3Q15 net profit ahead of estimate on higher investment gain
Kiatnakin Bank Outperform (16E TP Bt36.00)
Earnings Review
Close Bt32.50
Banking October 20, 2015
Beat forecast/Below forecast/In line
3Q15 net profit ahead of estimate on higher investment gain Price Performance (%)
Source: SET Smart
FY15
FY16
Consensus EPS (Bt)
3.451
4.068
KT ZMICO vs. consensus Share data
3.2%
1.3%
Reuters / Bloomberg
KKP.BK/KKP TB
Paid‐up Shares (m)
846.75
Par (Bt)
10.00
Market cap (Bt bn / US$ m)
28.00/778.00
Foreign limit / actual (%)
44.00/31.22
52 week High / Low (Bt)
42.50/29.50
Avg. daily T/O (shares 000)
840.00
NVDR (%)
5.56
Estimated free float (%)
76.48
Beta
0.62
URL
www.kiatnakin.co.th
CGR
Anti‐corruption
Level 4 (Certified)
Better asset quality on HP loans and cheap valuation are main appeals We maintain an Outperform rating for KKP given its undemanding valuations, which should largely reflect most concerns on the stock and post limited downside risk to its share price. Moreover, the continued improvement of the asset quality outlook for auto hire purchase loans and its solid dividend yield of ~6% should be other appeals. 3Q15 net profit surpassed both our forecast and the street KKP posted 3Q15 net profit (NP) of Bt923mn (+9% YoY, +23% QoQ), beating our forecast (Bt755mn) and the street estimate (Bt741mn). The higher‐than‐expected NP was due largely to the strong performance of the capital market units as it booked huge investment gain of Bt253mn (especially from the equity derivatives trading and hedge fund units) and gain of Bt201mn on trading and FX transactions in 3Q15, with both being significantly ahead of our forecasts. Given such extra gains, KKP set aside a higher provision at Bt941mn in 3Q15 (including a general provision of Bt600mn) to act as a buffer against economic uncertainties. 3Q15 net profit stood at Bt923mn (+9% YoY, +23% QoQ) The higher NP both YoY and QoQ was due mainly to 1) the higher investment gain and gain on trading and FX transactions mentioned earlier; 2) higher NIM; and 3) a much lower loss on repossessed cars YoY. Note that the loss from repossessed cars in 3Q15 dropped sharply YoY to Bt370mn vs. the loss of Bt618mn in 3Q14, but was up QoQ from the loss of Bt288mn in 2Q15 as a higher number of repossessed cars were sold in 3Q15 due to more working days in 3Q15 vs. 2Q15. Meanwhile, loans were up 0.6% QoQ on the new booking of corporate loans in 3Q15 but still down ‐6% YoY and ‐4.3% YTD vs. our forecast of ‐5% for 2015E. Asset quality improved QoQ especially on auto hire purchase loans NPLs and the NPL ratio declined QoQ to 6.6% from 6.9%, mainly from the continued lower NPLs in auto hire purchase loans as well as a slight decline in NPLs for residential project loans. The lower NPLs and higher provisioning in 3Q15 resulted in a higher reserve to the BoT’s required reserve QoQ to 155% from 145% and a higher reserve‐to‐NPL ratio QoQ to 80% from 73%. Maintain earnings forecast The 9M15 net profit of Bt2.3bn (+8% YoY) represented 78% of our FY15 NP forecast; thus, we maintain our earnings forecast for 2015E. Financials and Valuation
Prapharas Nonthapiboon Analyst, no 17836 [email protected] 66 (0) 2695‐5872
FY Ended 31 Dec PPOP (Btm) Net profit (Btm) EPS (Bt) EPS growth (%) Book value (Bt) Dividend (Bt) FY Ended 31 Dec PER (X) PBV (X) Dividend yield (%) ROE (%)
2013 5,058 4,418 5.27 29.3% 41.66 2.65 2013 6.17 0.73 8.15 13.0%
2014 5,752 2,636 3.13 ‐40.6% 42.77 1.85 2014 10.39 0.73 5.69 7.4%
2015E 4,983 3,005 3.56 14.0% 44.48 1.90 2015E 9.12 0.73 5.84 8.2%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
2016E 4,650 3,470 4.12 15.5% 46.71 2.06 2016E 7.89 0.70 6.33 9.0%
2017E 4,616 4,311 5.11 24.2% 49.76 2.56 2017E 6.35 0.65 7.87 10.6%
Figure 1: 3Q15 earnings results Statement of comprehensive income (Btmn) Fiscal Year-Ended December
3Q14
9M15 % YoY
2,300
2,202
2,476
8%
12%
6,548
6,879
5%
8,606
-4%
Non Interest Income
1,021
838
1,362
33%
63%
2,399
3,401
42%
4,444
17%
77%
Operating Income
3,320
3,040
3,838
16%
26%
8,946
10,280
15%
13,049
2%
79%
Operating Expenses
1,711
1,565
1,692
-1%
8%
4,727
4,946
5%
6,626
1%
75%
Operating Profit
1,635
1,539
1,692
4%
10%
4,660
4,719
1%
5,697
-7%
83%
Provision for loan loss (Reversal)
570
524
941
65%
80%
1,674
2,384
42%
2,704
-15%
88%
Taxes expenses (Reversal)
187
191
264
42%
39%
355
575
62%
669
90%
86%
Net Profit
847
749
923
9%
23%
2,170
2,337
8%
3,005
14%
78%
1,442
1,337
1,411
-2%
5%
4,285
4,105
-4%
4,983
-13%
82%
1.01
0.89
1.09
8%
23%
2.58
2.77
7%
3.56
14%
78%
3Q14
2Q15
3Q15
9M14
9M15
2015E
10,483 12,097 11,587
10,483
11,587
12,940
PPOP-after tax EPS (Bt) Key Statistics & Ratios Gross NPLs (Btmn) Gross NPLs/Loans Loan Loss Reserve/NPLs
2Q15
3Q15 % YoY % QoQ
2015E % YoY % 9M to 15E
9M14
Net Interest Income
5.6%
6.9%
6.6%
5.6%
6.6%
7.4%
71.3%
72.6%
79.7%
71.3%
79.7%
80.0% 14.5%
Tier I/Risk Asset
14.4%
14.8%
14.9%
14.4%
14.9%
C apital Adequacy Ratio
14.8%
15.1%
14.5%
14.8%
14.5%
15.2%
Loan to Deposit Ratio
132.2% 146.1% 164.1%
132.2% 164.1%
140.0%
Loan to Deposit & ST borrowing
130.3% 145.8% 164.1%
130.3% 164.1%
139.8%
Provision to loans
1.22%
1.20%
1.07%
1.16%
1.43%
1.55%
C ost to Income
51.5%
51.5%
44.1%
52.8%
48.1%
50.8%
Non-interest Income/Total Income
30.7%
27.6%
35.5%
26.8%
33.1%
34.1%
Net Interest Margin
3.86%
4.03%
4.63%
3.69%
4.21%
3.89%
Interest Spread
3.79%
4.05%
4.72%
3.64%
4.21%
4.00%
Tax rate
18.0%
20.1%
22.0%
13.3% 19.04%
18.0%
Loan growth YoY
0.6%
-9.5%
-5.9%
0.6%
-5.9%
Loan growth QoQ
-3.2%
-3.0%
0.6%
-3.2%
0.6%
80%
-5.3%
Source: Bloomberg and KTZMICO Research
Figure 2: KKP's P/BV band and sensitivity of market prices based on P/BV at different standard deviation levels (X) 1.8
Source: Bloomberg, KT ZMICO Research
Oct-15
Nov-14
May-15
May-14
Jun-13
Dec-13
Jul-12
Jan-13
Feb-12
Mar-11
Jan-07
Jun-07
0.2
Aug-11
-2S.D.
Sep-10
0.4
-1 S.D.
Oct-09
0.6
Mar-10
0.8
Avg. -0.5 S.D.
Apr-09
1.0
+1 S.D. +0.5 S.D.
Nov-08
1.2
+2 S.D.
Dec-07
1.4
May-08
1.6
2015E
PBV (x)
+3 S.D.
Implied market
Upside/ Downside
price (Bt)
to current price (%)
+2.0SD
1.4
60
86
+1.5SD
1.2
55
69
+1.0SD
1.1
50
53
+0.5SD
1.0
45
37
Average
0.9
39
21
-0.5SD
0.8
34
5
-1.0SD
0.6
29
-11
-1.5SD
0.5
24
-28
-2.0SD
0.4
18
-44
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
Figure 3: KKP's PER band and sensitivity of market prices based on PER at different standard deviation levels 2015E
(X) 18
PER (x) Implied market price (Bt)
to current price (%)
14.1
50
55
12.6
45
39
11.2
40
23
16 14 12
+2 S.D.
+2.0SD
+1 S.D.
+1.5SD +1.0SD
10 8 6 4
Avg. -1 S.D. -2 S.D.
2
Source: Bloomberg, KT ZMICO Research
Oct-15
Nov-14
May-15
May-14
Jun-13
Dec-13
Jul-12
Jan-13
Feb-12
Mar-11
Aug-11
Sep-10
Oct-09
Mar-10
Apr-09
Nov-08
Dec-07
May-08
Jan-07
Jun-07
0
Upside/ Downside
+0.5SD
9.8
35
7
Average
8.3
30
-9
-0.5SD
6.9
24
-25
-1.0SD
5.4
19
-41
-1.5SD
4.0
14
-56
-2.0SD
2.5
9
-72
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 4
Note: KT ZMICO is a partnership between KTB and ZMICO. An executive of KT ZMICO Securities is also a board member of BCP, BTC, CI, KBS, PSL, SVH, VNG, ZMICO, CPI . KT ZMICO is a financial advisor for U, LOXLEY, SUTHA, ZMICO, MAKRO, CPALL, PLE, SAFARI, PACE, TPOLY, TFG. KT ZMICO is a co‐underwriter of KOOL, ORI, SCI, SR.
Anti‐corruption Progress Indicator
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 BUY: Expecting positive total returns of 15% or more over the next 12 months OUTPERFORM: Expecting total returns between ‐10% to +15%; returns expected to exceed market returns over a six‐month period due to specific catalysts UNDERPERFORM: Expecting total returns between ‐10% to +15%; returns expected to be below market returns over a six‐month period due to specific catalysts SELL: Expecting negative total returns of 10% or more over the next 12 months
SECTOR RECOMMENDATIONS OVERWEIGHT: The industry, as defined by the analyst's coverage universe, is expected to outperform the relevant primary market index by at least 10% over the next 12 months. NEUTRAL: The industry, as defined by the analyst's coverage universe, is expected to perform in line with the relevant primary market index over the next 12 months. UNDERWEIGHT: The industry, as defined by the analyst's coverage universe, is expected to underperform the relevant primary market index by 10% over the next 12 months.
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 4 of 4
th
th
th
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KT•ZMICO Securities Company Limited
st
8 , 15 -17 , 19 , 21 Floor, Liberty Square Bldg., 287 Silom Road, Bangrak, Bangkok 10500 Telephone: (66-2) 695-5000
Phaholyothin Branch
rd
Fax. (66-2) 631-1709
Ploenchit Branch
th
nd
2
Sindhorn Branch
3 Floor, Shinnawatra Tower II,
8 Floor, Ton Son Tower,
1291/1 Phaholyothin Road,
900 Ploenchit Road, Lumpini,
Floor, Sindhorn Tower 1, 130-132 Wireless Road, Lumpini,
Phayathai, Bangkok 10400
Pathumwan, Bangkok 10330
Pathumwan, Bangkok 10330
Telephone: (66-2) 686-1500
Telephone: (66-2) 626-6000
Telephone: (66-2) 627-3550
Fax. (66-2) 686-1666
Fax. (66-2) 626-6111
Fax. (66-2) 627-3582, 627-3600
Nakhon Pathom Branch 1156 Petchakasem Road, Sanamchan Subdistrict, Amphoe Meuang , Nakhon Pathom Province 73000 Telephone: (034) 271300 Fax: (034) 271300 #100
Chachoengsao Branch
Viphavadee Branch
Phitsanulok Branch
G Floor, Lao Peng Nguan 1 Bldg.,
Krung Thai Bank, Singhawat Branch
333 Soi Cheypuand, Viphavadee-Rangsit Road,
114 Singhawat Road,
Ladyao, Jatujak, Bangkok 10900
Muang, Phitsanulok 65000
Telephone: (66-2) 618-8500
Telephone: 083-490-2873
Fax. (66-2) 618-8569
th
Chonburi Branch
Pattaya Branch
108/34-36 Mahajakkrapad Road,
4 Floor, Forum Plaza Bldg.,
382/6-8 Moo 9, T. NongPrue,
T.Namuang, A.Muang,
870/52 Sukhumvit Road, T. Bangplasoy,
A. Banglamung, Cholburi 20260
Chachoengsao 24000
A. Muang, Cholburi 20000
Telephone: (038) 362-420-9
Telephone: (038) 813-088
Telephone: (038) 287-635
Fax. (038) 362-430
Fax. (038) 813-099
Fax. (038) 287-637
Khon Kaen Branch
5th Floor, Charoen Thani Princess Hotel,
Hat Yai Branch
Sriworajak Building Branch
200/301 Juldis Hatyai Plaza Floor 3,
1st – 2nd Floor, Sriworajak Building, 222
260 Srichan Road, T. Naimuang,
Niphat-Uthit 3 Rd,
Luang Road, Pomprab,
A. Muang, Khon Kaen 40000
Hatyai Songkhla 90110
Bankgok 10100
Telephone: (043) 389-171-193
Telephone: (074) 355-530-3
Telephone: (02) 689-3100
Fax. (043) 389-209
Fax: (074) 355-534
Fax. (02) 689-3199
Central World Branch
Chiang Mai Branch
Phuket Branch
999/9 The Offices at Central World,
422/49 Changklan Road, Changklan
22/61-63, Luang Por Wat Chalong Road,
16th Fl., Rama 1 Rd, Pathumwan,
Subdistrict, Amphoe Meuang,
Talat Yai, Mueang Phuket,
Bangkok 10330
Chiang Mai 50100
Phuket 83000
Telephone: (66-2) 673-5000,
Telephone: (053) 270-072
Tel. (076) 222-811,(076) 222-683
(66-2) 264-5888 Fax. (66-2) 264-5899
Fax: (053) 272-618
Fax. (076) 222-861
Pak Chong Branch
Cyber Branch @ North Nana
173 175, Mittapap Road,
Krung Thai Bank PCL, 2 Floor, North Nana Branch 35 Sukhumvit Rd.,Klong Toey Nua Subdistrict , Wattana District, Bangkok 10110 Telephone: 083-490-2871
Nong Sarai, Pak Chong, Nakhon Ratchasima 30130 Tel. (044) 279-511 Fax. (044) 279-574
Nakhon Ratchasima Branch
Bangkhae Branch
6th Floor The Mall Group Building Bangkhae 275 Moo 1 Petchkasem Road, North Bangkhae, Bangkhae, Bangkok 10160 Tel. (66-2) 454-9979 Fax. (66-2) 454-9970
624/9 Changphuek Road, . Naimaung, A.Maung, Nakhon Ratchasima 30000 Telephone: (044) 247222 Fax: (044) 247171 Information herein was obtained from sources believed to be reliable, but its completeness and accuracy are not guaranteed. All opinions expressed constitute our views on that date and are not intended as an offer or solicitation to sell or buy any securities. Investors should exercise care when making a decision to invest in securities. No one may modify or distribute any part of this report unless written permission is first received from Seamico Securities Plc. If any modifications are made, quotes or references taken from the report and the report date must be clearly mentioned and must not cause misunderstanding or damage to the company.
Earnings Review
Close Bt32.50
Banking October 20, 2015
Beat forecast/Below forecast/In line
3Q15 net profit ahead of estimate on higher investment gain Price Performance (%)
Source: SET Smart
FY15
FY16
Consensus EPS (Bt)
3.451
4.068
KT ZMICO vs. consensus Share data
3.2%
1.3%
Reuters / Bloomberg
KKP.BK/KKP TB
Paid‐up Shares (m)
846.75
Par (Bt)
10.00
Market cap (Bt bn / US$ m)
28.00/778.00
Foreign limit / actual (%)
44.00/31.22
52 week High / Low (Bt)
42.50/29.50
Avg. daily T/O (shares 000)
840.00
NVDR (%)
5.56
Estimated free float (%)
76.48
Beta
0.62
URL
www.kiatnakin.co.th
CGR
Anti‐corruption
Level 4 (Certified)
Better asset quality on HP loans and cheap valuation are main appeals We maintain an Outperform rating for KKP given its undemanding valuations, which should largely reflect most concerns on the stock and post limited downside risk to its share price. Moreover, the continued improvement of the asset quality outlook for auto hire purchase loans and its solid dividend yield of ~6% should be other appeals. 3Q15 net profit surpassed both our forecast and the street KKP posted 3Q15 net profit (NP) of Bt923mn (+9% YoY, +23% QoQ), beating our forecast (Bt755mn) and the street estimate (Bt741mn). The higher‐than‐expected NP was due largely to the strong performance of the capital market units as it booked huge investment gain of Bt253mn (especially from the equity derivatives trading and hedge fund units) and gain of Bt201mn on trading and FX transactions in 3Q15, with both being significantly ahead of our forecasts. Given such extra gains, KKP set aside a higher provision at Bt941mn in 3Q15 (including a general provision of Bt600mn) to act as a buffer against economic uncertainties. 3Q15 net profit stood at Bt923mn (+9% YoY, +23% QoQ) The higher NP both YoY and QoQ was due mainly to 1) the higher investment gain and gain on trading and FX transactions mentioned earlier; 2) higher NIM; and 3) a much lower loss on repossessed cars YoY. Note that the loss from repossessed cars in 3Q15 dropped sharply YoY to Bt370mn vs. the loss of Bt618mn in 3Q14, but was up QoQ from the loss of Bt288mn in 2Q15 as a higher number of repossessed cars were sold in 3Q15 due to more working days in 3Q15 vs. 2Q15. Meanwhile, loans were up 0.6% QoQ on the new booking of corporate loans in 3Q15 but still down ‐6% YoY and ‐4.3% YTD vs. our forecast of ‐5% for 2015E. Asset quality improved QoQ especially on auto hire purchase loans NPLs and the NPL ratio declined QoQ to 6.6% from 6.9%, mainly from the continued lower NPLs in auto hire purchase loans as well as a slight decline in NPLs for residential project loans. The lower NPLs and higher provisioning in 3Q15 resulted in a higher reserve to the BoT’s required reserve QoQ to 155% from 145% and a higher reserve‐to‐NPL ratio QoQ to 80% from 73%. Maintain earnings forecast The 9M15 net profit of Bt2.3bn (+8% YoY) represented 78% of our FY15 NP forecast; thus, we maintain our earnings forecast for 2015E. Financials and Valuation
Prapharas Nonthapiboon Analyst, no 17836 [email protected] 66 (0) 2695‐5872
FY Ended 31 Dec PPOP (Btm) Net profit (Btm) EPS (Bt) EPS growth (%) Book value (Bt) Dividend (Bt) FY Ended 31 Dec PER (X) PBV (X) Dividend yield (%) ROE (%)
2013 5,058 4,418 5.27 29.3% 41.66 2.65 2013 6.17 0.73 8.15 13.0%
2014 5,752 2,636 3.13 ‐40.6% 42.77 1.85 2014 10.39 0.73 5.69 7.4%
2015E 4,983 3,005 3.56 14.0% 44.48 1.90 2015E 9.12 0.73 5.84 8.2%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
2016E 4,650 3,470 4.12 15.5% 46.71 2.06 2016E 7.89 0.70 6.33 9.0%
2017E 4,616 4,311 5.11 24.2% 49.76 2.56 2017E 6.35 0.65 7.87 10.6%
Figure 1: 3Q15 earnings results Statement of comprehensive income (Btmn) Fiscal Year-Ended December
3Q14
9M15 % YoY
2,300
2,202
2,476
8%
12%
6,548
6,879
5%
8,606
-4%
Non Interest Income
1,021
838
1,362
33%
63%
2,399
3,401
42%
4,444
17%
77%
Operating Income
3,320
3,040
3,838
16%
26%
8,946
10,280
15%
13,049
2%
79%
Operating Expenses
1,711
1,565
1,692
-1%
8%
4,727
4,946
5%
6,626
1%
75%
Operating Profit
1,635
1,539
1,692
4%
10%
4,660
4,719
1%
5,697
-7%
83%
Provision for loan loss (Reversal)
570
524
941
65%
80%
1,674
2,384
42%
2,704
-15%
88%
Taxes expenses (Reversal)
187
191
264
42%
39%
355
575
62%
669
90%
86%
Net Profit
847
749
923
9%
23%
2,170
2,337
8%
3,005
14%
78%
1,442
1,337
1,411
-2%
5%
4,285
4,105
-4%
4,983
-13%
82%
1.01
0.89
1.09
8%
23%
2.58
2.77
7%
3.56
14%
78%
3Q14
2Q15
3Q15
9M14
9M15
2015E
10,483 12,097 11,587
10,483
11,587
12,940
PPOP-after tax EPS (Bt) Key Statistics & Ratios Gross NPLs (Btmn) Gross NPLs/Loans Loan Loss Reserve/NPLs
2Q15
3Q15 % YoY % QoQ
2015E % YoY % 9M to 15E
9M14
Net Interest Income
5.6%
6.9%
6.6%
5.6%
6.6%
7.4%
71.3%
72.6%
79.7%
71.3%
79.7%
80.0% 14.5%
Tier I/Risk Asset
14.4%
14.8%
14.9%
14.4%
14.9%
C apital Adequacy Ratio
14.8%
15.1%
14.5%
14.8%
14.5%
15.2%
Loan to Deposit Ratio
132.2% 146.1% 164.1%
132.2% 164.1%
140.0%
Loan to Deposit & ST borrowing
130.3% 145.8% 164.1%
130.3% 164.1%
139.8%
Provision to loans
1.22%
1.20%
1.07%
1.16%
1.43%
1.55%
C ost to Income
51.5%
51.5%
44.1%
52.8%
48.1%
50.8%
Non-interest Income/Total Income
30.7%
27.6%
35.5%
26.8%
33.1%
34.1%
Net Interest Margin
3.86%
4.03%
4.63%
3.69%
4.21%
3.89%
Interest Spread
3.79%
4.05%
4.72%
3.64%
4.21%
4.00%
Tax rate
18.0%
20.1%
22.0%
13.3% 19.04%
18.0%
Loan growth YoY
0.6%
-9.5%
-5.9%
0.6%
-5.9%
Loan growth QoQ
-3.2%
-3.0%
0.6%
-3.2%
0.6%
80%
-5.3%
Source: Bloomberg and KTZMICO Research
Figure 2: KKP's P/BV band and sensitivity of market prices based on P/BV at different standard deviation levels (X) 1.8
Source: Bloomberg, KT ZMICO Research
Oct-15
Nov-14
May-15
May-14
Jun-13
Dec-13
Jul-12
Jan-13
Feb-12
Mar-11
Jan-07
Jun-07
0.2
Aug-11
-2S.D.
Sep-10
0.4
-1 S.D.
Oct-09
0.6
Mar-10
0.8
Avg. -0.5 S.D.
Apr-09
1.0
+1 S.D. +0.5 S.D.
Nov-08
1.2
+2 S.D.
Dec-07
1.4
May-08
1.6
2015E
PBV (x)
+3 S.D.
Implied market
Upside/ Downside
price (Bt)
to current price (%)
+2.0SD
1.4
60
86
+1.5SD
1.2
55
69
+1.0SD
1.1
50
53
+0.5SD
1.0
45
37
Average
0.9
39
21
-0.5SD
0.8
34
5
-1.0SD
0.6
29
-11
-1.5SD
0.5
24
-28
-2.0SD
0.4
18
-44
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
Figure 3: KKP's PER band and sensitivity of market prices based on PER at different standard deviation levels 2015E
(X) 18
PER (x) Implied market price (Bt)
to current price (%)
14.1
50
55
12.6
45
39
11.2
40
23
16 14 12
+2 S.D.
+2.0SD
+1 S.D.
+1.5SD +1.0SD
10 8 6 4
Avg. -1 S.D. -2 S.D.
2
Source: Bloomberg, KT ZMICO Research
Oct-15
Nov-14
May-15
May-14
Jun-13
Dec-13
Jul-12
Jan-13
Feb-12
Mar-11
Aug-11
Sep-10
Oct-09
Mar-10
Apr-09
Nov-08
Dec-07
May-08
Jan-07
Jun-07
0
Upside/ Downside
+0.5SD
9.8
35
7
Average
8.3
30
-9
-0.5SD
6.9
24
-25
-1.0SD
5.4
19
-41
-1.5SD
4.0
14
-56
-2.0SD
2.5
9
-72
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 4
Note: KT ZMICO is a partnership between KTB and ZMICO. An executive of KT ZMICO Securities is also a board member of BCP, BTC, CI, KBS, PSL, SVH, VNG, ZMICO, CPI . KT ZMICO is a financial advisor for U, LOXLEY, SUTHA, ZMICO, MAKRO, CPALL, PLE, SAFARI, PACE, TPOLY, TFG. KT ZMICO is a co‐underwriter of KOOL, ORI, SCI, SR.
Anti‐corruption Progress Indicator
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 BUY: Expecting positive total returns of 15% or more over the next 12 months OUTPERFORM: Expecting total returns between ‐10% to +15%; returns expected to exceed market returns over a six‐month period due to specific catalysts UNDERPERFORM: Expecting total returns between ‐10% to +15%; returns expected to be below market returns over a six‐month period due to specific catalysts SELL: Expecting negative total returns of 10% or more over the next 12 months
SECTOR RECOMMENDATIONS OVERWEIGHT: The industry, as defined by the analyst's coverage universe, is expected to outperform the relevant primary market index by at least 10% over the next 12 months. NEUTRAL: The industry, as defined by the analyst's coverage universe, is expected to perform in line with the relevant primary market index over the next 12 months. UNDERWEIGHT: The industry, as defined by the analyst's coverage universe, is expected to underperform the relevant primary market index by 10% over the next 12 months.
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 4 of 4
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KT•ZMICO Securities Company Limited
st
8 , 15 -17 , 19 , 21 Floor, Liberty Square Bldg., 287 Silom Road, Bangrak, Bangkok 10500 Telephone: (66-2) 695-5000
Phaholyothin Branch
rd
Fax. (66-2) 631-1709
Ploenchit Branch
th
nd
2
Sindhorn Branch
3 Floor, Shinnawatra Tower II,
8 Floor, Ton Son Tower,
1291/1 Phaholyothin Road,
900 Ploenchit Road, Lumpini,
Floor, Sindhorn Tower 1, 130-132 Wireless Road, Lumpini,
Phayathai, Bangkok 10400
Pathumwan, Bangkok 10330
Pathumwan, Bangkok 10330
Telephone: (66-2) 686-1500
Telephone: (66-2) 626-6000
Telephone: (66-2) 627-3550
Fax. (66-2) 686-1666
Fax. (66-2) 626-6111
Fax. (66-2) 627-3582, 627-3600
Nakhon Pathom Branch 1156 Petchakasem Road, Sanamchan Subdistrict, Amphoe Meuang , Nakhon Pathom Province 73000 Telephone: (034) 271300 Fax: (034) 271300 #100
Chachoengsao Branch
Viphavadee Branch
Phitsanulok Branch
G Floor, Lao Peng Nguan 1 Bldg.,
Krung Thai Bank, Singhawat Branch
333 Soi Cheypuand, Viphavadee-Rangsit Road,
114 Singhawat Road,
Ladyao, Jatujak, Bangkok 10900
Muang, Phitsanulok 65000
Telephone: (66-2) 618-8500
Telephone: 083-490-2873
Fax. (66-2) 618-8569
th
Chonburi Branch
Pattaya Branch
108/34-36 Mahajakkrapad Road,
4 Floor, Forum Plaza Bldg.,
382/6-8 Moo 9, T. NongPrue,
T.Namuang, A.Muang,
870/52 Sukhumvit Road, T. Bangplasoy,
A. Banglamung, Cholburi 20260
Chachoengsao 24000
A. Muang, Cholburi 20000
Telephone: (038) 362-420-9
Telephone: (038) 813-088
Telephone: (038) 287-635
Fax. (038) 362-430
Fax. (038) 813-099
Fax. (038) 287-637
Khon Kaen Branch
5th Floor, Charoen Thani Princess Hotel,
Hat Yai Branch
Sriworajak Building Branch
200/301 Juldis Hatyai Plaza Floor 3,
1st – 2nd Floor, Sriworajak Building, 222
260 Srichan Road, T. Naimuang,
Niphat-Uthit 3 Rd,
Luang Road, Pomprab,
A. Muang, Khon Kaen 40000
Hatyai Songkhla 90110
Bankgok 10100
Telephone: (043) 389-171-193
Telephone: (074) 355-530-3
Telephone: (02) 689-3100
Fax. (043) 389-209
Fax: (074) 355-534
Fax. (02) 689-3199
Central World Branch
Chiang Mai Branch
Phuket Branch
999/9 The Offices at Central World,
422/49 Changklan Road, Changklan
22/61-63, Luang Por Wat Chalong Road,
16th Fl., Rama 1 Rd, Pathumwan,
Subdistrict, Amphoe Meuang,
Talat Yai, Mueang Phuket,
Bangkok 10330
Chiang Mai 50100
Phuket 83000
Telephone: (66-2) 673-5000,
Telephone: (053) 270-072
Tel. (076) 222-811,(076) 222-683
(66-2) 264-5888 Fax. (66-2) 264-5899
Fax: (053) 272-618
Fax. (076) 222-861
Pak Chong Branch
Cyber Branch @ North Nana
173 175, Mittapap Road,
Krung Thai Bank PCL, 2 Floor, North Nana Branch 35 Sukhumvit Rd.,Klong Toey Nua Subdistrict , Wattana District, Bangkok 10110 Telephone: 083-490-2871
Nong Sarai, Pak Chong, Nakhon Ratchasima 30130 Tel. (044) 279-511 Fax. (044) 279-574
Nakhon Ratchasima Branch
Bangkhae Branch
6th Floor The Mall Group Building Bangkhae 275 Moo 1 Petchkasem Road, North Bangkhae, Bangkhae, Bangkok 10160 Tel. (66-2) 454-9979 Fax. (66-2) 454-9970
624/9 Changphuek Road, . Naimaung, A.Maung, Nakhon Ratchasima 30000 Telephone: (044) 247222 Fax: (044) 247171 Information herein was obtained from sources believed to be reliable, but its completeness and accuracy are not guaranteed. All opinions expressed constitute our views on that date and are not intended as an offer or solicitation to sell or buy any securities. Investors should exercise care when making a decision to invest in securities. No one may modify or distribute any part of this report unless written permission is first received from Seamico Securities Plc. If any modifications are made, quotes or references taken from the report and the report date must be clearly mentioned and must not cause misunderstanding or damage to the company.
