical: Loss from petrochemical narrowed y-y and qq to Bt282m; again this contributed to the positive surprise after a miss in 2Q17. We believe this was due to both improved PXMX spread q-q and higher volume y-y (production volume was 67k tons in 3Q17 vs 44k tons in 3Q16).
Balance sheets continue to strengthen as net D/E declined to 0.6x at end-3Q17 from nearly 0.9x at end-2Q17. Retained earnings have also turned positive for the first time since 4Q13.
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
9M as q-q% 7
y-y% 27
445
522
5
4
na
2017F 168,673
2018F 184,868
68
13,788
13,971
72
5,924
5,984
na
66
7,864
7,987
7,237
na
67
9,852
9,935
1
244
133
100
109
na
0
0
71
419
394
Other expense Interest expense Profit before tax
(12)
(27)
% 2017F 77
na
na
67
7,544
7,702
Income tax
na
na
66
1,509
1,540
Equity & invest. income
(2)
1
75
399
419
87
(1)
(1)
Minority interests Extraordinary items Net profit Norm alized profit EPS (Bt) Normalized EPS (Bt)
na
na
na
0
0
na
na
67
6,433
6,579
200
1,255
70
6,433
6,579
na
na
67
1.86
1.90
200
1,255
70
1.86
1.90
Financial Ratios (%)
3Q16
4Q16
1Q17
2Q17
3Q17
Sales grow th
(18.2)
3.1
26.2
1.1
27.0
na
na
Operating profit grow th
na
440.3
(22.3)
EBITDA grow th
na
221.7
(19.0)
(98.5)
na
1,697
Norm profit grow th
na
173.1
(6.7)
(37.2)
1,255.0
Norm EPS grow th
na
173.1
(6.7)
(37.2)
1,255.0
2,066
2,148
2,256
1,994
2,088
Fixed assets
27,905
27,909
27,593
27,279
27,020
Other assets
5,443
4,903
4,624
5,316
4,600
Gross margin
2.5
11.2
7.2
2.4
12.0
7.4
4.1
(1.1)
8.7
56,461
58,751
58,243
56,007
59,684
Operating margin
(1.6)
16,327
10,569
14,151
12,847
10,450
EBITDA margin
(0.2)
8.7
5.2
0.1
9.8
A/C payable
3,758
4,028
4,137
4,250
3,816
0.5
3.0
3.7
1.7
4.9
Other current liabilities
6,936
11,561
6,720
6,637
10,970
L-T debt
8,550
9,400
8,400
7,400
8,933
D/E (x)
1.4
1.0
1.0
0.9
0.8
Other liabilities
2,632
2,441
2,479
2,519
0
Net D/E (x)
1.4
0.9
1.0
0.9
0.7
Interest coverage (x)
Total assets S-T debt
Minority interest
Norm net margin
7
7
7
7
7
Shareholders' equity
18,251
20,745
22,349
22,347
25,507
Interest rate
Working capital
15,205
17,730
17,009
14,405
19,687
Effective tax rate
Total debt
24,877
19,969
22,551
20,247
19,383
Net debt
24,652
19,412
22,163
19,846
18,607
ROA ROE
30
21
1
48
2.0
(0)
2.1
2.1
1.9
1.8
20.2
20.0
20.0
23.2
20.0
1.1
8.6
11.4
4.9
14.6
3.4
25.4
31.0
12.6
35.3
Sources: Company data, Thanachart estimates
THANACHART SECURITIES
9
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Jasmine International (JAS TB) - SELL, Price Bt7.40, TP Bt3.50
Results Comment
Siriporn Arunothai | Email:
[email protected]
Weak 3Q17 earnings, below our expectation
▪
▪ ▪
▪
JAS reported normalized profit of Bt431m in 3Q17, down 21% y-y and 7% q-q. This was below our earnings estimates due to weaker-than-expected gross margin and higher-than-expected interest expenses. Including extra gain (loss), it reported net profit of Bt532m, down 45% y-y and 4% q-q. JAS’s weak earnings resulted from rising depreciation costs from more aggressive expansion of its backbone and last-mile networks and rising lease expenses.
▪
Broadband subscribers increased around 0.09m in 3Q17, bringing the total to 2.7m subs at end-3Q17, up from 2.4m subs at end-2016 and 2.6m subs at end-2Q17.
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA
3Q16
4Q16
1Q17
2Q17
3Q17
3,899
4,094
4,327
4,393
4,335
1,531
1,376
1,402
1,476
1,429
1,132
1,141
1,052
1,091
1,078
399
235
350
386
351
1,020
1,080
1,190
1,279
1,293
Other income Other expense Interest expense Profit before tax Income tax Equity & invest. income Minority interests Extraordinary items
95
85
119
67
71
0
0
0
0
0
123
175
157
166
178
370
145
312
286
244
76
(48)
128
102
76
255
262
277
275
271
(5)
(1)
(23)
6
(8)
9M17 earnings accounted for 47% of our full-year earnings forecast. Though we expect JAS’s new subscribers to increase in the following quarters, rising depreciation costs and operating expenses still put pressure on its earnings growth. Together with increasing competition from newcomers in the broadband internet market in the coming years, we maintain our SELL recommendation on JAS. The company announced interim dividend payment of Bt0.15/share. The XD date is 23 November 2017 and the payment date is 8 December 2017.
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
(9)
(12)
51
2,136
2,954
1
27
73
5,172
6,121
7
(25)
146
176
197
0
0
122
410
123
44
1,902
3,029
107
285
485
Equity & invest. income
(2)
6
68
1,214
997
Minority interests
na
na
(492)
Extraordinary items
16
(76)
Net profit
(4)
Norm alized profit
(7)
438
466
431
0.14
0.16
0.11
0.09
0.08
0.08
0.08
0.07
0.07
0.07
Yr-end Dec (Bt m )
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
Cash & equivalent
2,760
2,859
1,792
1,713
1,808
Sales grow th
A/C receivable
3,068
3,020
3,031
3,020
3,260
Operating profit grow th
EPS (Bt) Normalized EPS (Bt)
5
5
43
1,034
954
(45)
46
3,870
4,500
(21)
47
2,836
3,546
(5)
(40)
49
0.56
0.52
(9)
(13)
51
0.41
0.41
3Q16
4Q16
1Q17
2Q17
3Q17
9.1
10.9
14.7
14.0
11.2
(17.6)
53.9
(16.5)
(34.7)
(12.0)
Financial Ratios
0
0
0
0
0
2.7
49.4
21.6
8.5
1,427
1,511
1,642
1,795
1,496
Norm profit grow th
(24.9)
(4.4)
(29.7)
(41.0)
(20.9)
Norm EPS grow th
(24.9)
14.8
(19.9)
(34.1)
(13.1) 33.0
7,583
6,850
6,705
6,497
6,383
25,178
27,976
28,372
29,385
29,924
EBITDA grow th
27
Gross margin
39.3
33.6
32.4
33.6
Operating margin
10.2
5.7
8.1
8.8
8.1
9,569
EBITDA margin
26.2
26.4
27.5
29.1
29.8
3,872
Norm net margin
14.0
11.1
10.1
10.6
9.9
5,487
5,378
5,366
5,315
5,614
45,503
47,594
46,908
47,725
48,484
S-T debt
4,171
6,210
5,535
8,124
A/C payable
3,708
3,198
3,817
4,394
Other current liabilities
7,889 4,935
0
454
Total assets
6,796 4,660
(34)
545
Other assets
63 69
(15)
Norm alized profit
Fixed assets
(7) (5)
(26)
100 532
Investment
(3) (1)
Income tax
86 552
Inventory
2018F 18,621
44
255 693
Other current assets
2017F 17,259
7
472 926
(consolidated)
% 2017F 76
Interest expense Profit before tax
423 968
Balance Sheet
y-y% 11
Other expense
Net profit EPS (Bt) Normalized EPS (Bt)
9M as q-q% (1)
5,001
1,529
1,758
1,537
1,338
21,774
23,478
22,523
21,004
20,113
D/E (x)
2.9
2.9
2.5
2.7
2.8
848
1,912
835
796
1,802
Net D/E (x)
2.6
2.6
2.3
2.5
2.6
Minority interest
1,067
1,031
1,054
1,040
1,040
Interest coverage (x)
8
6.2
7.6
7.7
7.3
Shareholders' equity
8,936
10,236
11,385
10,830
10,749
2.2
2.5
2.2
2.3
2.4
Working capital
(640)
(177)
(786)
(1,374)
(613)
Effective tax rate
20.4
(32.9)
41.0
35.6
31.0
Total debt
25,944
29,688
28,059
29,128
29,682
3.9
3.7
3.9
3.6
23,184
26,830
26,267
27,415
27,874
ROA ROE
5.1
Net debt
25.8
19.0
16.2
16.8
16.0
L-T debt Other liabilities
Interest rate
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
10
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Major Cineplex Group (MAJOR TB) - BUY, Price Bt32.5, TP Bt40.0
Results Comment
Kalvalee Thongsomaung | Email:
[email protected]
Softened 3Q17 results as we’d expected
▪ ▪ ▪ ▪
▪
MAJOR reported softened norm profit as we had expected. The high-margin F&B and advertising were key drivers amidst the weak ticket sales,. MAJOR reported 3Q17 norm profit of Bt165m, down 10% y-y and 61% q-q (due to the seasonality affect).
▪
3Q17 ticket sales of Bt1.14bn (52% of total revenues and 20% of gross profit) were flat y-y and down 31% q-q. This was depends on the numbers of moviegoers.
Yr-end Dec (Bt m ) Revenue
(consolidated) 3Q16
4Q16
1Q17
2Q17
3Q17
2,127
1,896
2,134
2,779
2,200
Gross profit SG&A Operating profit EBITDA Other income Other expense Interest expense Profit before tax
Despite those three key businesses (ticket sales, F&B and advertising) had improved y-y, MAJOR had a loss from its movie content in 3Q17. As a result, its gross margin lowered to 32.4% vs. 36.6% in 3Q16.
▪
3Q17 concession (F&B) sales of Bt410m (19% of total revenues and 37% of gross profit) up 23% y-y, but down 25% q-q. Its portion of concession revenue to ticket sales increased to 36% in 3Q17 vs. 33.5% in 2Q17 and 29.6% in 3Q16, thanks to its marketing and campaign.
Incom e Statem ent
3Q17 advertising revenues of Bt345m (16% of total revenues and 42% of gross profit) decreased 5% y-y and 1% q-q. The lower was due to the contract expiry of one namingsponsorship.
779
596
716
1,053
712
595
701
553
570
601
184
(105)
163
482
111
485
215
506
771
480
43
95
35
37
61
0
0
0
0
0
34
37
39
36
33
193
(47)
159
483
139
Given we expect to see MAJOR’s strong earnings catalysts in 4Q17F on its great Hollywood movies line-up, we maintain BUY.
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
Norm alized profit
183
3
148
428
165
EPS (Bt) Normalized EPS (Bt)
0.37
0.10
0.29
0.00
0.17
0.48
3Q16
4Q16
1Q17
2Q17
0.18
3Q17
551
531
632
671
805
1,151
1,256
1,280
1,173
1,314
(consolidated)
Cash & equivalent A/C receivable
0.34
0.21
Balance Sheet Yr-end Dec (Bt m )
0.62
72
1,049
1,485
(1)
78
2,262
2,794
66
40
102
130
144
(60)
(29)
71
331
447
3
22
83
247
252
na
na
46
(20)
(22)
8
(8)
157
240
0
(45)
(9)
96
1,170
1,273 1,273
Income tax Equity & invest. income
Net profit
(40)
(38)
138
52 (4)
(77)
1,491
83 137 302
2,371
145
81 (6)
3,857
2,306
1,034
130
127 554
3,355
75
74
53 1
74
1
76
41 114 262
(9)
5
(3)
8 5
(32)
(28)
53 82 85
2018F 10,285
(7)
73 (5)
2017F 9,315
(71)
69 149 333
% 2017F 76
Interest expense Profit before tax
Income tax Minority interests
y-y% 3
Other expense
Equity & invest. income Extraordinary items
9M as q-q% (21)
Minority interests Extraordinary items Net profit Norm alized profit
(61)
(10)
80
930
(45)
(9)
95
1.31
1.43
(61)
(10)
79
1.05
1.43
(%)
3Q16
4Q16
1Q17
2Q17
3Q17
Sales grow th
(2.9)
(4.1)
10.2
(0.3)
3.5
(14.3)
na
3.5
(6.6)
(39.7)
EPS (Bt) Normalized EPS (Bt) Financial Ratios
Operating profit grow th
Inventory
123
98
86
108
115
EBITDA grow th
(10.6)
(50.8)
23.6
(5.6)
(1.0)
Other current assets
478
465
438
439
400
Norm profit grow th
(12.5)
(97.5)
(8.1)
(7.9)
(9.9)
Norm EPS grow th
(12.7)
(97.5)
(8.3)
(7.9)
(9.9)
36.6
31.4
33.6
37.9
32.4
8.6
(5.5)
7.6
17.4
5.0
22.8
11.3
23.7
27.7
21.8
8.6
0.2
6.9
15.4
7.5
Investment
2,722
2,752
2,705
2,742
2,845
Fixed assets
7,410
7,591
7,437
7,342
7,210
Other assets
4,913
4,783
4,702
4,617
4,312
14,626
14,725
14,576
14,349
14,156
S-T debt
4,364
4,494
3,464
3,115
2,717
EBITDA margin
A/C payable
1,652
1,761
1,542
1,867
1,724
Norm net margin
199
165
196
268
196
Total assets
Other current liabilities L-T debt
848
764
1,595
1,426
2,263
Other liabilities
847
823
803
776
765
Minority interest
Gross margin Operating margin
D/E (x)
0.8
0.8
0.7
0.7
0.8
Net D/E (x)
0.7
0.7
0.6
0.6
0.7
14.2
5.8
13.1
21.6
14.6
2.8
2.8
3.0
3.0
2.8 37.8
96
81
80
86
90
Shareholders' equity
6,620
6,637
6,896
6,810
6,402
Interest rate
Working capital
(378)
(407)
(176)
(586)
(294)
Effective tax rate
38.0
(16.4)
33.5
26.9
Total debt
5,212
5,257
5,059
4,542
4,979
ROA ROE
5.0
0.1
4.0
11.8
4.6
10.9
0.2
8.7
25.0
10.0
Net debt
4,661
4,727
4,427
3,871
4,175
Interest coverage (x)
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
11
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Siam Makro Pcl (MAKRO TB) - SELL, Price Bt36.00, TP Bt30.00
Results Comment
Phannarai Tiyapittayarut | Email:
[email protected]
In-line 3Q17 results
▪
▪ ▪
▪
As expected, 3Q17 net profit growth slowed down to single digit at 3% y-y to Bt1,447m. There is nothing wrong with its good operations but a drag is rising SG&A from overseas expansion.
SG&A/total revenues rose to 7.9%, from 7.3% in 3Q16 on rising expenses from overseas expansion with the first branch to be launched in Cambodia in December this year.
▪
Total revenues increased by 9% y-y from 2.2% same-store sales growth, new store sales and sales from Indoguna acquired since January this year.
9M17 net profit comprised 70% of our full-year earnings forecast.
▪
We maintain our projection and our SELL call to Bt30 TP.
Gross margin on merchandise sales improved to 10.06%, up from 9.72% in 3Q16 and 9.48% in 2Q17 on higher sales mix of high-margin products.
(consolidated)
Income Statement Yr-end Dec (Bt m) Revenue
Income Statement
4Q16
1Q17
2Q17
3Q17
42,039
44,780
46,313
45,204
45,654
4,746
4,909
5,378
4,875
5,279
3,065
3,012
3,529
3,519
3,615
1,681
1,897
1,850
1,356
1,664
2,162
2,397
2,365
1,889
2,204
163
157
249
226
224
0
0
0
0
0
74
79
81
90
91
1,771
1,975
2,018
1,492
1,798
363
358
395
263
359
Equity & invest. income
0
0
0
0
0
Equity & invest. income
Minority interests
0
0
(0)
2
8
Minority interests
Net profit
0 1,408
0 1,617
0 1,622
0 1,231
0 1,447
Normalized profit
1,408
1,617
1,622
1,231
EPS (Bt) Normalized EPS (Bt)
0.29
0.34
0.34
0.26
0.29
0.34
0.34
0.26
0.30
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
3Q16
4Q16
Cash & equivalent
927
2,550
2,218
1,664
2,414
Sales growth
12.8
10.8
A/C receivable
321
445
799
772
763
Operating profit growth
10.8
16.5
10,737
13,485
13,217
10,895
11,144
EBITDA growth
10.5
1,632
2,048
1,810
1,761
1,692
Norm profit growth
12.9
0
0
0
0
0
Norm EPS growth
12.9
29,852
30,319
30,478
30,835
31,104 Gross margin
Gross profit SG&A Operating profit EBITDA Other income Other expense Interest expense Profit before tax Income tax
Extraordinary items
Yr-end Dec (Bt m)
Inventory Other current assets Investment Fixed assets Other assets Total assets S-T debt A/C payable Other current liabilities
2017F 191,089
2018F 207,545
8
11
70
22,077
24,142
3
18
72
14,837
16,366
23
(1)
67
7,240
7,775
17
2
69
9,336
10,105
(1)
37
817
Other expense 1
23
93
752
na
0
0
74
352
393
Interest expense Profit before tax
21
2
69
7,640
8,200
Income tax
37
(1)
67
1,528
1,640
na 266
na
Extraordinary items 3
na
0
0
70
6,112
6,560 6,560
Normalized profit
18
3
70
6,112
0.30
EPS (Bt) Normalized EPS (Bt)
18
3
70
1.27
1.37
18
3
70
1.27
1.37
1Q17
2Q17
3Q17
9.3
5.4
8.6
28.3
3.8
(1.0)
7.2
26.3
7.6
1.9
13.6
29.3
8.7
2.7
13.6
29.3
8.7
2.7
Financial Ratios
11.3
11.0
11.6
10.8
11.6
Operating margin
4.0
4.2
4.0
3.0
3.6
8,862
EBITDA margin
5.1
5.4
5.1
4.2
4.8
17,813
20,089
Norm net margin
3.3
3.6
3.5
2.7
3.2
7,292
5,463
3,858
4,012
6,755
6,937
7,117
52,859
55,277
52,864
54,233
4,698
3,423
5,533
7,511
19,335
23,329
20,829
3,797
6,952
7,718
0
0
0
0
0
3,413
3,651
3,710
3,705
0
20
210
323
398
Shareholders' equity
14,106
15,721
17,337
16,215
15,716
Working capital
Minority interest
Other income
% 2017F 72
1,447
5,390
Other liabilities
Operating profit EBITDA
y-y% 9
18
47,327
L-T debt
Gross profit SG&A
q-q% 1
Net profit
(consolidated)
Balance Sheet
(Bt m) Revenue
9M as
3Q16
(8,277)
(9,399)
(6,813)
(6,146)
(8,182)
Total debt
4,698
3,423
5,533
7,511
8,862
Net debt
3,771
872
3,314
5,847
6,448
D/E (x)
0.3
0.2
0.3
0.5
0.6
Net D/E (x)
0.3
0.1
0.2
0.4
0.4
Interest coverage (x)
29
30
29
21
24
Interest rate
6.5
7.8
7.2
5.5
4.4
Effective tax rate
20.5
18.1
19.6
17.6
20.0
ROA ROE
12.6
13.5
12.6
9.8
11.4
39.5
43.4
39.3
29.4
36.2
Sources: Company data, Thanachart estimates
THANACHART SECURITIES
12
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Pylon Public Co Ltd (PYLON TB) - HOLD, Price Bt14.0, TP Bt12.5
Results Comment
Saksid Phadthananarak | Email:
[email protected] Weaker-than-expected 3Q17 results
▪
▪
▪
PYLON reported normalized earnings of Bt5m in 3Q17, down 89% y-y and 70% q-q. This was lower than what we had expected. The significant fall in earnings year on year and quarter on quarter was due to a drop in revenues given its low backlog value in 3Q17 and a plunge in gross margin from lower utilization rate given its low backlog value.
PYLON’s revenues fell by 63% y-y in 3Q17 on lower revenue recognition given its low backlog value in 3Q17. Given a lower utilization rate, its gross margin fell to 16.2% in 3Q17 from 23% in 3Q16.
▪
Key risk: Delays to the government’s infrastructure projects and private construction projects could impact our new work value assumptions. Delays could also hurt PYLON’s gross margin given its high operating leverage.
Even though 9M17 results made up 59% of our full-year forecasts, we expect its earnings to turn around in 4Q17 as its backlog value already improved to Bt552m as of 11 September 2017 from Bt391m in 2Q17 and Bt78m in 1Q17. We believe that PYLON will be one of the biggest beneficiaries from the government’s infrastructure investment cycle but we currently have a HOLD rating on PYLON as its share price now trades close to our fair value.
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue
3Q16
4Q16
1Q17
2Q17
291
274
254
169
107
67
75
78
29
17
18
18
16
18
18
49
58
62
12
(1)
Gross profit SG&A Operating profit EBITDA
3Q17
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA
61
70
76
26
14
Other income
2
4
2
1
1
Other income
Other expense
0
0
0
0
0
Other expense Interest expense Profit before tax
Interest expense Profit before tax
0
0
0
0
0
51
61
64
12
0
Income tax
y-y% (63)
(41)
(74)
2
2
na
% 2017F 60
2017F 881
2018F 1,300
62
203
338
85
62
65
na
52
141
273
(48)
(78)
59
197
340
4
(57)
32
13
20
(10)
(24)
106
1
1
(100)
(100)
50
154
292
na
na
(1)
23
58
Net profit
(70)
(89)
59
131
233
Norm alized profit
(70)
(89)
59
131
233
(70)
(89)
59
0.35
0.62
(70)
(89)
59
0.35
0.62
(%)
Income tax
10
8
8
(4)
(5)
Equity & invest. income
0
0
0
0
0
Minority interests
0
0
0
0
0
Minority interests Extraordinary items
Extraordinary items
9M as q-q% (36)
Equity & invest. income
Net profit
0 42
(0) 53
0 56
0 16
0 5
Norm alized profit
42
53
56
16
5
0.11
0.14
0.15
0.04
0.01
0.11
0.14
0.15
0.04
0.01
3Q16
4Q16
1Q17
2Q17
3Q17
3Q16
4Q16
1Q17
2Q17
3Q17
90
111
206
147
210
Sales grow th
14.8
2.5
3.8
(33.4)
(63.1)
159
306
304
222
141
Operating profit grow th
35.7
(8.6)
19.5
(61.8)
38
34
35
33
30
EBITDA grow th
29.7
(5.8)
19.1
(37.9)
(77.5)
368
191
118
116
72
Norm profit grow th
28.5
(4.4)
18.8
(47.9)
(88.6)
0
0
0
0
0
Norm EPS grow th
28.5
(4.4)
18.8
(47.9)
(88.6)
Fixed assets
313
358
386
375
369
Other assets
23
16
17
30
38
Gross margin
23.0
27.6
30.9
17.5
16.2
Operating margin
16.9
21.0
24.4
7.0
(0.7)
EBITDA margin
21.1
25.6
29.8
15.6
12.8
Norm net margin
14.3
19.3
22.1
9.5
4.4
EPS (Bt) Normalized EPS (Bt)
(consolidated)
Balance Sheet Yr-end Dec (Bt m ) Cash & equivalent A/C receivable Inventory Other current assets Investment
Total assets
991
1,016
1,065
923
859
8
8
10
9
8
A/C payable
130
115
84
52
40
Other current liabilities
101
89
115
65
65
S-T debt
L-T debt
5
4
2
1
1
Other liabilities
9
9
10
11
12
Minority interest Shareholders' equity
0
0
0
0
0
738
791
844
785
733
Working capital
67
225
255
204
130
Total debt
13
12
13
11
9
Net debt
(77)
(99)
(193)
(136)
(200)
EPS (Bt) Normalized EPS (Bt) Financial Ratios
D/E (x) Net D/E (x)
na
0.0
0.0
0.0
0.0
0.0
(0.1)
(0.1)
(0.2)
(0.2)
(0.3)
221.7
279.2
297.0
112.7
65.3
8.0
8.2
8.5
8.0
8.4
Effective tax rate
18.6
13.7
12.5
(28.5)
na
ROA ROE
16.7
21.1
21.6
6.5
2.1
21.8
27.6
27.4
7.9
2.5
Interest coverage (x) Interest rate
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
13
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Rajthanee Hospital (RJH TB) - BUY, Price Bt28.0, TP Bt31.5
Results Comment
Siriporn Arunothai | Email:
[email protected]
Very strong 3Q17 results, above expectation
▪
▪
▪
RJH reported very strong net profit at Bt72m in 3Q17, up 47% y-y and 63% q-q. This was pretty much above ours and the street’s earnings forecasts due to its higher-than-expected revenue and margin. Strong earnings growth was driven by improving revenue from all kinds of patients (cash, Social Security (SS) Scheme and Universal Coverage Scheme) in main campus and improving operation of Rajthanee Rojana Hospital (RRH). Improving revenue also boosted its operating margin to improve from 18.4% in 3Q16 and 16.8% in 2Q17 to 22.7% in 3Q17.
(consolidated)
Income Statement Yr-end Dec (Bt m) Revenue
3Q16
4Q16
1Q17
2Q17
3Q17
318
316
314
332
390
95
80
87
94
128
Gross profit SG&A Operating profit EBITDA
36
38
35
38
39
58
42
51
56
89
77
Other income
3
Other expense
0
Interest expense Profit before tax
7
Income tax Equity & invest. income
60 6 0
5 0
5 0
Operating profit EBITDA
5
Other income
0
Other expense
45
56
60
93
2
8
0
11
19
Income tax
0
1
109
Gross profit SG&A
54
0
1
75
Income Statement (Bt m) Revenue
Interest expense Profit before tax
0
2
70
9M17 earnings accounted for 85% of our full-year earnings forecast. We see its strong earnings growth to continue in 4Q17F due to rising number of cash patients and an increase in reimbursement rate under SS scheme from 1 July 2017. RJH is still our top sector pick BUY.
0
1
0
(3)
(2)
(15)
(5)
(3)
Minority interests
Extraordinary items
0 36
18 59
0 44
0 72
Extraordinary items
Net profit
0 49
Normalized profit
49
36
41
44
72
0.16
0.12
0.20
0.15
0.24
0.16
0.12
0.14
0.15
0.24
3Q16
4Q16
1Q17
2Q17
3Q17
Cash & equivalent
775
201
90
126
A/C receivable
251
219
254
300
(consolidated)
Balance Sheet Yr-end Dec (Bt m)
Inventory Other current assets Investment Fixed assets Other assets Total assets
387
440
70
161
167
59
52
87
226
273
45
41
84
303
357
4
76
79
19
25
0
0
(49)
(92)
68
4
3
56
72
87
241
295
76
693
119
25
59
81
0
0
(27)
(16)
na
na
100
19
0
Net profit
63
47
85
207
219
Normalized profit
63
47
83
189
219
EPS (Bt) Normalized EPS (Bt)
63
47
85
0.69
0.73
63
47
83
0.63
0.73
3Q17
Financial Ratios 1Q17
2Q17
18.6
6.4
18.4
22.8
297
Operating profit growth
105.3
26.7
(7.4)
41.0
51.9
22
20
19
20
21
64.5
16.6
(4.8)
30.0
41
3
513
610
509
212
Norm profit growth
145.1
43.6
(2.1)
55.6
47.5
Norm EPS growth
83.8
7.7
(26.6)
16.7
47.5
Gross margin
29.8
25.3
27.7
28.3
32.7
Operating margin
18.4
13.2
16.4
16.8
22.7
0
0
0
0
0
762
769
771
783
788
131
130
1,868
1,831
72
25
26
30
1
148
172
146
150
168 14
EBITDA growth
EBITDA margin
24.3
19.1
22.4
22.7
27.9
Norm net margin
15.4
11.3
13.0
13.3
18.4
0
3
11
16
133
57
48
40
1
33
25
28
28
29
Net D/E (x) Interest coverage (x)
3
51
66
71
73
1,523
1,490
1,549
1,534
1,546
124
66
127
169
149
Working capital
80
7
4Q16
131
Minority interest Shareholders' equity
35
2
23.8
1,875
Other liabilities
36
3Q16
102
L-T debt
2018F 1,495
Sales growth
1,824
Other current liabilities
2017F 1,376
383
100
S-T debt
% 2017F 75
(%)
1,912
A/C payable
y-y% 23
Equity & invest. income
Minority interests
EPS (Bt) Normalized EPS (Bt)
9M as q-q% 18
Total debt
205
82
74
70
2
Net debt
(570)
(119)
(16)
(56)
(381)
D/E (x)
0.1
0.1
0.0
0.0
0.0
(0.4)
(0.1)
(0.0)
(0.0)
(0.2)
11
28.2
56.6
65.4
Interest rate
6.8
6.0
6.4
6.4
6.5
Effective tax rate
4.3
17.3
17.7
20.0
ROA ROE
-
186.3
12.8
7.7
8.8
9.4
15.6
21.3
9.5
10.7
11.5
18.7
Sources: Company data, Thanachart estimates
THANACHART SECURITIES
14
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Robinson Pcl (ROBINS TB) - BUY, Price Bt72.25, TP Bt77.00
Results Comment
Phannarai Tiyapittayarut | Email:
[email protected]
Good 3Q17 results, in line
▪ ▪
▪
▪
ROBINS reported good 3Q17 net profit as expected, up 20% y-y and 2% q-q to Bt611m, slightly beats our forecast of 18% growth y-y. Key driver was a 17% increase in rental income due to rental revenues from two new lifestyle malls at Lopburi and Petchburi, higher average occupancy rate of 99% (up y-y and q-q from 98%) and rate increase at renovated malls in Saraburi and Ratchaburi. At present, ROBINS has 19 lifestyle malls.
Gross margin fell by 14bp y-y to 24.2%, in line with our forecast as it is in product transition period and was much better than a decline by 41bp y-y in 2Q17. We expect gross margin expansion to resume in 4Q17F.
▪ ▪
9M17 net profit accounted for 71% of our full-year forecast. We maintain our earnings projection and our BUY call to Bt77 TP.
Sales revenues were up 3% y-y and 6% q-q from new store sales. Same-store sales were almost flat at -0.1% (improved significantly from -4.7% in 2Q17), driven by good SSSG in September.
(consolidated)
Income Statement Yr-end Dec (Bt m) Revenue Gross profit SG&A
3Q16
4Q16
1Q17
2Q17
3Q17
6,237
7,353
6,271
6,021
6,394
1,517
1,847
1,584
1,489
1,546
1,902
2,057
1,822
1,919
1,968
575
793
775
627
686
917
1,275
1,190
1,067
1,161
960
1,003
1,013
1,056
1,108
0
0
0
0
0
Operating profit EBITDA Other income Other expense
Income Statement (Bt m) Revenue Gross profit SG&A Operating profit EBITDA Other income
y-y% 3
% 2017F 70
2017F 26,857
2018F 29,987
4
2
69
6,698
7,608
3
3
71
8,058
8,913
9
19
70
2,966
3,542
9
27
66
5,169
5,903
5
15
73
4,326
4,848
na
0
0
Other expense 19
(14)
61
92
89
667
Interest expense Profit before tax
9
21
71
2,874
3,453
121
Income tax
12
9
71
532
691
(25)
(6)
69
540
603
na
na
66
(163)
(150)
na
0
0
Interest expense Profit before tax
23
21
20
16
19
553
772
755
610
Income tax
111
162
147
109
Equity & invest. income
103
152
147
129
97
Minority interests
(35)
(47)
(46)
(30)
(32)
Minority interests
Extraordinary items
0 510
295 1,010
0 710
0 601
0 611
Extraordinary items
Net profit
9M as q-q% 6
Equity & invest. income
Net profit
2
20
71
2,719
3,216
Normalized profit
510
715
710
601
611
Normalized profit
2
20
71
2,719
3,216
EPS (Bt) Normalized EPS (Bt)
0.46
0.91
0.64
0.54
0.55
2
20
71
2.45
2.90
0.46
0.64
0.64
0.54
0.55
EPS (Bt) Normalized EPS (Bt)
2
20
71
2.45
2.90
Yr-end Dec (Bt m)
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
3Q17
Cash & equivalent
1,093
2,219
1,722
1,004
1,531
Sales growth
794
1,060
757
734
725
2,078
1,971
1,904
1,958
2,058
EBITDA growth
523
474
503
516
570
Norm profit growth Norm EPS growth Gross margin
(consolidated)
Balance Sheet
A/C receivable Inventory Other current assets Investment
2,323
2,737
2,675
2,804
2,901
Fixed assets
9,919
9,837
9,940
9,555
9,671
Other assets
Financial Ratios
Operating profit growth
3Q16
4Q16
1Q17
2Q17
3.4
1.3
(1.9)
(1.2)
2.5
25.3
11.1
(2.5)
(4.2)
19.2
(5.4)
1.0
(7.5)
(9.2)
26.6
28.3
12.2
3.4
(1.4)
19.8
28.3
12.2
3.4
(1.4)
19.8
24.3
25.1
25.3
24.7
24.2
9.2
10.8
12.4
10.4
10.7
8,360
8,704
8,787
9,218
9,052
25,091
27,001
26,289
25,790
26,509
100
0
5
1,500
1,106
EBITDA margin
14.7
17.3
19.0
17.4
18.2
A/C payable
3,750
4,246
3,741
3,621
3,993
Norm net margin
8.2
9.7
11.3
10.0
9.6
Other current liabilities
2,728
3,121
2,683
2,710
2,792
L-T debt
Total assets S-T debt
Operating margin
3,208
3,267
2,740
1,729
1,761
D/E (x)
0.2
0.2
0.2
0.2
0.2
Other liabilities
164
169
171
181
179
Net D/E (x)
0.2
0.1
0.1
0.1
0.1
Minority interest
990
1,037
1,083
974
991
Interest coverage (x)
40
60
60
64
60
14,150
15,160
15,865
15,075
15,685
Interest rate
2.5
2.6
2.6
2.2
2.6
Working capital
(878)
(1,215)
(1,080)
(929)
(1,210)
Effective tax rate
20.1
21.0
19.4
17.8
18.2
Total debt
3,308
3,267
2,745
3,229
2,867
8.1
11.0
10.7
9.2
9.3
Net debt
2,215
1,048
1,023
2,224
1,336
14.7
19.5
18.3
15.5
15.9
Shareholders' equity
ROA ROE
Sources: Company data, Thanachart estimates
THANACHART SECURITIES
15
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
SAPPE Pcl (SAPPE TB) - SELL, Price Bt31.75, TP Bt22.50
Results Comment
Rata Limsuthiwanpoom | Email:
[email protected]
Good 3Q17 in-line
▪
▪
▪
SAPPE reported good, in-line 3Q17 net profit of Bt112m, rising by 19% y-y but falling by 32% q-q. Excluding FX gain, normalized profit would have been Bt108m, rising by 18% y-y but falling by 33% q-q.
▪
Main driver for y-y earnings growth were 1) rising revenue driven by export sales (65% of sales); 2) falling SG&A/sales given larger sales base; 3) equity income from All Coco turned to profit of Bt3m in 3Q17 vs. –Bt0.3m in 2Q17. SAPPE purchased All Coco stake in 4Q16.
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue
3Q16
4Q16
1Q17
2Q17
652
643
497
845
724
277
278
180
360
276
Gross profit SG&A
3Q17
Meanwhile, falling earnings q-q was due to falling revenue on seasonality effect and falling gross profit margin, while SG&A/sales rose. Please note 2Q17 was a high revenue base given normally high season for exports. We expect SAPPE’s earnings growth in 4Q17 to continue to fall q-q given seasonality effect, but it should grow y-y as 4Q16 had mourning impact. Maintain SELL for expensive valuation.
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A
9M as q-q% (14)
y-y% 11
% 2017F 69
2017F 2,974
2018F 3,249
(23)
(0)
61
1,340
1,487
(8)
(11)
54
842
919
(37)
17
73
498
567
(30)
12
74
653
730
(12)
11
66
45
49
173
203
129
168
155
104
75
51
192
121
144
116
91
232
162
Other income
9
11
7
12
11
Other expense
0
0
0
0
0
Other expense Interest expense Profit before tax
(21)
33
94
0
0
(35)
16
73
543
616
Income tax
(37)
2
77
109
123
na
na
(73)
(1)
0
185
(97)
na
0
0
Operating profit EBITDA
Interest expense Profit before tax Income tax Equity & invest. income
0
0
0
0
0
113
86
58
204
132
27
19
13
43
27
0
Minority interests Extraordinary items Net profit Norm alized profit
(3)
(2)
(0)
Operating profit EBITDA Other income
3
Equity & invest. income Minority interests
5
1
(0)
0
0
2 94
32 97
6 49
3 163
4 112
Extraordinary items
43
56
na
0
0
Net profit
(32)
19
75
433
493
Norm alized profit
(33)
18
72
433
493
(32)
19
75
1.43
1.63
(33)
18
72
1.43
1.63
(%)
3Q17
91
65
43
161
108
0.31
0.32
0.16
0.54
0.37
0.30
0.21
0.14
0.53
0.36
3Q16
4Q16
1Q17
2Q17
3Q17
3Q16
4Q16
1Q17
2Q17
Cash & equivalent
465
359
119
332
162
Sales grow th
24.5
1.7
(16.2)
2.4
11.0
A/C receivable
257
373
421
448
420
Operating profit grow th
39.9
331.4
(20.4)
9.6
16.9
Inventory
189
157
204
191
184
EBITDA grow th
44.7
122.5
(11.1)
8.2
12.2
Other current assets
239
234
457
344
616
Norm profit grow th
23.3
100.5
(33.6)
7.0
18.4
0
0
0
0
0
Norm EPS grow th
22.9
99.8
(33.7)
6.9
18.4
1,154
1,112
1,093
1,060
1,046 Gross margin
42.4
43.3
36.3
42.6
38.1
Operating margin
15.9
11.7
10.3
22.7
16.8
EBITDA margin
22.1
18.1
18.3
27.5
22.3
Norm net margin
14.0
10.1
8.6
19.0
14.9
EPS (Bt) Normalized EPS (Bt)
(consolidated)
Balance Sheet Yr-end Dec (Bt m )
Investment Fixed assets Other assets Total assets
103
216
215
215
216
2,408
2,452
2,508
2,590
2,643
4
4
4
5
5
407
382
370
453
415
28
46
59
56
27
0
0
0
0
0
S-T debt A/C payable Other current liabilities L-T debt
EPS (Bt) Normalized EPS (Bt) Financial Ratios
D/E (x)
0.0
0.0
0.0
0.0
0.0
(0.2)
(0.2)
(0.1)
(0.2)
(0.1)
Other liabilities
20
19
19
20
21
Net D/E (x)
Minority interest
43
(4)
(4)
(4)
(4)
Interest coverage (x)
na
na
na
na
na
1,905
2,005
2,060
2,060
2,180
Interest rate
3.0
3.3
3.3
5.2
3.6
Shareholders' equity
39
148
255
186
189
Total debt
Working capital
4
4
4
5
5
Net debt
(461)
(354)
(115)
(327)
(156)
Effective tax rate
23.6
21.8
23.0
21.1
20.7
ROA ROE
15.2
10.6
6.9
25.2
16.5
19.6
13.2
8.4
31.2
20.4
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
16
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Sri Trang Agro-Indus. (STA TB) - BUY, Price Bt12.60, TP Bt25.00
Results Comment
Kalvalee Thongsomaung | Email:
[email protected]
Norm loss 3Q17 results
▪
▪ ▪
▪
STA reported normalized loss of Bt228m vs. a norm loss of Bt2.1bn in 2Q17 vs. a norm loss of Bt230m in 3Q16. The loss making was mainly due to its operational pressure from SICOM price volatility and an unusual gap between SICOM and raw material markets.
Revenue from technically specified rubber (TSR) as its core product (65% of total revenue) decreased by 15% y-y, due mainly to lower selling volumes.
▪
Global rubber price remains in a pressure and we don't see clear catalysts. We thus do not expect positive momentum to STA share price as it highly moves along the global rubber price.
Noted that STA recorded gain from FX, gain from asset revaluation and other gains combined at Bt394m in 3Q17.
▪
Total sales were at Bt18.2bn in 3Q17, down 6% y-y and 20% q-q. The y-y decline was mainly due to a lower selling volume while the q-q decline was mainly due to a lower selling price.
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA
3Q16
4Q16
1Q17
2Q17
19,309
22,510
28,519
22,875
18,224
1,037
1,621
1,899
(811)
1,314
1,234
1,952
1,551
1,320
1,124
(197)
(331)
348
(2,130)
190
Other income Other expense Interest expense Profit before tax
102
2
685
(1,674)
699
49
(5)
215
62
45
0
0
0
0
0
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
7,023
70
5,716
6,293
na
na
(122)
1,307
2,132
2,523
3,516
248
303
na
588
(12)
(28)
(10)
130
799
820 1,615
Income tax
na
304
41
113
291
83
Equity & invest. income
na
(26)
104
80
80
Minority interests
na
na
49
41
51
821
182
(44)
(475)
0
Net profit
na
na
(662)
288
1,456
Norm alized profit
na
na
(277)
763
1,456
na
na
(662)
0.22
1.14
na
na
(277)
0.60
1.14
52
(321)
142
(307)
211
Net profit
34
(9)
756
Interest expense Profit before tax
Extraordinary items
27
113
(94)
(57)
8,425
na (15)
(288)
328
(2,379)
58
2018F 124,438
na
310
299
101
2017F 99,755
132
264
112
% 2017F 70
6
320 (657)
Minority interests
y-y% (6)
na
142
Income tax
9M as q-q% (20)
Other expense
(289)
Equity & invest. income
Norm alized profit
3Q17
Noted that our valuation has yet incorporated STA’s dilution impact at 17% from its capital increase via right offering. STA’s new 256m shares has traded on 16 October 2017.
(1)
12
19
6
(5)
140 (91)
(1,081) (1,303)
(226) 8
43 (2,080)
394 167
Extraordinary items
(230)
(222)
234
(2,123)
(228)
(0.07)
(1.02)
0.01
(1.63)
0.13
(0.18)
(0.17)
0.18
(1.66)
(0.18)
Yr-end Dec (Bt m )
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
3Q16
4Q16
1Q17
2Q17
3Q17
Cash & equivalent
1,398
1,675
1,856
2,136
1,902
Sales grow th
18.9
45.5
70.8
22.0
(5.6)
A/C receivable
6,953
8,093
10,576
7,512
7,148
Operating profit grow th
na
na
na
na
na
13,876
20,931
26,829
18,789
19,715
EBITDA grow th
na
na
na
na
na
843
1,113
1,128
1,191
1,554
Norm profit grow th
na
na
na
na
na
1,422
1,490
408
443
490
Norm EPS grow th
na
na
na
na
na
15,605
15,766
19,894
20,108
23,057
EPS (Bt) Normalized EPS (Bt)
(consolidated)
Balance Sheet
Inventory Other current assets Investment Fixed assets Other assets Total assets S-T debt A/C payable
Financial Ratios
6,426
6,891
6,475
6,954
6,779
46,522
55,959
67,167
57,133
60,646
Operating margin
16,207
28,840
35,152
29,732
29,985
EBITDA margin
2,479
3,168
3,571
2,292
2,548
322
828
1,539
412
306
5,919
2,871
5,781
6,299
6,703
Other current liabilities L-T debt
EPS (Bt) Normalized EPS (Bt)
Other liabilities
Gross margin
Norm net margin
5.4
7.2
6.7
(3.5)
7.2
(1.0)
(1.5)
1.2
(9.3)
1.0
0.5
0.0
2.4
(7.3)
3.8
(1.2)
(1.0)
0.8
(9.3)
(1.2)
D/E (x)
1.0
1.6
2.1
2.1
1.9
Net D/E (x)
1.0
1.5
2.0
2.0
1.8 2.1
353
340
741
711
1,146
76
64
635
625
627
Interest coverage (x)
0.7
0.0
2.6
(5.4)
Shareholders' equity
21,166
19,848
19,749
17,062
19,332
Interest rate
2.7
4.8
2.9
3.2
Working capital
18,349
25,856
33,835
24,008
24,316
Effective tax rate
(18.1)
48.9
47.4
12.9
Total debt
22,125
31,711
40,933
36,031
36,688
(1.7)
1.5
(13.7)
(1.5)
20,727
30,036
39,077
33,895
34,786
ROA ROE
(2.0)
Net debt
(4.3)
(4.3)
4.7
(46.1)
(5.0)
Minority interest
3.6 (225.0)
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
17
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Sino Thai Eng. & Const. (STEC TB) - BUY, Price Bt24.9, TP Bt33.0
Results Comment
Saksid Phadthananarak | Email:
[email protected] Slightly weaker-than-expected 3Q17 results
▪
▪
▪
STEC reported normalized earnings of Bt217m in 3Q17, down 7% y-y and 11% q-q. This was slightly lower than what we had expected. A fall in earnings year on year was due to still low revenue recognition from its record-high backlog value while the fall in earnings quarter on quarter was due to lower gross margin. 9M17 results made up 67% of our full-year earnings forecast.
▪
We still expect STEC to report higher earnings in 4Q17 due to higher revenue recognition from its record-high backlog value. We expect STEC’s backlog value of Bt102bn at end 3Q17. Besides expected strong earnings growth from its record-high backlog value in 2018 onward, we like STEC for its solid financial status with a net cash position and we expect it to be one of the biggest beneficiaries from the government’s massive infrastructure investment. We reiterate a BUY call on STEC.
Its gross margin fell to 8% in 3Q17 from 8.5% in 2Q17. We believe this was due to a higher proportion of revenue recognition from the zero-margin new parliament building project.
▪
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue
STEC’s revenues fell by 4% y-y in 3Q17 despite its record-high backlog value. This may be due to the impact of the rainy seasons and new construction projects being yet to start.
Key risks: Fluctuations in building material prices present a major risk to our earnings projections. Delays of infrastructure projects are another concern.
Incom e Statem ent
3Q16
4Q16
1Q17
2Q17
3Q17
4,823
4,839
5,011
4,416
4,641
388
454
411
374
371
111
212
118
134
134
277
242
293
240
237
409
371
413
356
353
16
21
15
47
23
0
0
0
0
0
Other expense Interest expense Profit before tax
Gross profit SG&A Operating profit EBITDA Other income Other expense Interest expense Profit before tax Income tax Equity & invest. income Minority interests Extraordinary items
3
6
5
5
6
289
257
303
282
254
61
57
61
52
41
7
8
9
14
6
(2)
(10)
(2)
(1)
(2)
(Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
378 15
na
na
(152)
3
4
Net profit
(11)
(7)
67
1,066
1,533
Norm alized profit
(11)
(7)
67
1,066
1,533
(11)
(7)
67
0.70
1.01
(11)
(7)
67
0.70
1.01
3Q16
4Q16
1Q17
2Q17
3Q17
2.8
9.3
11.7
16.1
(3.8)
(7.2)
(21.5)
(1.8)
3.2
(14.6)
Minority interests Extraordinary items
0.16
0.14
Yr-end Dec (Bt m )
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
Cash & equivalent
2,759
1,890
2,191
1,097
5,606
Sales grow th
A/C receivable
9,285
8,791
8,939
8,710
9,223
Operating profit grow th
Inventory
3,887
4,079
3,150
3,733
3,911
926
889
839
698
892
Investment
4,365
6,422
6,336
7,297
7,101
Fixed assets
2,988
2,886
2,824
2,971
3,087
Other assets
37
44
65
31
32
4,215
3,991
4,495
4,964
8,909
8,297
8,089
12,682
EPS (Bt) Normalized EPS (Bt) Financial Ratios
(5.9)
(9.7)
(3.6)
(1.6)
(13.6)
Norm profit grow th
EBITDA grow th
(13.6)
(21.7)
(7.0)
19.0
(7.2)
Norm EPS grow th
(13.6)
(21.7)
(7.0)
19.0
(7.2)
Gross margin
8.0
9.4
8.2
8.5
8.0
Operating margin
5.7
5.0
5.8
5.4
5.1
EBITDA margin
8.5
7.7
8.3
8.1
7.6
Norm net margin
4.8
4.1
5.0
5.5
4.7
0.0
0.1
0.1
0.1
0.1
(0.3)
(0.1)
(0.1)
(0.0)
(0.4)
123.9
64.8
76.5
69.5
60.4
7.3
5.3
3.2
2.8
3.0
Effective tax rate
20.9
22.2
20.2
18.3
16.3
ROA ROE
4.0
3.2
4.0
4.0
3.2
10.0
8.0
9.6
9.3
8.3
L-T debt
113
101
100
150
179
D/E (x)
Other liabilities
450
615
605
615
611
Net D/E (x) Interest coverage (x)
Minority interest Shareholders' equity Working capital
222
232
233
235
236
9,496
10,353
10,529
10,344
10,554
9,164
8,654
8,098
7,948
8,169
Total debt
192
676
688
759
805
Net debt
(2,567)
(1,214)
(1,503)
(338)
(4,801)
113
15
0.16
4,008
2,417
73
262
0.13
9,878
1,834
116
59
0.15
A/C payable
61
46
196
0.14
Other current liabilities
(14)
(7)
0.16
626
(1) (51)
(32)
0.16
29,852
1,802
(20)
0.44
609
1,259
(57)
0.15
24,536
61
Equity & invest. income
217
587
(15)
Income tax
243
24,343
623
(2)
22
249
575
467
1,892
198
25,000
1,725
83
22
233
79
67
21
1,310
Norm alized profit
24,247
(4)
0
75
0 217
Total assets
2,425
(1)
64
0 243
S-T debt
2018F 27,100
77
0 249
Other current assets
2017F 20,299
(12)
477 675
(consolidated)
% 2017F 69
14
0 233
Balance Sheet
y-y% (4)
(10)
Net profit EPS (Bt) Normalized EPS (Bt)
9M as q-q% 5
Interest rate
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
18
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
SUSCO Pcl (SUSCO TB) - BUY, Price Bt4.12, TP Bt5.50
Results Comment
Chak Reungsinpinya | Email:
[email protected] Nuttapop Prasitsuksant, Assistant Analyst | Email:
[email protected]
3Q17, a new record-high quarter
▪
▪
▪
▪
SUSCO reported normalized profit of Bt104m in 3Q17, up 94% y-y and 70% q-q, a new record-high quarterly profit for the company. Better-than-expected profit was due to a strong volume growth in spite of a low-season period for oil demands, and a good cost control. Total sale volume of 290m liters grew by 15% y-y and 3% q-q. Strong momentum of y-y growth continues after -1% growth in 1Q17 and 6% in 2Q17, while the q-q growth was a big surprise since 3Q is normally the low season of oil demands.
The margin improved significantly to Bt1.18/liter in 3Q17, from Bt1.05 in 2Q17 and Bt1.08 in 3Q16, which we believe was due to a high gasoline’s marketing margin, and higher portion of export volume. A good cost control resulted as lower SG&A expense to sale volume of Bt0.99/liter in 3Q17, from Bt1.05 in 2Q17 and Bt1.08 in 3Q16.
▪
Non-oil businesses income dropped 4% from 3Q16 due to lower LPG stations management fee and dividend income.
▪
The results confirm our view of stronger oil demand in 2H17F from a flat growth y-y in 1H17. Together with a low-base effect in 4Q16, we expect strong earnings growth momentum continues for SUSCO. BUY.
Key driver was the export volume, up 44% y-y, while growths of domestic and jet fuel volumes outpaced the industry (9% vs. 4%, and 4% vs. 3% respectively).
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue
3Q16
4Q16
1Q17
2Q17
3Q17
4,606
5,233
5,960
5,638
5,666
353
364
380
373
419
Gross profit SG&A
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A
9M as q-q% 0
y-y% 23
12
19
(10)
(1)
289
287
301
317
286
64
77
79
57
133
125
144
149
124
195
Other income
3
0
0
13
3
Other income
Other expense
0
0
0
0
0
Other expense
Interest expense Profit before tax
9
9
7
6
7
58
69
72
63
129
Interest expense Profit before tax
104
2
8
8
117
26
Income tax
(78)
Operating profit EBITDA
Income tax Equity & invest. income
(1)
Minority interests Extraordinary items Net profit Norm alized profit
(5)
(1)
(1)
Operating profit EBITDA
0
Equity & invest. income Minority interests
0
0
0
0
0
2 56
(1) 57
(14) 63
(116) (55)
0 104
1,595
1,736
76
1,194
1,244
108
67
402
492
57
56
70
669
771
(78)
(13)
82
19
19
na
0
0
54
37
37
14
na
(23) 121
69
384
475
1,324
258
59
75
na
na
0
0
na
0
0
100
(130)
0
86
57
195
400
Norm alized profit
70
94
74
325
400
na
86
57
0.18
0.36
70
94
74
0.30
0.36
3Q16
4Q16
1Q17
2Q17
3Q17
4.3
10.5
27.9
16.6
23.0
200.1
111.0
(13.0)
(44.4)
108.0
58
77
61
104
0.06
(0.05)
0.09
0.05
0.05
0.07
0.06
0.09
3Q16
4Q16
1Q17
2Q17
3Q17
Cash & equivalent
381
413
397
345
428
Sales grow th
A/C receivable
490
654
654
655
651
Operating profit grow th
(consolidated)
73
na
0.05
Balance Sheet
2018F 28,446
Net profit
53
Yr-end Dec (Bt m )
2017F 24,551
135
Extraordinary items
0.05
EPS (Bt) Normalized EPS (Bt)
% 2017F 70
EPS (Bt) Normalized EPS (Bt) Financial Ratios (%)
Inventory
534
558
568
497
530
EBITDA grow th
51.7
45.9
(2.9)
(24.1)
55.8
Other current assets
195
231
242
191
213
Norm profit grow th
1,500.5
181.6
16.4
(33.8)
93.8
Investment
1,460
1,417
1,436
1,508
1,518
Norm EPS grow th
1,500.5
181.6
16.4
(33.8)
93.8
Fixed assets
1,450
1,472
1,433
1,429
1,438 Gross margin
7.7
7.0
6.4
6.6
7.4
Operating margin
1.4
1.5
1.3
1.0
2.4
EBITDA margin
2.7
2.8
2.5
2.2
3.4
Norm net margin
1.2
1.1
1.3
1.1
1.8
Other assets Total assets
722
726
750
733
771
5,232
5,471
5,480
5,356
5,548
431
555
508
388
385
S-T debt A/C payable
800
992
1,065
875
1,016
Other current liabilities
268
298
258
268
240
L-T debt
236
84
3
200
178
D/E (x)
0.2
0.2
0.1
0.2
0.2
Other liabilities
197
192
200
228
231
Net D/E (x)
0.1
0.1
0.0
0.1
0.0
0
0
0
0
0
Minority interest Shareholders' equity
Interest coverage (x)
14
17
21
21
29
Interest rate
5.2
5.2
4.9
4.3
4.7 19.9
3,300
3,351
3,446
3,397
3,497
Working capital
224
221
156
277
164
Effective tax rate
3.1
11.8
11.5
185.0
Total debt
667
639
511
588
563
4.1
4.3
5.6
4.5
7.6
Net debt
286
226
114
244
135
ROA ROE
6.5
7.0
9.1
7.1
12.0
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
19
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
SVI Public Co Ltd (SVI TB) - SELL, Price Bt5.05, TP Bt4.50
Results Comment
Chak Reungsinpinya | Email:
[email protected] Nuttapop Prasitsuksant, Assistant Analyst | Email:
[email protected]
Weak 3Q17 results on low gross margin
▪
▪
▪
▪
SVI reported normalized profit (excluded Bt7m FX gain) of Bt71m in 3Q17, down 61% y-y and 43% q-q, missed our and consensus’ expectations. Weak result was due to a low gross margin, impacted by high raw material costs and strong baht. We see a downside risk to our numbers since 9M17’s normalized profits were only 56% of our full-year forecast.
▪
Total US$ revenue of US$95m, up 17% y-y and 4%, was inline with our expectations. Strong revenue growth was driven by the started mass productions of orders from new customers secured during 1H17.
▪
Gross margin contracted to 5.8% in 3Q17, from 8.7% in 2Q17 and 9.5% in 3Q16. Decreased margin was from high raw material costs during a shortage environment due to a boom of semiconductor industry, and strong baht. (consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue
Increase of SG&A by 19% y-y was due to a re-classification of expenses from its European businesses. However, SG&A to sales ratio decreased to 4.9% in 3Q17 from 5.1% in 2Q17. Inventory remained high at Bt2.7bn in 3Q17 since the company was not able to deliver fully its backlog orders due to the shortage of the raw materials. The company expected the shortage of raw materials to persist until early 1Q18F. Thus, we believe the gross margin might remain lower than usual. This would continue to pressure the earnings performance despite the sales growth is in a decent level. We maintain our SELL call.
Incom e Statem ent
4Q16
1Q17
2Q17
3Q17
2,813
3,104
2,882
3,101
3,159
266
272
266
269
183
130
156
150
158
155
136
116
116
111
28
213
203
190
186
106
64
42
34
26
56
0
0
0
0
0
Other expense
10
5
3
6
5
(25)
189
153
146
131
79
Interest expense Profit before tax
(40) 104
Gross profit SG&A Operating profit EBITDA Other income Other expense Interest expense Profit before tax Income tax Equity & invest. income Minority interests Extraordinary items Net profit Norm alized profit
(Bt m ) Revenue
9M as
3Q16
Gross profit SG&A Operating profit EBITDA Other income
3
(2)
21
3
6
Income tax
(1)
1
0
0
0
Equity & invest. income
0
0
0
0
0
609 795
52 207
49 174
(2) 125
7 80
q-q% 2
y-y% 12
(32)
(31)
(2)
19
(75)
2017F 12,463
2018F 13,100
65
1,106
1,208
75
615
636
(79)
52
491
572
(43)
(50)
57
848
1,032
111
(13)
158
74
156
na
0
0
56
26
32
(58)
57
622
697
124
72
42
39
(54)
na
Minority interests Extraordinary items
% 2017F 73
na na
(99)
na
0
0
Net profit
(36)
(90)
65
580
659
Norm alized profit
(43)
(61)
56
580
659
(36)
(90)
65
0.26
0.29
(43)
(61)
56
0.26
0.29
3Q17
186
156
125
128
73
0.35
0.09
0.08
0.06
0.04
0.08
0.07
0.06
0.06
0.03
Yr-end Dec (Bt m )
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
3Q16
4Q16
1Q17
2Q17
Cash & equivalent
3,888
3,945
4,095
3,744
3,660
Sales grow th
19.0
52.1
37.0
5.9
12.3
A/C receivable
2,271
2,455
2,334
2,506
2,637
Operating profit grow th
(46.4)
38.8
220.1
7.7
(79.5)
Inventory
2,086
1,943
2,345
2,588
2,765
EBITDA grow th
(30.2)
47.6
89.7
6.4
(50.4)
60
59
42
58
76
Norm profit grow th
(35.4)
62.8
35.0
11.1
(61.0)
Norm EPS grow th
(35.4)
62.8
35.0
11.1
(61.0)
Gross margin
9.5
8.8
9.2
8.7
5.8
Operating margin
4.8
3.7
4.0
3.6
0.9
EBITDA margin
7.6
6.5
6.6
6.0
3.3
Norm net margin
6.6
5.0
4.3
4.1
2.3
EPS (Bt) Normalized EPS (Bt)
(consolidated)
Balance Sheet
Other current assets Investment Fixed assets
3
0
0
0
0
1,962
1,927
1,899
1,916
2,100
Other assets
EPS (Bt) Normalized EPS (Bt) Financial Ratios
444
406
399
408
404
10,715
10,735
11,113
11,221
11,643
118
104
112
52
132
2,516
2,442
2,606
2,877
3,072
Other current liabilities
203
231
270
156
167
L-T debt
736
690
688
735
739
D/E (x)
Other liabilities
188
172
173
181
194
Net D/E (x)
Total assets S-T debt A/C payable
0.1
0.1
0.1
0.1
0.1
(0.4)
(0.4)
(0.5)
(0.4)
(0.4)
0
0
0
0
0
Interest coverage (x)
20
40
60
29
22
Shareholders' equity
6,954
7,098
7,263
7,220
7,339
Interest rate
4.6
2.4
1.6
3.2
2.3
Working capital
Effective tax rate
1.5
(1.0)
14.4
2.4
8.0
ROA ROE
7.2
5.8
4.6
4.6
2.5
11.3
8.9
7.0
7.0
4.0
Minority interest
1,841
1,957
2,072
2,217
2,330
Total debt
854
793
800
787
871
Net debt
(3,034)
(3,152)
(3,295)
(2,956)
(2,790)
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
20
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
WHA Corporation Pcl (WHA TB) - BUY, Price Bt3.78, TP Bt4.00
Results Comment
Rata Limsuthiwanpoom | Email:
[email protected]
Better-than-expected 3Q17
▪
▪ ▪
▪
WHA reported net profit of Bt506m in 3Q17, rising by 1088% yy but falling by 48% q-q. This is higher than we expected on lower-than-expected interest expense and Bt209 income from right of way charged in industrial estate. Going forward, we expect 4Q17 to be the best quarter of the year given its normal asset sales to WHART. 9M17 profit accounted for 63% of our full-year forecast. With 3Q17 result beat our estimation and 4Q17 gain on asset sales likely better than our current forecast, we see potential upside on our earnings forecast this year.
3Q16
4Q16
1Q17
2Q17
3Q17
1,308
13,964
971
2,563
1,250
687
4,623
452
1,315
558
Gross profit SG&A Operating profit EBITDA Other income Other expense Interest expense Profit before tax
▪
(consolidated)
Incom e Statem ent Yr-end Dec (Bt m ) Revenue
▪
286
668
326
468
312
401
3,955
125
847
247
533
4,116
262
970
365
100
180
137
151
336
0
0
0
0
0
628
577
453
419
406
(128)
3,559
(191)
579
177
12
826
(25)
67
39
Income tax
In 3Q17, main drivers for strong growth y-y were 1) falling interest expense in 3Q17 by 35% y-y to Bt406m as a result of asset sales deleveraging in 4Q16 and 2Q17; 2) rising equity income by 156% y-y to Bt563m, driven by the completion of COD of 4 SPPs since 4Q16 and rising availability payment from GHECCO-One; 3) Bt209 income from right of way charged in industrial estate. Meanwhile, main dragger for falling q-q earnings in 3Q17 were falling industrial land transfer revenue, as there was big-lot land transfer last quarter. WHA announced to pay an interim dividend of Bt0.0488/share for the operation period of 9M17. XD and payment date on 22 Nov and 8 Dec 2017.
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
9M as q-q% (51)
y-y% (4) (19)
53
4,353
4,580
9
80
1,389
1,555
(71)
(38)
41
2,964
3,025
(62)
(32)
44
3,650
3,783
122
238
110
569
634
Other expense Interest expense Profit before tax
(3)
(35)
71
1,803
1,524
(69)
na
33
1,730
2,136
Income tax
(42)
214
33
242
299
Equity & invest. income
(19)
156
101
1,502
2,126
na
na
84
(522)
(644)
220
(155)
258
693
563
(38)
(177)
(11)
(233)
(196)
Net profit
0 43
0 2,401
0 81
0 972
0 506
Norm alized profit
43
2,401
81
972
506
0.00
0.17
0.01
0.07
0.04
0.00
0.17
0.01
0.07
0.04
Yr-end Dec (Bt m )
3Q16
4Q16
1Q17
2Q17
3Q17
(%)
3Q16
Cash & equivalent
2,557
2,635
2,699
3,631
1,758
Sales grow th
22.6
470
503
520
464
494
Operating profit grow th
(1.6)
15,413
14,648
14,922
14,262
14,019
EBITDA grow th
9,325
4,272
3,783
4,056
4,275
Norm profit grow th Norm EPS grow th
(consolidated)
Balance Sheet
A/C receivable Inventory Other current assets Investment
2018F 11,182
(58)
Minority interests
EPS (Bt) Normalized EPS (Bt)
2017F 11,256
(33)
Equity & invest. income Extraordinary items
% 2017F 43
Minority interests Extraordinary items Net profit
(48)
1,088
63
2,468
3,319
Norm alized profit
(48)
1,088
63
2,468
3,319
(48)
1,088
63
0.17
0.21
(48)
1,088
63
0.17
0.21
4Q16
1Q17
2Q17
3Q17
62.8
(17.1)
86.1
(4.5)
99.4
(41.0)
147.7
(38.5)
(0.2)
68.8
(28.0)
95.9
na
34.6
(32.6)
190.7
1,088.5
na
34.6
(32.6)
190.7
1,088.5 44.7
EPS (Bt) Normalized EPS (Bt) Financial Ratios
(31.5)
13,859
11,336
10,803
12,931
13,731
Fixed assets
3,851
3,832
3,871
3,925
4,266
Other assets
35,044
37,556
37,031
35,294
35,605
Gross margin
52.5
33.1
46.5
51.3
80,519
74,784
73,628
74,564
74,147
Operating margin
30.6
28.3
12.9
33.0
19.7
18,631
12,161
13,014
7,293
6,496
EBITDA margin
40.7
29.5
27.0
37.8
29.2
A/C payable
2,046
3,022
2,258
2,888
2,776
Norm net margin
3.3
17.2
8.3
37.9
40.5
Other current liabilities
2,248
230
1,224
265
235
32,397
30,004
27,809
30,361
29,843
Total assets S-T debt
L-T debt
D/E (x)
2.6
1.9
1.9
1.4
1.3
1.8
1.7
1.3
1.3
5,365
7,404
7,287
7,172
7,375
Net D/E (x)
2.4
676
533
547
6,189
6,366
Interest coverage (x)
0.8
7.1
0.6
2.3
0.9
Shareholders' equity
19,156
21,429
21,489
20,396
21,057
Interest rate
5.0
4.9
4.4
4.3
4.4
(9.6)
23.2
12.9
11.5
21.8
0.2
12.4
0.4
5.2
2.7
0.9
47.3
1.5
18.6
9.8
Other liabilities Minority interest Working capital
13,837
12,129
13,184
11,838
11,737
Effective tax rate
Total debt
51,028
42,165
40,823
37,654
36,338
Net debt
48,471
39,530
38,124
34,023
34,581
ROA ROE
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
21
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
WHA Utilities & Power (WHAUP TB) - BUY, Price Bt7.60, TP Bt7.00
Results Comment
Supanna Suwankird | Email:
[email protected]
3Q17 superb results and better than expected
▪
▪
▪
▪
Summary: WHAUP‘s net profit beats the market. Both power and water businesses saw improvement especially the power one. Profit contributed from its power investments in GLOW’s group surged as GHECO-1’s resumed operation from maintenance. Its other power associate had had new capacities on stream. Looking forward, 4Q17-2018 should continue strong given the associate has more capacities lining up. BUY.
▪
WHAUP’s 3Q17 net earnings came in at Bt570m. Net-off the forex impact in the consolidation and also in the associates’ profit sharing, its norm earnings would be Bt450m, up 143% yy but down 9% q-q. The results beat the consensus by far.
3Q16
4Q16
1Q17
2Q17
3Q17
371
482
388
405
406
109
194
130
133
130
16
32
25
31
29
Gross profit SG&A Operating profit EBITDA Other income
Its 25% owned in a power associate had increased power generation output: two projects (25MWx2 net-equity owned) which had COD in May and July operated in full quarter while another project (25MW net-equity owned) stated Cod in September.
▪
(consolidated)
Incom e Statem ent
Its 35% owned GLOW had strong operation improvement due mainly to GHECO1 plant resumed operation from maintenance shut down. Its 25% owned Bgrim Power 120MW also reported good performance.
▪
The utilities business which shown under the consolidation account had sales increased 9% y-y driven by a 3% rise in ASP and 6% volume.
Yr-end Dec (Bt m ) Revenue
Share of profit from investment in associates reported at Bt554m. If excluding Bt119m forex gain, the operating profit contribution from the power associates would be Bt434m, a jump of 109% y-y.
93
161
104
103
101
130
192
138
138
136
32
50
46
29
22
Other expense
9M17 norm earnings exceeded our full year estimates as we may under estimate the power associates. We are revisiting our earnings forecast.
Incom e Statem ent (Bt m ) Revenue Gross profit SG&A Operating profit EBITDA Other income
9M as q-q% 0
Income tax Equity & invest. income Minority interests
148
143
146
112
104
(23)
68
4
20
19
(0)
24
(18)
5
3
208
(38)
15
480
434
(0)
(16)
(0)
(0)
Extraordinary items
Interest expense Profit before tax
521
91
94
97
(2)
8
72
427
433
(1)
5
61
675
688
(22)
(30)
100
96
99
na (7)
(30)
58
620
416
(4)
na
(44)
(97)
116
972
1,377
(39)
na
na
(10)
109
96
na
na
(42)
185
(127) (138)
236 273
206 701
120 570
Norm alized profit
185
(11)
37
495
450
0.05
(0.04)
0.07
0.18
0.15
0.05
(0.00)
0.01
0.13
0.12
3Q16
4Q16
1Q17
2Q17
3Q17
Cash & equivalent
147
291
720
336
Sales grow th
A/C receivable
348
321
255
279
Operating profit grow th EBITDA grow th
1,640
1,179
1,185
1,188
Norm profit grow th Norm EPS grow th
na
(consolidated)
Balance Sheet
Inventory Other current assets Investment
8,450
9,308
10,041
10,821
Fixed assets
2,824
2,856
2,914
3,009
Other assets
5,243
4,937
5,214
5,200
Total assets S-T debt A/C payable Other current liabilities L-T debt Other liabilities Minority interest Shareholders' equity Working capital
18,652
18,892
20,329
2,492
4,473
1,974
20,832
276
253
325
271
57
66
39
25
7,930
5,947
5,952
7,925
478
458
462
467
0
0
0
0
7,419
7,696
11,578
12,144
72
68
(70)
8
Total debt
10,421
10,419
7,926
7,925
Net debt
10,274
10,128
7,206
7,590
Net profit Norm alized profit EPS (Bt) Normalized EPS (Bt)
530
75
83
Equity & invest. income Minority interests
2018F 1,584
19
Income tax
Extraordinary items
2017F 1,538
(3)
Net profit EPS (Bt) Normalized EPS (Bt)
% 2017F 78
(6)
Other expense
Interest expense Profit before tax
Yr-end Dec (Bt m )
y-y% 9
23
na 160
350
(19)
208
126
1,225
1,470
(9)
143
112
875
1,470
(19)
208
121
0.33
0.38
(9)
143
107
0.24
0.38
3Q16
4Q16
1Q17
2Q17
3Q17
na
na
86.3
(0.0)
9.4
na
na
149.2
(32.6)
8.3
na
na
126.4
(26.4)
na
na
na
90.2
143.2
na
na
90.2
143.2 32.0
Financial Ratios (%)
4.5
Gross margin
29.4
40.1
33.4
32.9
Operating margin
25.1
33.4
26.8
25.3
24.9
EBITDA margin
35.0
39.8
35.7
33.9
33.4
Norm net margin
49.9
(2.2)
9.4
122.0
110.8
D/E (x)
na
1.4
1.4
0.7
0.7
Net D/E (x)
na
1.4
1.3
0.6
0.6
1
1
1
1
1
Interest rate
na
11.0
5.6
4.9
5.3
Effective tax rate
0.0
36.0
24.4
15.4
ROA ROE
na
(0.2)
0.8
10.1
8.7
na
(0.6)
1.9
20.5
15.2
Interest coverage (x)
(465.2)
So urces: Co mpany data, Thanachart estimates
THANACHART SECURITIES
22
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
NEWS CLIPPING
2-way trade plans take ministry flak : Businesses laud Trump 'America First' policy . Thailand insists
Bangkok Post
on supporting multilateral free trade, despite US President Donald Trump reiterating his America First policy again at the Asia-Pacific Economic Cooperation (Apec) summit in Vietnam, the Foreign Ministry said last Friday.
Tax break campaign begins with additional incentives : A23-day national shopping promotional
The Nation
campaign kicked off yesterday, allowing consumers to get a tax break on purchases worth up to Bt15,000 per individual.
Govt to link data for digital economy : Wissanu says move would save costs and help innovation for
The Nation
businesses . Next year will be the year of data for the public sector amid expectations for the announcement of 300-500 national data sets for people and data analysis for businesses, who could use them for innovative creation in terms of the economy, society and living, the country's deputy premier said.
State enterprise office looking to sell some securities : The State Enterprise Policy Office (Sepo) is
The Nation
expected to sell in the second half of next year some securities held by the Finance Ministry in 24 entities,Sepo director-general Ekniti Nitithanprapas said.
CPN Residence sets sight on reaching Bt10 billion in total revenue by 2022 : Launches of 25 home
The Nation
projects from 2018 to 2022 . CPN Residence Co Ltd, a residential developer under listed company Central Pattana Plc, aims to achieve total revenue of Bt10 billion in 2022 with plans to launch up to 25 new residential projects from 2018-22, the company's managing director, Kree Dejchai, said at a press conference last Friday.
THANACHART SECURITIES
23
THAILAND’s TOP LOCAL KNOWLEDGE
Market data
Monday, November 13, 2017
Close
∆
%∆
SET Index
1,689.3
-13.8
-0.8%
SET50 Index
1,073.0
-8.5
-0.8%
IVL
PT TEP
SCC
PT TGC
PT TEP
SCB
ESSO
IVL
SET100 Index
PRICE CHANGE - MOST ACTIVE Change 1 Day (%)
Change 1 Week (%)
2,417.4
-20.8
-0.9%
557.8
-8.1
-1.4%
Economic data
Current
-1M
-3M
ADVANC
AOT
Saving Rate (%)
0.50
0.50
0.50
RSP
SCC
Fixed Deposit - 3M (%)
1.00
1.00
1.00
AOT
BANPU
PT T
PT T
BANPU
ADVANC
MAI Index
Fixed Deposit - 1Y (%)
1.50
1.50
1.50
Govt Bond Yield 1Y (%)
1.40
1.42
1.38
Govt Bond Yield 10Y (%)
2.46
2.38
2.48
Treasury Yield – 10Y (%)
2.34
2.35
2.19
Policy Rate (%)
1.50
1.50
1.50
10.50
9.85
VIX Index TED Spread (%)
0.19
0.27
Source: Bloomberg, Datastream, Thai BMA
SET Forward PE Band (index) 25x
3,000 2,500 2,000
MINT
PT TGC (2)
(1)
0
1
(8)
2
Change 1Month (%)
15.51
AOT
0.28
PT TEP
PT TGC
KBANK
ADVANC
TOA
KBANK
SCB
PT T
AOT
CPALL
PT T
SCB
PT TGC
PT TEP
21x
SCC
SCC
17x
ADVANC
BANPU
(5)
0
(4)
(2)
0
2
4
Change Year-To-Date (%)
IVL
(10)
(6)
5
10
15
(20)
0
20
40
60
13x
1,500
9x
1,000
6x
2016
2014
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
0
2018F
500
SET PE Discount to MSCI Asia x JP (x) 10 8
+2 STD = 6.1x
6
+1 STD = 3.4x
4 2
-1 STD = -2.2x
(4)
-2 STD = -5x
(6) Jul-06
Source: Bloomberg
Jan-10
Change 1 Week (%)
HELTH
PETRO
CONMAT
ENERG
PETRO
MEDIA
BANK
BANK
ICT
COMM
TRANS
SET
ETRON
HELTH
AUTO
AUTO
SET
TRANS
ENERG
PROP
FOOD
ICT
PROP
FOOD
COMM
CONMAT
(2.0)
(2)
(8) Jan-03
Change 1 Day (%)
ETRON
MEDIA
Average = 0.6x
0
SECTOR CHANGE
Jul-13
Jan-17
(1.0)
0.0
1.0
Change 1 Month (%)
(4.0)
0.0
2. 0
Change Year-To-Date (%) PETRO
MEDIA AUTO
AUTO
PROP
TRANS
PETRO
MEDIA
COMM
PROP
FOOD
ENERG
HELTH
COMM
BANK
SET
ENERG
BANK
TRANS
ICT
SET
FOOD
CONMAT
HELTH
ETRON
CONMAT ETRON
ICT (10.0)
(2.0)
(5.0)
0.0
5.0
(20.0)
0. 0
20.0
40.0
Source: Bloomberg
THANACHART SECURITIES
24
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
REGIONAL MARKET PERFORMANCE
REGIONAL FUND FLOWS
Change 1 Day (%)
Change 1 Day (-1D)
Change 1 Week (%)
(US$ m) India
Hang Seng
China
China
Nasdaq
Singapore
Hang Seng
Philippines
S&P500
Nikkei
Taiwan
MSCI Asia x JP
Singapore
(4) (58)
Nasdaq
MSCI Asia x JP
S&P500
Malaysia
S.Korea
S.Korea
Indonesia
Taiwan
Nikkei
Thailand
Philippines
India
Change 1 Month (%)
Taiwan
Thailan d Indone sia
Kor ea
Asia-6
(US$ m)
Thailand
0. 5
Phil ip.
Change 1 Week (-1W) 1,200 1,000 800 600 400 200 0 (200 ) (400 ) (600 )
Dow Jones
(1.5) (1.0) (0.5) 0.0
(89)
(403) India
Dow Jones
(82)
(169)
Malaysia
Indonesia
0
0 (50) (100 ) (150 ) (200 ) (250 ) (300 ) (350 ) (400 ) (450 )
(2.0) (1.0) 0. 0
1.0
2. 0
Change Year-To-Date (%)
1,036 592 170
(1)
(119)
(141) (354)
India
Asia-6
Kor ea
Phil ip.
Thailan d Indone sia Taiwan
Change 1 Month (-1M) (US$ m)
Nikkei
MSCI Asia x JP
Singapore
Hang Seng
S. Korea
S.Korea
India
3,500 3,000 2,500 2,000 1,500 1,000 500 0 (500 ) (1,000)
Nasdaq
Dow Jones
India
Hang Seng
Philippines
Nasdaq
Singapore
MSCI Asia x JP
Nikkei
Indonesia
Dow Jones
S&P500
S&P500
20,000
Taiwan
Indonesia
15,000
Philippines
China
Malaysia
Thailand
4
6
Source: Bloomberg
THANACHART SECURITIES
8
76
India
Kor ea
Taiwan
Phil ip.
(686) (666) Indone sia Thailan d
20,868
10,000
7,307
7,301
7,239
5,000
1,094
0
Malaysia
2
553
(US$ m) 25,000
0
1,489
Change Year-To-Date (YTD)
Taiwan
(2)
2,192
Asia-6
China
Thailand
2,958
0
10
20
30
40
(5,000) Asia-6
India
Kor ea
Taiwan
Phil ip.
(210) (1,863) Thailan d Indone sia
Source: Bloomberg
25
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
General Disclaimers And Disclosures: This report is prepared and issued by Thanachart Securities Public Company Limited (TNS) as a resource only for clients of TNS, Thanachart Capital Public Company Limited (TCAP) and its group companies. Copyright © Thanachart Securities Public Company Limited. All rights reserved. The report may not be reproduced in whole or in part or delivered to other persons without our written consent.
This report is prepared by analysts who are employed by the research department of TNS. While the information is from sources believed to be reliable, neither the information nor the forecasts shall be taken as a representation or warranty for which TNS or TCAP or its group companies or any of their employees incur any responsibility. This report is provided to you for informational purposes only and it is not, and is not to be construed as, an offer or an invitation to make an offer to sell or buy any securities. Neither TNS, TCAP nor its group companies accept any liability whatsoever for any direct or consequential loss arising from any use of this report or its contents.
The information and opinions contained herein have been compiled or arrived at from sources believed reliable. However, TNS, TCAP and its group companies make no representation or warranty, express or implied, as to their accuracy or completeness. Expressions of opinion herein are subject to change without notice. The use of any information, forecasts and opinions contained in this report shall be at the sole discretion and risk of the user. TNS, TCAP and its group companies perform and seek to perform business with companies covered in this report. TNS, TCAP, its group companies, their employees and directors may have positions and financial interest in securities mentioned in this report. TNS, TCAP or its group companies may from time to time perform investment banking or other services for, or solicit investment banking or other business from, any entity mentioned in this report. Therefore, investors should be aware of conflict of interest that may affect the objectivity of this report.
THANACHART SECURITIES
26
THAILAND’s TOP LOCAL KNOWLEDGE
Monday, November 13, 2017
Recommendation Structure: Recommendations are based on absolute upside or downside, which is the difference between the target price and the current market price. If the upside is 10% or more, the recommendation is BUY. If the downside is 10% or more, the recommendation is SELL. For stocks where the upside or downside is less than 10%, the recommendation is HOLD. Unless otherwise specified, these recommendations are set with a 12-month horizon. Thus, it is possible that future price volatility may cause a temporary mismatch between upside/downside for a stock based on the market price and the formal recommendation. For sectors, we look at two areas, ie, the sector outlook and the sector weighting. For the sector outlook, an arrow pointing up, or the word “Positive”, is used when we see the industry trend improving. An arrow pointing down, or the word “Negative”, is used when we see the industry trend deteriorating. A double-tipped horizontal arrow, or the word “Unchanged”, is used when the industry trend does not look as if it will alter. The industry trend view is our top-down perspective on the industry rather than a bottom-up interpretation from the stocks we cover. An “Overweight” sector weighting is used when we have BUYs on majority of the stocks under our coverage by market cap. “Underweight” is used when we have SELLs on majority of the stocks we cover by market cap. “Neutral” is used when there are relatively equal weightings of BUYs and SELLs.
Thanachart Securities Pcl. Research Team 19 Floor, MBK Tower 444 Phayathai Road, Pathumwan Road, Bangkok 10330 Tel: 662 - 617 4900 Email:
[email protected] Pimpaka Nichgaroon, CFA Head of Research
Adisak Phupiphathirungul, CFA Retail Market Strategy
Chak Reungsinpinya Energy, Petrochemical
[email protected]
[email protected]
[email protected]
Kalvalee Thongsomaung Food, Hotel, Media
Phannarai Tiyapittayarut Property, Retail
[email protected]
Pattarawan Wangmingmat Senior Technical Analyst
[email protected]
Rata Limsuthiwanpoom Industrial Estate, Property Fund, REITs
Saksid Phadthananarak Construction, Transportation
Sarachada Sornsong Bank, Financial, Telecom
[email protected]
[email protected]
[email protected]
Siriporn Arunothai Small Cap Research, Healthcare
Supanna Suwankird Energy, Utilities
Wichaya Wongpanuwich, CFA, FRM Analyst, Retail Market
[email protected]
[email protected]
[email protected]
Witchanan Tambamroong Technical Analyst
[email protected]
Nuttapop Prasitsuksant Assistant Analyst
[email protected]
Pattadol Bunnak Assistant Analyst
[email protected]
Sittichet Rungrassameephat Assistant Analyst, Quantitative
Thaloengsak Kucharoenpaisan Assistant Analyst
[email protected]
[email protected]
THANACHART SECURITIES
[email protected]
27
