1Q17E earnings to be pressured by higher tuna and shrimp costs
Thai Union Group Underperform (17E TP Bt21.20)
Company Update
Close Bt21.00 Food & Beverage
Earning upgrade/Earnings downgrade/Overview unchanged
April 7, 2017
1Q17E earnings to be pressured by higher tuna and shrimp costs ... Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
1.354
1.531
KT ZMICO vs. consensus Share data
‐8.4%
‐8.6%
Reuters / Bloomberg
TU.BK/TU TB
Paid‐up Shares (m)
4,771.82
Par (Bt)
0.25
Market cap (Bt bn / US$ m)
100.00/2,897.00
Foreign limit / actual (%)
45.00/33.37
52 week High / Low (Bt)
23.00/19.50
Avg. daily T/O (shares 000)
12,680.00
NVDR (%)
10.42
Estimated free float (%)
64.79
Beta
0.45
URL
www.thaiuniongroup.com
CGR
Anti‐corruption
Level 2 (Declared)
Phornsri Laysanitsaerekul Analyst , no 17621 [email protected] 66 (0) 2624‐6258
1Q17 core profit to weaken, causing share price to underperform As the prices of tuna and shrimp (raw material) are expected to increase, this will pressure the gross profit margin in 1Q17. We thus expect 1Q17 core profit to fall by 15%YoY and 37%QoQ. The current share price is already fully valued at Bt21.20/share (16x PER). Therefore, we maintain an “Underperform” rating. 1Q17E core profit to weaken by 15%YoY and 37%QoQ, pressured by higher tuna and shrimp costs We expect TU to report 1Q17E core profit of Bt890mn (‐15%YoY, ‐ 37%QoQ). Highlights for the 1Q17E earnings performance include the following. First, sales are estimated at Bt31.8bn, up 2%YoY but down by 5%QoQ (while sales of tuna in Thailand and the US may have improved, those in Europe may have fallen YoY). Second, the gross profit margin is estimated at 13.7%, down from 15.5% in 1Q16 and 14.3% in 4Q16 because the tuna and shrimp businesses (accounting for 60% of TU’s total sales) may have been pressured by higher raw material costs. Meanwhile, the salmon business is expected to continue yielding a good gross profit margin QoQ. Third, the operating expenses are estimated at 10.5% of sales. Fourth, net other income and interest expense are expected to have increased from Red Lobster. Finally, the earnings contribution from affiliates is expected to increase. Moreover, the baht has strengthened in 1Q17; hence, the firm is expected to have seen FX gain of Bt350mn. All in all, TU is expected to deliver 1Q17E net profit of Bt1.24bn. Core profit is expected to recover in 2H17 The salmon business has continued to see a good gross profit margin and the raw material costs (i.e., tuna and shrimp) are expected to fall (tuna price fell in Mar‐17 to US$1,500/ton vs. US$1,700/ton during January to February) in 2017E. Other positive points are that the firm’s output is expected to increase and that it has succeeded in raising selling prices with its clients to reflect actual raw material costs in 1Q17, the result of which will be clearly seen in 2Q17. Therefore, we expect core profit to recover in 2H17. 2017E core profit forecast maintained While 1Q17E core profit accounts for 15% of our 2017E forecast, we have maintained our current projection; we believe it should be achievable given the likelihood that core earnings will recover in the remaining quarters of the year. Financial and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) Norm. EPS (Bt) Norm. EPS growth (%) Dividend (Bt) BV (Bt) FY Ended 31 Dec PER (x) EV/EBITDA (x) PBV (x) Dividend yield (%) ROE (%) Net gearing (%)
2014 121,402 5,092 1.08 1.01 111% 0.55 9.15 2014 19.37 13.70 2.29 2.62% 12.2% 101.5
2015 124,904 5,373 1.13 1.09 8% 0.63 9.49 2015 18.65 12.41 2.21 3.00% 12.1% 83.5
2016 134,375 5,254 1.10 1.13 3% 0.63 9.06 2016 19.07 15.12 2.32 3.00% 11.9% 153.8
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 3
2017E 148,937 5,935 1.24 1.24 10% 0.62 10.43 2017E 16.88 14.62 2.01 2.96% 12.8% 129.5
2018E 163,658 6,751 1.41 1.41 14% 0.71 11.22 2018E 14.84 13.63 1.87 3.37% 13.1% 123.5
Figure 1: Earnings Preview (Bt m) Sales COGS Gross profit SG&A expense EBIT Interest expense EBT Tax expense Equity income MI Norm. profit Extra. Items Net profit
1Q16 31,257 ‐26,409 4,848 ‐3,359 1,768 ‐329 1,439 ‐309 56 142 1,044 186 1,231
EPS (Bt) Gross margin SG&A /Sales EBIT margin Norm. profit margin
4Q16 1Q17E 33,550 31,820 ‐28,766 ‐27,457 4,783 4,362 ‐3,290 ‐3,341 1,952 1,489 ‐488 ‐500 1,464 989 121 ‐79 ‐51 130 126 150 1,409 890 ‐506 350 902 1,240
0.26
0.19
0.26
15.5% 10.7% 5.7% 3.3%
14.3% 9.8% 5.8% 4.2%
13.7% 10.5% 4.7% 2.8%
% YoY %QoQ 1.8% ‐5.2% 4.0% ‐4.6% ‐10.0% ‐8.8% ‐0.5% 1.6% ‐15.8% ‐23.7% 52.1% 2.5% ‐31.3% ‐32.5% ‐74.4% ‐165.4% 130.3% ‐357.0% 5.4% 19.0% ‐14.8% ‐36.8% nm nm 0.8% 37.4% ‐0.1%
2016 134,375 ‐114,378 19,997 ‐13,081 8,042 ‐1,440 6,602 ‐811 194 606 5,380 ‐126 5,254
39.0%
2017E % YoY YTD (% of 2017E) 148,937 10.8% 21.4% ‐126,413 10.5% 21.7% 22,524 12.6% 19.4% ‐14,962 14.4% 22.3% 9,424 17.2% 15.8% ‐2,215 53.8% 22.6% 7,209 9.2% 13.7% ‐1,081 33.3% 7.3% 425 118.8% 30.6% 618 2.0% 24.3% 5,935 10.3% 15.0% 0 nm nm 5,935 13.0% 20.9%
1.10
1.24
14.9% 9.7% 6.0% 4.0%
15.1% 10.0% 6.3% 4.0%
13.0%
20.9%
Source : TU, KTZ Research Figure 2: WPO Skipjack tuna prices (US$ per ton) Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Avg
2004 870 780 680 750 920 950 1,040 1,150 1,170 800 780 700 883
2005 730 800 985 990 925 900 970 995 880 820 750 710 871
2006 780 1,040 880 840 925 960 840 930 945 885 880 1,020 910
2009 1,025 1,220 1,140 940 1,190 1,450 1,450 1,380 1,150 865 850 1,030 1,141
2010 1,075 960 1,085 1,365 1,530 1,705 1,560 1,326 1,215 1,080 1,232 1,305 1,287
2011 1,515 1,590 1,475 1,680 1,840 1,905 1,620 1,845 1,975 1,830 1,910 2,005 1,766
2012 2,030 1,930 2,090 2,195 2,198 2,200 2,240 2,280 2,350 2,210 1,900 1,900 2,127
2013 2,075 2,195 2,325 2,320 2,195 2,020 1,850 1,880 1,875 1,770 1,570 1,400 1,956
2014 1,275 1,225 1,175 1,225 1,485 1,710 1,800 1,600 1,280 1,200 1,180 1,180 1,361
2015 1,150 1,150 1,010 1,035 1,070 1,200 1,400 1,500 1,390 1,140 1,000 1,000 1,170
2016 1,000 1,170 1,600 1,610 1,500 1,400 1,400 1,450 1,450 1,400 1,500 1,625 1,425
2017 1,700 1,700 1,500
2,350 2,200
1,500
2008 1,560 1,460 1,520 1,650 1,800 1,945 1,930 1,840 1,800 1,500 1,170 850 1,585
2,000
2,500
2,000
2007 1,030 970 990 1,070 1,230 1,300 1,420 1,550 1,390 1,475 1,410 1,500 1,278
1,915 1,813
1,975
1,800
2,195
1,900
1,600
1,880 1,633 1,503 1,508 1,433
1,570
1,475
1,430
1,257 1,103 1,102 1,047
1,400 1,200 1,000 800
1,000 600 400
500
200
3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17
Oct‐13 Dec‐13 Feb‐14 Apr‐14 Jun‐14 Aug‐14 Oct‐14 Dec‐14 Feb‐15 Apr‐15 Jun‐15 Aug‐15 Oct‐15 Dec‐15 Feb‐16 Apr‐16 Jun‐16 Aug‐16 Oct‐16 Dec‐16 Feb‐17
‐
0
Source: TU , KTZ Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 3
1,633
Note: KT ZMICO has two major shareholders, Krungthai Bank PLC (KTB) and Seamico Securities PLC (ZMICO). Therefore, prior to making investments in the securities of KTB and ZMICO, investors should consider the risk factors carefully. An executive of KT ZMICO Securities is also a board member of BCP, BTC, CI, CPI, KBS, MAJOR, MK, PACE, PSL, SVH, VNG, ZMICO, SAWAD, TFG. A management member of KT ZMICO Securities is also a board member of BTC and NFC. KT ZMICO is a financial advisor for U, LOXLEY, ZMICO, MAKRO, CPALL, SAFARI, M‐CHAI, POMPUI, TFD, CI.
Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD) Excellent (scores: 90 ‐ 100) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
Anti‐corruption Progress Indicator Source: Sec, Thailand's Private Sector Collective Action Coalition Against Corruption programme (Thai CAC)
Level 1 (Committed) : Organization’s statement or board's resolution to work against corruption and to be in compliance with all relevant laws. Level 2 (Declared) : Public declaration statement to participate in Thailand's private sector Collective Action Coalition Against Corruption (CAC) or equivalent initiatives Level 3 (Established) : Public out preventive measures, risk assessment, communication and training for all employees, including consistent monitoring and review processes Level 4 (Certified) : Audit engagement by audit committee or auditors approved by the office of SEC, and receiving certification or assurance by independent external assurance providers (CAC etc.) Level 5 (Extended) : Extension of the anti‐corruption policy to business partners in the supply chain, and disclosure of any current investigations, prosecutions or closed cases Insufficient or not clearly defined policy Data not available / no policy
DISCLAIMER This document is produced using open sources believed to be reliable. However, their accuracy and completeness cannot be guaranteed. The statements and opinions herein were formed after due and careful consideration for use as information for the purposes of investment. The opinions contained herein are subject to change without notice. This document is not, and should not be construed as, an offer or the solicitation of an offer to buy or sell any securities. The use of any information contained in this document shall be at the sole discretion and risk of the user.
KT ZMICO RESEARCH – RECOMMENDATION DEFINITIONS STOCK RECOMMENDATIONS
SECTOR RECOMMENDATIONS
BUY: Expecting positive total returns of 15% or more OVERWEIGHT: The industry, as defined by the analyst's over the next 12 months coverage universe, is expected to outperform the relevant OUTPERFORM: Expecting total returns between ‐10% primary market index by at least 10% over the next 12 months. to +15%; returns expected to exceed market returns NEUTRAL: The industry, as defined by the analyst's coverage over a six‐month period due to specific catalysts universe, is expected to perform in line with the relevant UNDERPERFORM: Expecting total returns between primary market index over the next 12 months. ‐10% to +15%; returns expected to be below market UNDERWEIGHT: The industry, as defined by the analyst's returns over a six‐month period due to specific coverage universe, is expected to underperform the relevant catalysts primary market index by 10% over the next 12 months. SELL: Expecting negative total returns of 10% or more over the next 12 months
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 3
KT ZMICO Securities Company Limited Head Office
WWW.KTZMICO.COM
8th, 15th‐17th,19th, 21st Floor, Liberty Square Bldg., 287 Silom Road, Bangrak, Bangkok, Thailand 10500 Telephone: (66‐2) 695‐5000 Fax: (66‐2) 695‐5173 KT ZMICO Connect 662 695 5555
Central World Branch
Amarin Branch
22nd Floor, Amarin Building, 496‐502 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 018‐6200 Fax: (66‐2) 018‐6298, (66‐2) 018‐6299
8th Floor, Ton Son Tower, 900 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 626‐6000 Fax: (66‐2) 626‐6111
Phaholyothin Branch
Sindhorn Branch
Viphavadee Branch
2nd Floor, Sindhorn Tower 1, 130‐132 Wireless Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 627‐3550 Fax: (66‐2) 627‐3582, 627‐3600
G Floor, Lao Peng Nguan 1 Bldg., 333 Soi Cheypuand, Viphavadee‐Rangsit Road, Ladyao, Jatujak, Bangkok 10900 Telephone: (66‐2) 013‐8600 Fax: (66‐2) 618‐8569
BangKhae Branch
Chiang Mai Branch
Pak Chong Branch
999/9 The Offices at Central World, 16th Fl., Rama 1 Rd, Pathumwan, Bangkok 10330 Telephone: (66‐2) 264‐5888 Fax: (66‐2) 264 5899
1291/1, Shinnawatra Tower II, 3rd Floor, Phaholyothin Road, Phayathai, Bangkok 10400 Telephone: (66‐2) 686‐1500 Fax: (66‐2) 686‐1666
Ploenchit Branch
518 The Mall Group Building Bangkhae Branch, 6th Floor, Petchkasem Road, North Bangkhae, Bangkhae, Bangkok 10160 Telephone: (66‐2) 454‐9979 Fax: (66‐2) 454‐9970
422/49 Changklan Road, Changklan Subdistrict, Amphoe Meuang, Chiang Mai 50100 Telephone: (053) 270‐072 Fax: (053) 272‐618
173 175, Mittapap Road, Nong Sarai, Pak Chong, Nakhon Ratchasima 30130 Telephone: (044) 279‐511 Fax: (044) 279‐574
Korat Branch
Khon Kaen Branch
Chonburi Branch
624/9 Changphuek Road, T.Naimaung, A.Maung, Nakhon Ratchasima 30000 Telephone: (044) 247222 Fax: (044) 247171
5th Floor, Charoen Thani Princess Hotel, 260 Srichan Road, T. Naimuang, A. Muang, Khon Kaen 40000 Telephone: (043) 389‐171‐193 Fax: (043) 389‐209
4th Floor, Forum Plaza Bldg., 870/52 Sukhumvit Road, T. Bangplasoy, A. Muang, Cholburi 20000 Telephone: (038) 287‐635 Fax: (038) 287‐637
Pattaya Branch
Chachoengsao Branch
Hat Yai Branch
Easy Point 2, 392/65 Moo.9, T.Nong Prue, A. Bang Lamung, Chonburi 20260 Telephone: (038) 420‐965 Fax: (038) 420‐968
108/34‐36 Mahajakkrapad Road, T.Namuang, A.Muang, Chachoengsao 24000 Telephone: (038) 813‐088 Fax: (038) 813‐099
200/301, 200/303 JULDIS HATYAI PLAZA Floor 3 , Niphat‐Uthit 3 Rd, Hatyai Songkhla 90110 Telephone: (074) 355530‐3 Fax: (074) 355534
Phuket Branch
22/61‐63, Luang Por Wat Chalong Road, Talat Yai, Mueang Phuket, Phuket 83000 Telephone: (076) 222‐811, (076) 222‐683 Fax: (076) 222‐861
Phitsanulok Branch
227/171 Borom Trilokkanat Road, Muang, Phitsanulok 65000 Telephone: 055‐219‐255 to 8 Fax: 055‐219‐259
Nakhon Pathom
Cyber Branch Ayutthaya
Cyber Branch @ North Nana
Cyber Branch Chiangrai
KrungThai Bank, Rojana Branch 253 Moo 5, Rojana Road, Phai Ling, Phra Nakhon Si Ayutthaya, Phra Nakhonsi Ayutthaya, 13000 Telephone: 035‐242‐477 Fax: 035‐242‐476
Krung Thai Bank PCL, 2 Floor, North Nana Branch 35 Sukhumvit Rd., Klong Toey Nua Subdistrict , Wattana District , Bangkok 10110 Telephone: 083‐490‐2871
River Hotel (Building 3rd),1156 Petchakasem Road, Sanamchan Subdistrict, Amphoe Meuang , Nakhon Pathom Province 73000 Telephone: (034) 271300 Fax: (034) 271300 #100
KrungThai Bank, Hayaek Phokhun Mengrai Branch 116/19 Moo 19, Highway 110 Road, Rop Wiang, Mueang Chiang Rai, Chiang Rai, 57000 Telephone: 053‐715‐067 Fax: 053‐715‐068
Company Update
Close Bt21.00 Food & Beverage
Earning upgrade/Earnings downgrade/Overview unchanged
April 7, 2017
1Q17E earnings to be pressured by higher tuna and shrimp costs ... Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
1.354
1.531
KT ZMICO vs. consensus Share data
‐8.4%
‐8.6%
Reuters / Bloomberg
TU.BK/TU TB
Paid‐up Shares (m)
4,771.82
Par (Bt)
0.25
Market cap (Bt bn / US$ m)
100.00/2,897.00
Foreign limit / actual (%)
45.00/33.37
52 week High / Low (Bt)
23.00/19.50
Avg. daily T/O (shares 000)
12,680.00
NVDR (%)
10.42
Estimated free float (%)
64.79
Beta
0.45
URL
www.thaiuniongroup.com
CGR
Anti‐corruption
Level 2 (Declared)
Phornsri Laysanitsaerekul Analyst , no 17621 [email protected] 66 (0) 2624‐6258
1Q17 core profit to weaken, causing share price to underperform As the prices of tuna and shrimp (raw material) are expected to increase, this will pressure the gross profit margin in 1Q17. We thus expect 1Q17 core profit to fall by 15%YoY and 37%QoQ. The current share price is already fully valued at Bt21.20/share (16x PER). Therefore, we maintain an “Underperform” rating. 1Q17E core profit to weaken by 15%YoY and 37%QoQ, pressured by higher tuna and shrimp costs We expect TU to report 1Q17E core profit of Bt890mn (‐15%YoY, ‐ 37%QoQ). Highlights for the 1Q17E earnings performance include the following. First, sales are estimated at Bt31.8bn, up 2%YoY but down by 5%QoQ (while sales of tuna in Thailand and the US may have improved, those in Europe may have fallen YoY). Second, the gross profit margin is estimated at 13.7%, down from 15.5% in 1Q16 and 14.3% in 4Q16 because the tuna and shrimp businesses (accounting for 60% of TU’s total sales) may have been pressured by higher raw material costs. Meanwhile, the salmon business is expected to continue yielding a good gross profit margin QoQ. Third, the operating expenses are estimated at 10.5% of sales. Fourth, net other income and interest expense are expected to have increased from Red Lobster. Finally, the earnings contribution from affiliates is expected to increase. Moreover, the baht has strengthened in 1Q17; hence, the firm is expected to have seen FX gain of Bt350mn. All in all, TU is expected to deliver 1Q17E net profit of Bt1.24bn. Core profit is expected to recover in 2H17 The salmon business has continued to see a good gross profit margin and the raw material costs (i.e., tuna and shrimp) are expected to fall (tuna price fell in Mar‐17 to US$1,500/ton vs. US$1,700/ton during January to February) in 2017E. Other positive points are that the firm’s output is expected to increase and that it has succeeded in raising selling prices with its clients to reflect actual raw material costs in 1Q17, the result of which will be clearly seen in 2Q17. Therefore, we expect core profit to recover in 2H17. 2017E core profit forecast maintained While 1Q17E core profit accounts for 15% of our 2017E forecast, we have maintained our current projection; we believe it should be achievable given the likelihood that core earnings will recover in the remaining quarters of the year. Financial and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) Norm. EPS (Bt) Norm. EPS growth (%) Dividend (Bt) BV (Bt) FY Ended 31 Dec PER (x) EV/EBITDA (x) PBV (x) Dividend yield (%) ROE (%) Net gearing (%)
2014 121,402 5,092 1.08 1.01 111% 0.55 9.15 2014 19.37 13.70 2.29 2.62% 12.2% 101.5
2015 124,904 5,373 1.13 1.09 8% 0.63 9.49 2015 18.65 12.41 2.21 3.00% 12.1% 83.5
2016 134,375 5,254 1.10 1.13 3% 0.63 9.06 2016 19.07 15.12 2.32 3.00% 11.9% 153.8
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 3
2017E 148,937 5,935 1.24 1.24 10% 0.62 10.43 2017E 16.88 14.62 2.01 2.96% 12.8% 129.5
2018E 163,658 6,751 1.41 1.41 14% 0.71 11.22 2018E 14.84 13.63 1.87 3.37% 13.1% 123.5
Figure 1: Earnings Preview (Bt m) Sales COGS Gross profit SG&A expense EBIT Interest expense EBT Tax expense Equity income MI Norm. profit Extra. Items Net profit
1Q16 31,257 ‐26,409 4,848 ‐3,359 1,768 ‐329 1,439 ‐309 56 142 1,044 186 1,231
EPS (Bt) Gross margin SG&A /Sales EBIT margin Norm. profit margin
4Q16 1Q17E 33,550 31,820 ‐28,766 ‐27,457 4,783 4,362 ‐3,290 ‐3,341 1,952 1,489 ‐488 ‐500 1,464 989 121 ‐79 ‐51 130 126 150 1,409 890 ‐506 350 902 1,240
0.26
0.19
0.26
15.5% 10.7% 5.7% 3.3%
14.3% 9.8% 5.8% 4.2%
13.7% 10.5% 4.7% 2.8%
% YoY %QoQ 1.8% ‐5.2% 4.0% ‐4.6% ‐10.0% ‐8.8% ‐0.5% 1.6% ‐15.8% ‐23.7% 52.1% 2.5% ‐31.3% ‐32.5% ‐74.4% ‐165.4% 130.3% ‐357.0% 5.4% 19.0% ‐14.8% ‐36.8% nm nm 0.8% 37.4% ‐0.1%
2016 134,375 ‐114,378 19,997 ‐13,081 8,042 ‐1,440 6,602 ‐811 194 606 5,380 ‐126 5,254
39.0%
2017E % YoY YTD (% of 2017E) 148,937 10.8% 21.4% ‐126,413 10.5% 21.7% 22,524 12.6% 19.4% ‐14,962 14.4% 22.3% 9,424 17.2% 15.8% ‐2,215 53.8% 22.6% 7,209 9.2% 13.7% ‐1,081 33.3% 7.3% 425 118.8% 30.6% 618 2.0% 24.3% 5,935 10.3% 15.0% 0 nm nm 5,935 13.0% 20.9%
1.10
1.24
14.9% 9.7% 6.0% 4.0%
15.1% 10.0% 6.3% 4.0%
13.0%
20.9%
Source : TU, KTZ Research Figure 2: WPO Skipjack tuna prices (US$ per ton) Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Avg
2004 870 780 680 750 920 950 1,040 1,150 1,170 800 780 700 883
2005 730 800 985 990 925 900 970 995 880 820 750 710 871
2006 780 1,040 880 840 925 960 840 930 945 885 880 1,020 910
2009 1,025 1,220 1,140 940 1,190 1,450 1,450 1,380 1,150 865 850 1,030 1,141
2010 1,075 960 1,085 1,365 1,530 1,705 1,560 1,326 1,215 1,080 1,232 1,305 1,287
2011 1,515 1,590 1,475 1,680 1,840 1,905 1,620 1,845 1,975 1,830 1,910 2,005 1,766
2012 2,030 1,930 2,090 2,195 2,198 2,200 2,240 2,280 2,350 2,210 1,900 1,900 2,127
2013 2,075 2,195 2,325 2,320 2,195 2,020 1,850 1,880 1,875 1,770 1,570 1,400 1,956
2014 1,275 1,225 1,175 1,225 1,485 1,710 1,800 1,600 1,280 1,200 1,180 1,180 1,361
2015 1,150 1,150 1,010 1,035 1,070 1,200 1,400 1,500 1,390 1,140 1,000 1,000 1,170
2016 1,000 1,170 1,600 1,610 1,500 1,400 1,400 1,450 1,450 1,400 1,500 1,625 1,425
2017 1,700 1,700 1,500
2,350 2,200
1,500
2008 1,560 1,460 1,520 1,650 1,800 1,945 1,930 1,840 1,800 1,500 1,170 850 1,585
2,000
2,500
2,000
2007 1,030 970 990 1,070 1,230 1,300 1,420 1,550 1,390 1,475 1,410 1,500 1,278
1,915 1,813
1,975
1,800
2,195
1,900
1,600
1,880 1,633 1,503 1,508 1,433
1,570
1,475
1,430
1,257 1,103 1,102 1,047
1,400 1,200 1,000 800
1,000 600 400
500
200
3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17
Oct‐13 Dec‐13 Feb‐14 Apr‐14 Jun‐14 Aug‐14 Oct‐14 Dec‐14 Feb‐15 Apr‐15 Jun‐15 Aug‐15 Oct‐15 Dec‐15 Feb‐16 Apr‐16 Jun‐16 Aug‐16 Oct‐16 Dec‐16 Feb‐17
‐
0
Source: TU , KTZ Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 3
1,633
Note: KT ZMICO has two major shareholders, Krungthai Bank PLC (KTB) and Seamico Securities PLC (ZMICO). Therefore, prior to making investments in the securities of KTB and ZMICO, investors should consider the risk factors carefully. An executive of KT ZMICO Securities is also a board member of BCP, BTC, CI, CPI, KBS, MAJOR, MK, PACE, PSL, SVH, VNG, ZMICO, SAWAD, TFG. A management member of KT ZMICO Securities is also a board member of BTC and NFC. KT ZMICO is a financial advisor for U, LOXLEY, ZMICO, MAKRO, CPALL, SAFARI, M‐CHAI, POMPUI, TFD, CI.
Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD) Excellent (scores: 90 ‐ 100) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
Anti‐corruption Progress Indicator Source: Sec, Thailand's Private Sector Collective Action Coalition Against Corruption programme (Thai CAC)
Level 1 (Committed) : Organization’s statement or board's resolution to work against corruption and to be in compliance with all relevant laws. Level 2 (Declared) : Public declaration statement to participate in Thailand's private sector Collective Action Coalition Against Corruption (CAC) or equivalent initiatives Level 3 (Established) : Public out preventive measures, risk assessment, communication and training for all employees, including consistent monitoring and review processes Level 4 (Certified) : Audit engagement by audit committee or auditors approved by the office of SEC, and receiving certification or assurance by independent external assurance providers (CAC etc.) Level 5 (Extended) : Extension of the anti‐corruption policy to business partners in the supply chain, and disclosure of any current investigations, prosecutions or closed cases Insufficient or not clearly defined policy Data not available / no policy
DISCLAIMER This document is produced using open sources believed to be reliable. However, their accuracy and completeness cannot be guaranteed. The statements and opinions herein were formed after due and careful consideration for use as information for the purposes of investment. The opinions contained herein are subject to change without notice. This document is not, and should not be construed as, an offer or the solicitation of an offer to buy or sell any securities. The use of any information contained in this document shall be at the sole discretion and risk of the user.
KT ZMICO RESEARCH – RECOMMENDATION DEFINITIONS STOCK RECOMMENDATIONS
SECTOR RECOMMENDATIONS
BUY: Expecting positive total returns of 15% or more OVERWEIGHT: The industry, as defined by the analyst's over the next 12 months coverage universe, is expected to outperform the relevant OUTPERFORM: Expecting total returns between ‐10% primary market index by at least 10% over the next 12 months. to +15%; returns expected to exceed market returns NEUTRAL: The industry, as defined by the analyst's coverage over a six‐month period due to specific catalysts universe, is expected to perform in line with the relevant UNDERPERFORM: Expecting total returns between primary market index over the next 12 months. ‐10% to +15%; returns expected to be below market UNDERWEIGHT: The industry, as defined by the analyst's returns over a six‐month period due to specific coverage universe, is expected to underperform the relevant catalysts primary market index by 10% over the next 12 months. SELL: Expecting negative total returns of 10% or more over the next 12 months
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 3
KT ZMICO Securities Company Limited Head Office
WWW.KTZMICO.COM
8th, 15th‐17th,19th, 21st Floor, Liberty Square Bldg., 287 Silom Road, Bangrak, Bangkok, Thailand 10500 Telephone: (66‐2) 695‐5000 Fax: (66‐2) 695‐5173 KT ZMICO Connect 662 695 5555
Central World Branch
Amarin Branch
22nd Floor, Amarin Building, 496‐502 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 018‐6200 Fax: (66‐2) 018‐6298, (66‐2) 018‐6299
8th Floor, Ton Son Tower, 900 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 626‐6000 Fax: (66‐2) 626‐6111
Phaholyothin Branch
Sindhorn Branch
Viphavadee Branch
2nd Floor, Sindhorn Tower 1, 130‐132 Wireless Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 627‐3550 Fax: (66‐2) 627‐3582, 627‐3600
G Floor, Lao Peng Nguan 1 Bldg., 333 Soi Cheypuand, Viphavadee‐Rangsit Road, Ladyao, Jatujak, Bangkok 10900 Telephone: (66‐2) 013‐8600 Fax: (66‐2) 618‐8569
BangKhae Branch
Chiang Mai Branch
Pak Chong Branch
999/9 The Offices at Central World, 16th Fl., Rama 1 Rd, Pathumwan, Bangkok 10330 Telephone: (66‐2) 264‐5888 Fax: (66‐2) 264 5899
1291/1, Shinnawatra Tower II, 3rd Floor, Phaholyothin Road, Phayathai, Bangkok 10400 Telephone: (66‐2) 686‐1500 Fax: (66‐2) 686‐1666
Ploenchit Branch
518 The Mall Group Building Bangkhae Branch, 6th Floor, Petchkasem Road, North Bangkhae, Bangkhae, Bangkok 10160 Telephone: (66‐2) 454‐9979 Fax: (66‐2) 454‐9970
422/49 Changklan Road, Changklan Subdistrict, Amphoe Meuang, Chiang Mai 50100 Telephone: (053) 270‐072 Fax: (053) 272‐618
173 175, Mittapap Road, Nong Sarai, Pak Chong, Nakhon Ratchasima 30130 Telephone: (044) 279‐511 Fax: (044) 279‐574
Korat Branch
Khon Kaen Branch
Chonburi Branch
624/9 Changphuek Road, T.Naimaung, A.Maung, Nakhon Ratchasima 30000 Telephone: (044) 247222 Fax: (044) 247171
5th Floor, Charoen Thani Princess Hotel, 260 Srichan Road, T. Naimuang, A. Muang, Khon Kaen 40000 Telephone: (043) 389‐171‐193 Fax: (043) 389‐209
4th Floor, Forum Plaza Bldg., 870/52 Sukhumvit Road, T. Bangplasoy, A. Muang, Cholburi 20000 Telephone: (038) 287‐635 Fax: (038) 287‐637
Pattaya Branch
Chachoengsao Branch
Hat Yai Branch
Easy Point 2, 392/65 Moo.9, T.Nong Prue, A. Bang Lamung, Chonburi 20260 Telephone: (038) 420‐965 Fax: (038) 420‐968
108/34‐36 Mahajakkrapad Road, T.Namuang, A.Muang, Chachoengsao 24000 Telephone: (038) 813‐088 Fax: (038) 813‐099
200/301, 200/303 JULDIS HATYAI PLAZA Floor 3 , Niphat‐Uthit 3 Rd, Hatyai Songkhla 90110 Telephone: (074) 355530‐3 Fax: (074) 355534
Phuket Branch
22/61‐63, Luang Por Wat Chalong Road, Talat Yai, Mueang Phuket, Phuket 83000 Telephone: (076) 222‐811, (076) 222‐683 Fax: (076) 222‐861
Phitsanulok Branch
227/171 Borom Trilokkanat Road, Muang, Phitsanulok 65000 Telephone: 055‐219‐255 to 8 Fax: 055‐219‐259
Nakhon Pathom
Cyber Branch Ayutthaya
Cyber Branch @ North Nana
Cyber Branch Chiangrai
KrungThai Bank, Rojana Branch 253 Moo 5, Rojana Road, Phai Ling, Phra Nakhon Si Ayutthaya, Phra Nakhonsi Ayutthaya, 13000 Telephone: 035‐242‐477 Fax: 035‐242‐476
Krung Thai Bank PCL, 2 Floor, North Nana Branch 35 Sukhumvit Rd., Klong Toey Nua Subdistrict , Wattana District , Bangkok 10110 Telephone: 083‐490‐2871
River Hotel (Building 3rd),1156 Petchakasem Road, Sanamchan Subdistrict, Amphoe Meuang , Nakhon Pathom Province 73000 Telephone: (034) 271300 Fax: (034) 271300 #100
KrungThai Bank, Hayaek Phokhun Mengrai Branch 116/19 Moo 19, Highway 110 Road, Rop Wiang, Mueang Chiang Rai, Chiang Rai, 57000 Telephone: 053‐715‐067 Fax: 053‐715‐068
