Banking
Banking Industry Update
Neutral
9 July 2015
Weak 2Q15E earnings; 2H outlooks remain challenging
Share data (Banking) SET index
1,470.25
Sector index
479.13
52‐week high
688.00
52‐week low
479.13
Market capitalization (Bt m)
2,001,518.25
% of market cap
14.48
Avg daily turnover (m shares)
314.90
Beta
2.75
Sector Performance (%)
1M
3M
12M
Absolute
‐7.60
‐20.11
‐19.93
Relative
‐5.21
‐16.04
‐16.72
Note: KT•ZMICO is a partnership between KTB and ZMICO
Prapharas Nonthapiboon Analyst, no 17836 [email protected] 66 (0) 2695‐5872
Current trough valuations could largely reflect the potential negatives We are maintaining our Neutral stance for the banking sector given that banks should still face challenging operating environments in 2H15‐16E due the potential of prolonged weak macro fronts, especially in regard to higher asset quality risk. However, banks’ current trough valuations with current P/BV at historically low levels (i.e., P/BV at ‐ 1SD, see Figure 7) could largely price in these concerns and leave narrower downside risk of further share price weakness. However, for the near‐term strategy, we see further sharp price dips posting a buying opportunity from a trading perspective. We now choose BBL as our only top pick in the sector as we expect the bank to be in a better position to withstand the likelihood of prolonged headwinds. Expect 2Q15E net profit of Bt42bn (‐14% YoY, ‐12% QoQ) The weak NP should be due mainly to 1) lower NIM on the rate cut impact and higher NPLs; 2) higher provisions (likely +38% YoY and +23% QoQ). Meanwhile, loan growth should remain slow and NPLs should continue to be higher QoQ. Fee income should be the only bright spot at the moment, especially for large banks. However, this will not be able to offset the much higher provisions and lower NIM. Smaller banks to see better earnings momentum vs. peers in 2Q15E We expect smaller banks, especially banks with higher exposure to auto hire purchase loans (i.e., TCAP and TISCO) to see better earnings momentum vs. the sector. This should be thanks mainly to the benefit of the rate cut environment (with expected NIM improvement by around 5‐10 bps for TCAP and KKP QoQ and ~+15 bps for TISCO) and lower losses on repossessed cars both YoY and QoQ. Asset quality to remain key earnings pressure Asset quality should remain an ongoing concern and the key pressure for banks’ earnings. NPLs should continue on an uptrend at least until the end of this year, reflecting the weak macro fronts. SME loans are likely to post higher risk at the moment, followed by some retail loan segments. Specifically, we are likely to see higher NPL risk for KTB (mainly in mortgage lending) and KKP (mainly in residential project lending) compared with direct peers. Note that we already revised down earnings for most banks to factor in higher NPL risk, except for KTB and KKP, for which we see further potential earnings downgrades vs. our currents forecasts.
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 8
Expect 2Q15E net profit of Bt42bn (‐14% YoY, ‐12% QoQ) We expect the eight banks under our coverage to show net profit (NP) of Bt42bn in 2Q15E (‐14% YoY, ‐12% QoQ); see Figure 1‐3. The weak NP both YoY and QoQ should be due mainly to 1) net interest margin (NIM) contraction (mainly on large to mid size banks) on the rate cut impact and higher NPLs; and 2) higher provision expenses (likely +38% YoY and +23% QoQ) in most banks due to higher NPL risks. Meanwhile, loan growth should remain slim at around +0.7% QoQ and +1.5% YTD. Fee income should be the only bright spot at the moment, especially for large banks. However, this will not be able to offset the much higher provision and lower NIM. Meanwhile, NPLs should be higher QoQ, mainly from SME loans, followed by retail loans. Specifically, we are likely to see higher NPL risks for KTB (mainly in mortgage lending) and KKP (mainly in residential project lending as the bank focuses on mid‐to‐small developers) compared with direct peers. Figure 1: Net profit forecasts vs. growth Banks BBL
Net profit (Btmn)
Change (%)
2Q14
1Q15
2Q15E
YoY
QoQ
9,029
9,407
8,176
-9%
-13%
KTB
7,540
7,929
6,197
-18%
-22%
KBANK
11,732
12,401
9,355
-20%
-25%
SCB
14,723
13,152
12,845
-13%
-2%
TMB
2,575
1,638
2,046
-21%
25%
KKP
601
664
656
9%
-1%
TCAP
1,235
1,332
1,354
10%
2%
TISCO Total
992 48,427
1,192 47,714
1,198 41,827
21% -14%
0% -12%
Change YoY 29% 34% 78% 30% 337% 132% -12% -18% 38%
(%) QoQ 1% 93% 35% 16% -43% -17% 15% 3% 23%
Source: Banks, KT ZMICO Research
Figure 2: Provision expenses Year-end 31 Dec. BBL KTB KBANK SCB TMB KKP TCAP TISCO Total
Provision (Btmn) 2Q14 1Q15 2Q15E 2,331 2,980 3,000 5,365 3,724 7,200 3,036 4,007 5,400 3,220 3,601 4,192 309 2,387 1,350 327 918 760 2,158 1,647 1,900 1,225 972 1,000 17,971 20,236 24,802
Source: Banks, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 8
Figure 3: Loan growth Year-end 31 Dec. BBL KTB KBANK SCB TMB KKP TCAP TISCO Total
Loan growth (QoQ) 2Q14 1Q15 2Q15E 1.1% -0.4% 0.6% 2.5% 0.1% 1.4% 1.5% 1.4% 1.5% -0.1% 1.8% 0.7% 1.8% 1.6% 1.0% -1.8% -1.9% -1.6% -0.9% -3.3% -1.6% -1.5% -3.2% -1.7% 0.9% 0.8% 0.7%
Loan growth YoY (%) YTD 1.1% 0.1% 9.4% 1.4% 6.8% 2.9% 5.2% 2.6% 6.9% 2.7% -8.1% -3.4% -8.2% -4.8% -10.8% -4.8% 3.6% 1.5%
Source: Banks, KT ZMICO Research
Figure 4: Rating and Valuation Summary Banks
Rating
BBL KTB* KBANK SC B TMB KKP* TC AP TISC O
Outperform Unrated Underperform Underperform Underperform Underperform Underperform Underperform
Sector
Neutral
PER (X) P/BV (X) Target Price 15E (Bt) 2015E 2016E 2015E 2016E 192 9.6 8.8 1.0 0.9 23.50 6.8 6.1 0.9 0.8 210 10.9 9.5 1.5 1.3 165 10.2 9.4 1.6 1.4 2.40 12.8 11.0 1.3 1.2 41.00 7.8 6.5 0.7 0.7 36.00 7.4 6.8 0.8 0.7 46.00 7.6 7.0 1.3 1.1
10.6
9.6
1.2
1.1
ROE (%) 2015E
2016E
10.3 14.1 14.7 16.5 10.8 9.6 10.6 17.5
10.6 14.2 14.9 16.1 11.5 10.8 10.7 17.1
12.2
12.3
Div. yield (%)
2015E 2016E 3.78 3.78 5.72 6.03 2.20 2.48 4.04 4.04 2.63 2.90 6.40 7.64 5.19 5.50 5.39 5.73 4.23
4.59
Source: Bloomberg, KT ZMICO Research * Earnings and target price are under review for possible downgrades.
Figure 5: Sensitivity of bank market prices based on P/BV at different standard deviation levels (SD) Market Price (Bt.)
+2.0SD
8-Jul-15
+1.5SD +1SD +0.5SD
Avg.
-0.5SD -1SD -1.5SD -2.0SD 2013-2015
Price P/BV(x)
High
Low
BAY
32.25
1.34
57
52
47
42
37
32
27
22
17
104
28
BBL
172.0
0.97
271
256
240
224
209
193
178
162
146
237
165 146
181.50
1.51
298
277
256
235
215
194
173
152
131
252
KKP
KBANK
33.00
0.73
62
56
51
45
40
35
29
24
19
71
34
KTB
16.60
0.91
32
29
27
24
21
18
15
12
10
28
15
SC B
131
148.50
1.60
251
236
221
206
192
177
162
147
132
200
TC AP
32.75
0.76
56
51
46
41
36
31
26
21
16
50
30
TISC O
45.25
1.26
74
68
63
57
52
46
40
35
29
61
35
2.28
1.33
3.92
3.57
3.22
2.88
2.53
2.18
1.83
1.48
1.13
3.24
1.87
479.1
1.3
795
741
686
631
577
522
468
413
359
688
428
TMB SETBANK
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 8
Figure 6: Banks’ share price performance & relative performance vs. SETBANK and SET 2013 - 2015
C losed(Bt)
8-Jul-15 High 1,470 1,643 479 688
SET BANK Banking BAY BBL KBANK KKP KTB SC B TC AP TISC O TMB LHBANK
32.25 172.00 181.50 33.00 16.60 148.50 32.75 45.25 2.28 1.79
Price change (%)
Low 1,225 428
104.00 237.00 252.00 71.25 27.75 199.50 50.25 60.75 3.24 2.28
1W 1M 1Q YTD 1Y -2 -3 -2 -2 -2 -4 -8 -20 -19 -18
27.50 165.00 145.50 34.25 15.30 130.50 29.75 34.50 1.87 1.15
-3 -9 -25 -3 -4 -9 -4 -10 -22 -6 -8 -15 -3 -8 -29 -5 -7 -17 -2 -4 -6 -2 -3 -2 -3 -11 -25 -4 7 -5
-28 -11 -21 -16 -28 -19 2 3 -22 14
-31 -13 -16 -28 -26 -17 -8 9 -8 14
Relative to SETBA NK (%)
Relative to SET (%)
2Y High 1W 1M 1Q YTD 1Y 2Y High 1W 1M 2M 1Q YTD 5 -11 -6 -30 -1 -5 -17 -18 -16 -11 -20 -13 -9 4 -34 -12 -5 -11 13 -3 44
-69 -27 -28 -54 -40 -26 -35 -26 -30 -21
-1 -1 -2 -4 -1 -2 1 1 0 -2
-6 -2 -8 -6 -6 -5 -1 -1 -8 9
-23 -6 -20 -13 -27 -15 -3 0 -23 -2
-26 -9 -19 -15 -26 -17 4 5 -21 16
-29 -11 -13 -25 -23 -15 -6 12 -6 16
-18 -14 -1 -39 -17 -9 -16 8 -7 40
-58 -17 -17 -43 -30 -15 -24 -15 -19 -11
1 -1 0 3 0 -3 -3 -1 1 -1 -1 0 2 4 2 4 1 -3 -1 14
-5 -6 5 11 -1 -3 0 4 -6 -10 2 2 6 14 12 17 -1 -6 13 15
Source: Bloomberg, KT ZMICO Research Figure 7: P/BV of SETBANK P/BV (X)
3.6 3.2
Red‐shirt protest Fire at CTW (May‐10)
2.8
+2.0SD = 2.32x +1.5SD = 2.15x +1.0SD = 1.98x +0.5SD = 1.81x
2.4 2.0
Mean = 1.64x
1.6 -0.5SD = 1.47x -1.0SD = 1.30x
EU-US Debt crisis Widespread Flood
Coup
Jun-15
8 Jul 15 = 1.29x
Aug-14
May-12
Aug-11
Nov-10
Feb-10
May-09
Aug-08
Nov-07
Great US recession/Airport Closure
Apr-06
Jul-05
Oct-04
Jan-04
Apr-03
Jan-01
Oct-01
0.4
Jul-02
Military Coup (19 Sept‐06) Yellow‐shirt protest (07)
Jan-07
0.8
Feb-13
-2.0SD = 0.96x
Nov-13
1.2
Source: Banks, KT ZMICO Research Figure 8: SETBANK Index and PER Band (SETBANK Index) 1,000
800
15x 13x
600
11x
9x
400
Coup
7x
EU‐US Debt crisis Widespread Flood
200
Great US recession
-
Jan-15
Jan-14
Jan-13
Jan-12
Jan-11
Jan-10
Jan-09
Jan-08
Jan-07
Jan-06
Jan-05
Jan-04
Jan-03
Jan-02
-200
Source: Bloomberg, KT ZMICO Research REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 4 of 8
1Y
2Y High
-8 -13 -7 9 5 -3 -1 2 10 3 -10 -28 -8 -7 -6 1 1 1 22 10 -5 22 27 19 -3 10 3 34 32 50
-39 3 2 -23 -10 5 -4 5 1 9
Figure 9: Thai bank index vs. regional peers and MSCI Asia (ex Japan) Fin Index 300
MSCI Asia Ex JP FIN Thai Banks Index Indonesian Banks Index Singaporean Banks Index Malaysian Banks Index Hong Kong Banks Index Korean Banks Index Philippine Banks Index
275 250 225 200 175 150 125 100 75
Jan-10 Mar-10 May-10 Jul-10 Sep-10 Dec-10 Feb-11 Apr-11 Jun-11 Aug-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Aug-14 Oct-14 Dec-14 Feb-15 May-15 Jul-15
50
Source: Banks, KT ZMICO Research
Figure 10: Valuation summary vs. regional banks Market Price (Bt.)
+2.0SD
8-Jul-15
+1.5SD +1SD +0.5SD
Avg.
-0.5SD -1SD -1.5SD -2.0SD 2013-2015
Price P/BV(x)
High
Low
BAY
32.25
1.34
57
52
47
42
37
32
27
22
17
104
28
BBL
172.0
0.97
271
256
240
224
209
193
178
162
146
237
165 146
181.50
1.51
298
277
256
235
215
194
173
152
131
252
KKP
KBANK
33.00
0.73
62
56
51
45
40
35
29
24
19
71
34
KTB
16.60
0.91
32
29
27
24
21
18
15
12
10
28
15
SC B
131
148.50
1.60
251
236
221
206
192
177
162
147
132
200
TC AP
32.75
0.76
56
51
46
41
36
31
26
21
16
50
30
TISC O
45.25
1.26
74
68
63
57
52
46
40
35
29
61
35
2.28
1.33
3.92
3.57
3.22
2.88
2.53
2.18
1.83
1.48
1.13
3.24
1.87
479.1
1.3
795
741
686
631
577
522
468
413
359
688
428
TMB SETBANK
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 5 of 8
Figure 11: PBV Band of individual banks and SETBANK BAY’s PBV Band
BBL’s PBV Band
(X)
(X) 1.75
4.0 3.6
+2 S.D. 1.50
3.2
+1 S.D.
2.8 1.25
+2 S.D.
2.4
(X)
1.0 0.8
Source: Bloomberg, KT ZMICO Research
Source: Bloomberg, KT ZMICO Research
KTB’s PBV Band
SCB’s PBV Band
(X) 2.0
Jan-15
Jun-15
Mar-14
Jun-15
Jan-15
Mar-14
Aug-14
Oct-13
May-13
Dec-12
Jul-12
Feb-12
Sep-11
Mar-11
Oct-10
May-10
Dec-09
Jul-09
Feb-09
Nov-07
Jan-07
Jun-15
Jan-15
Mar-14
Aug-14
Oct-13
Dec-12
May-13
Jul-12
Feb-12
Sep-11
Mar-11
Oct-10
May-10
Dec-09
Jul-09
Feb-09
Sep-08
Apr-08
Nov-07
Jan-07
Jun-07
Jun-07
0.2
Sep-08
-2S.D.
0.4
0.6
Avg. -0.5 S.D.
-1 S.D.
0.6
-2 S.D.
1.1
+1 S.D. +0.5 S.D.
1.2
+0.5 S.D. Avg. -0.5 S.D. -1 S.D.
1.6
+2 S.D.
1.4
Apr-08
2.1
+3 S.D.
1.6
+1 S.D.
(X) 3.0
+2 S.D.
1.8
+2 S.D.
+1.5 S.D. +1 S.D.
1.6 1.4
+1.5 S.D. +1.0 S.D. +0.5 S.D. Avg.
2.5
+0.5 S.D. Avg.
1.2
0.6
Aug-14
(X) 1.8 +2 S.D.
0.8
Apr-13
KKP’s PBV Band
3.1
1.0
Sep-13
Nov-12
May-10
Jul-09
Dec-09
Feb-09
Apr-08
Sep-08
Nov-07
Source: Bloomberg, KT ZMICO Research
KBANK’s PBV Band
2.6
Jan-07
Jan-15
Jun-15
Aug-14
Oct-13
Mar-14
May-13
Jul-12
Dec-12
Feb-12
Sep-11
Oct-10
Mar-11
May-10
Jul-09
Dec-09
Feb-09
Apr-08
Sep-08
Nov-07
Jan-07
Jun-07
Source: Bloomberg, KT ZMICO Research
Jun-07
0.50
0.4
Jan-12
-2 S.D. Jun-12
0.8
-2 S.D. 0.75
Aug-11
-0.5 S.D. -1 S.D.
1.00
Oct-10
1.2
-1 S.D.
Mar-11
1.6
-0.5 S.D.
+1 S.D. +0.5 S.D. Avg.
2.0
+0.5 S.D. Avg.
2.0
-0.5 S.D. -1 S.D. -1.5 S.D.
1.5
-2 S.D.
-0.5 S.D. -1 S.D. -1.5 S.D. -2 S.D.
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 6 of 8
Jan-15
Jun-15
Mar-14
Source: Bloomberg, KT ZMICO Research
Aug-14
Oct-13
Dec-12
May-13
Jul-12
Feb-12
Sep-11
Mar-11
Oct-10
May-10
Dec-09
Jul-09
Feb-09
Sep-08
Apr-08
Jan-07
Jun-07
Jun-15
Jan-15
Mar-14
Aug-14
Sep-13
Apr-13
Nov-12
Jan-12
Jun-12
Aug-11
Oct-10
Mar-11
May-10
Jul-09
Dec-09
Feb-09
Sep-08
Jun-07
Nov-07
Jan-07
Apr-08
1.0
0.2
Nov-07
0.4
TCAP’s PBV Band
TISCO’s PBV Band (X)
(X)
2.4
1.6
+2 S.D. 1.4
+2 S.D.
2.0
1.2
+1 S.D.
1.0
+0.5 S.D.
1.6 1.2
-0.5 S.D.
0.8
0.4
Jun-15
Jan-15
Aug-14
Mar-14
Apr-13
Sep-13
Jun-12
Nov-12
Jan-12
Aug-11
Oct-10
Mar-11
Apr-10
Jun-09
Nov-09
Jan-09
Jan-15
Jun-15
Aug-14
Oct-13
Mar-14
May-13
Jul-12
Dec-12
Feb-12
Sep-11
Oct-10
Mar-11
May-10
Jul-09
Dec-09
Feb-09
Apr-08
Sep-08
Nov-07
Jan-07
Jun-07
0.4
Source: Bloomberg, KT ZMICO Research
Source: Bloomberg, KT ZMICO Research
TMB’s PBV Band
SETBANK’s PBV Band P/BV (X)
(X)
3.6 +2 S.D.
3.2
+1.5 S.D. +1 S.D.
2.8
+0.5 S.D. Avg.
2.4
-0.5 S.D.
Red‐shirt protest Fire at CTW (May‐10) +2.0SD = 2.32x +1.5SD = 2.15x +1.0SD = 1.98x +0.5SD = 1.81x
2.0
-1 S.D. -1.5 S.D.
Mean = 1.64x
1.6-0.5SD = 1.47x -1.0SD = 1.30x
EU-US Debt crisis Widespread Flood
Source: Bloomberg, KT ZMICO Research
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 7 of 8
Coup
Jun-15
8 Jul 15 = 1.29x Aug-14
Aug-11
May-12
Feb-10
Aug-08
May-09
Nov-07
Apr-06
Great US recession/Airport Closure Jan-07
Jul-05
Oct-04
Apr-03
Oct-01
Jan-04
Military Coup (19 Sept‐06) Yellow‐shirt protest (07)
0.4 Jan-01
Jun-15
Feb-15
Sep-14
May-14
Dec-13
Jul-13
Mar-13
Oct-12
Jun-12
Jan-12
Sep-11
Apr-11
Jul-10
Feb-10
Oct-09
Jan-09
May-09
0.0
Dec-10
0.8
Feb-13
-2.0SD = 0.96x
Nov-13
1.2
Nov-10
-2 S.D. 0.5
Jul-02
1.0
-2 S.D.
-2 S.D.
0.2
1.5
-0.5 S.D. -1 S.D. -1.5 S.D.
-1 S.D.
0.6
2.0
Avg.
Avg.
0.8
2.5
+1.5 S.D. +1 S.D. +0.5 S.D.
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 8 of 8
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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.
Neutral
9 July 2015
Weak 2Q15E earnings; 2H outlooks remain challenging
Share data (Banking) SET index
1,470.25
Sector index
479.13
52‐week high
688.00
52‐week low
479.13
Market capitalization (Bt m)
2,001,518.25
% of market cap
14.48
Avg daily turnover (m shares)
314.90
Beta
2.75
Sector Performance (%)
1M
3M
12M
Absolute
‐7.60
‐20.11
‐19.93
Relative
‐5.21
‐16.04
‐16.72
Note: KT•ZMICO is a partnership between KTB and ZMICO
Prapharas Nonthapiboon Analyst, no 17836 [email protected] 66 (0) 2695‐5872
Current trough valuations could largely reflect the potential negatives We are maintaining our Neutral stance for the banking sector given that banks should still face challenging operating environments in 2H15‐16E due the potential of prolonged weak macro fronts, especially in regard to higher asset quality risk. However, banks’ current trough valuations with current P/BV at historically low levels (i.e., P/BV at ‐ 1SD, see Figure 7) could largely price in these concerns and leave narrower downside risk of further share price weakness. However, for the near‐term strategy, we see further sharp price dips posting a buying opportunity from a trading perspective. We now choose BBL as our only top pick in the sector as we expect the bank to be in a better position to withstand the likelihood of prolonged headwinds. Expect 2Q15E net profit of Bt42bn (‐14% YoY, ‐12% QoQ) The weak NP should be due mainly to 1) lower NIM on the rate cut impact and higher NPLs; 2) higher provisions (likely +38% YoY and +23% QoQ). Meanwhile, loan growth should remain slow and NPLs should continue to be higher QoQ. Fee income should be the only bright spot at the moment, especially for large banks. However, this will not be able to offset the much higher provisions and lower NIM. Smaller banks to see better earnings momentum vs. peers in 2Q15E We expect smaller banks, especially banks with higher exposure to auto hire purchase loans (i.e., TCAP and TISCO) to see better earnings momentum vs. the sector. This should be thanks mainly to the benefit of the rate cut environment (with expected NIM improvement by around 5‐10 bps for TCAP and KKP QoQ and ~+15 bps for TISCO) and lower losses on repossessed cars both YoY and QoQ. Asset quality to remain key earnings pressure Asset quality should remain an ongoing concern and the key pressure for banks’ earnings. NPLs should continue on an uptrend at least until the end of this year, reflecting the weak macro fronts. SME loans are likely to post higher risk at the moment, followed by some retail loan segments. Specifically, we are likely to see higher NPL risk for KTB (mainly in mortgage lending) and KKP (mainly in residential project lending) compared with direct peers. Note that we already revised down earnings for most banks to factor in higher NPL risk, except for KTB and KKP, for which we see further potential earnings downgrades vs. our currents forecasts.
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 8
Expect 2Q15E net profit of Bt42bn (‐14% YoY, ‐12% QoQ) We expect the eight banks under our coverage to show net profit (NP) of Bt42bn in 2Q15E (‐14% YoY, ‐12% QoQ); see Figure 1‐3. The weak NP both YoY and QoQ should be due mainly to 1) net interest margin (NIM) contraction (mainly on large to mid size banks) on the rate cut impact and higher NPLs; and 2) higher provision expenses (likely +38% YoY and +23% QoQ) in most banks due to higher NPL risks. Meanwhile, loan growth should remain slim at around +0.7% QoQ and +1.5% YTD. Fee income should be the only bright spot at the moment, especially for large banks. However, this will not be able to offset the much higher provision and lower NIM. Meanwhile, NPLs should be higher QoQ, mainly from SME loans, followed by retail loans. Specifically, we are likely to see higher NPL risks for KTB (mainly in mortgage lending) and KKP (mainly in residential project lending as the bank focuses on mid‐to‐small developers) compared with direct peers. Figure 1: Net profit forecasts vs. growth Banks BBL
Net profit (Btmn)
Change (%)
2Q14
1Q15
2Q15E
YoY
QoQ
9,029
9,407
8,176
-9%
-13%
KTB
7,540
7,929
6,197
-18%
-22%
KBANK
11,732
12,401
9,355
-20%
-25%
SCB
14,723
13,152
12,845
-13%
-2%
TMB
2,575
1,638
2,046
-21%
25%
KKP
601
664
656
9%
-1%
TCAP
1,235
1,332
1,354
10%
2%
TISCO Total
992 48,427
1,192 47,714
1,198 41,827
21% -14%
0% -12%
Change YoY 29% 34% 78% 30% 337% 132% -12% -18% 38%
(%) QoQ 1% 93% 35% 16% -43% -17% 15% 3% 23%
Source: Banks, KT ZMICO Research
Figure 2: Provision expenses Year-end 31 Dec. BBL KTB KBANK SCB TMB KKP TCAP TISCO Total
Provision (Btmn) 2Q14 1Q15 2Q15E 2,331 2,980 3,000 5,365 3,724 7,200 3,036 4,007 5,400 3,220 3,601 4,192 309 2,387 1,350 327 918 760 2,158 1,647 1,900 1,225 972 1,000 17,971 20,236 24,802
Source: Banks, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 8
Figure 3: Loan growth Year-end 31 Dec. BBL KTB KBANK SCB TMB KKP TCAP TISCO Total
Loan growth (QoQ) 2Q14 1Q15 2Q15E 1.1% -0.4% 0.6% 2.5% 0.1% 1.4% 1.5% 1.4% 1.5% -0.1% 1.8% 0.7% 1.8% 1.6% 1.0% -1.8% -1.9% -1.6% -0.9% -3.3% -1.6% -1.5% -3.2% -1.7% 0.9% 0.8% 0.7%
Loan growth YoY (%) YTD 1.1% 0.1% 9.4% 1.4% 6.8% 2.9% 5.2% 2.6% 6.9% 2.7% -8.1% -3.4% -8.2% -4.8% -10.8% -4.8% 3.6% 1.5%
Source: Banks, KT ZMICO Research
Figure 4: Rating and Valuation Summary Banks
Rating
BBL KTB* KBANK SC B TMB KKP* TC AP TISC O
Outperform Unrated Underperform Underperform Underperform Underperform Underperform Underperform
Sector
Neutral
PER (X) P/BV (X) Target Price 15E (Bt) 2015E 2016E 2015E 2016E 192 9.6 8.8 1.0 0.9 23.50 6.8 6.1 0.9 0.8 210 10.9 9.5 1.5 1.3 165 10.2 9.4 1.6 1.4 2.40 12.8 11.0 1.3 1.2 41.00 7.8 6.5 0.7 0.7 36.00 7.4 6.8 0.8 0.7 46.00 7.6 7.0 1.3 1.1
10.6
9.6
1.2
1.1
ROE (%) 2015E
2016E
10.3 14.1 14.7 16.5 10.8 9.6 10.6 17.5
10.6 14.2 14.9 16.1 11.5 10.8 10.7 17.1
12.2
12.3
Div. yield (%)
2015E 2016E 3.78 3.78 5.72 6.03 2.20 2.48 4.04 4.04 2.63 2.90 6.40 7.64 5.19 5.50 5.39 5.73 4.23
4.59
Source: Bloomberg, KT ZMICO Research * Earnings and target price are under review for possible downgrades.
Figure 5: Sensitivity of bank market prices based on P/BV at different standard deviation levels (SD) Market Price (Bt.)
+2.0SD
8-Jul-15
+1.5SD +1SD +0.5SD
Avg.
-0.5SD -1SD -1.5SD -2.0SD 2013-2015
Price P/BV(x)
High
Low
BAY
32.25
1.34
57
52
47
42
37
32
27
22
17
104
28
BBL
172.0
0.97
271
256
240
224
209
193
178
162
146
237
165 146
181.50
1.51
298
277
256
235
215
194
173
152
131
252
KKP
KBANK
33.00
0.73
62
56
51
45
40
35
29
24
19
71
34
KTB
16.60
0.91
32
29
27
24
21
18
15
12
10
28
15
SC B
131
148.50
1.60
251
236
221
206
192
177
162
147
132
200
TC AP
32.75
0.76
56
51
46
41
36
31
26
21
16
50
30
TISC O
45.25
1.26
74
68
63
57
52
46
40
35
29
61
35
2.28
1.33
3.92
3.57
3.22
2.88
2.53
2.18
1.83
1.48
1.13
3.24
1.87
479.1
1.3
795
741
686
631
577
522
468
413
359
688
428
TMB SETBANK
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 8
Figure 6: Banks’ share price performance & relative performance vs. SETBANK and SET 2013 - 2015
C losed(Bt)
8-Jul-15 High 1,470 1,643 479 688
SET BANK Banking BAY BBL KBANK KKP KTB SC B TC AP TISC O TMB LHBANK
32.25 172.00 181.50 33.00 16.60 148.50 32.75 45.25 2.28 1.79
Price change (%)
Low 1,225 428
104.00 237.00 252.00 71.25 27.75 199.50 50.25 60.75 3.24 2.28
1W 1M 1Q YTD 1Y -2 -3 -2 -2 -2 -4 -8 -20 -19 -18
27.50 165.00 145.50 34.25 15.30 130.50 29.75 34.50 1.87 1.15
-3 -9 -25 -3 -4 -9 -4 -10 -22 -6 -8 -15 -3 -8 -29 -5 -7 -17 -2 -4 -6 -2 -3 -2 -3 -11 -25 -4 7 -5
-28 -11 -21 -16 -28 -19 2 3 -22 14
-31 -13 -16 -28 -26 -17 -8 9 -8 14
Relative to SETBA NK (%)
Relative to SET (%)
2Y High 1W 1M 1Q YTD 1Y 2Y High 1W 1M 2M 1Q YTD 5 -11 -6 -30 -1 -5 -17 -18 -16 -11 -20 -13 -9 4 -34 -12 -5 -11 13 -3 44
-69 -27 -28 -54 -40 -26 -35 -26 -30 -21
-1 -1 -2 -4 -1 -2 1 1 0 -2
-6 -2 -8 -6 -6 -5 -1 -1 -8 9
-23 -6 -20 -13 -27 -15 -3 0 -23 -2
-26 -9 -19 -15 -26 -17 4 5 -21 16
-29 -11 -13 -25 -23 -15 -6 12 -6 16
-18 -14 -1 -39 -17 -9 -16 8 -7 40
-58 -17 -17 -43 -30 -15 -24 -15 -19 -11
1 -1 0 3 0 -3 -3 -1 1 -1 -1 0 2 4 2 4 1 -3 -1 14
-5 -6 5 11 -1 -3 0 4 -6 -10 2 2 6 14 12 17 -1 -6 13 15
Source: Bloomberg, KT ZMICO Research Figure 7: P/BV of SETBANK P/BV (X)
3.6 3.2
Red‐shirt protest Fire at CTW (May‐10)
2.8
+2.0SD = 2.32x +1.5SD = 2.15x +1.0SD = 1.98x +0.5SD = 1.81x
2.4 2.0
Mean = 1.64x
1.6 -0.5SD = 1.47x -1.0SD = 1.30x
EU-US Debt crisis Widespread Flood
Coup
Jun-15
8 Jul 15 = 1.29x
Aug-14
May-12
Aug-11
Nov-10
Feb-10
May-09
Aug-08
Nov-07
Great US recession/Airport Closure
Apr-06
Jul-05
Oct-04
Jan-04
Apr-03
Jan-01
Oct-01
0.4
Jul-02
Military Coup (19 Sept‐06) Yellow‐shirt protest (07)
Jan-07
0.8
Feb-13
-2.0SD = 0.96x
Nov-13
1.2
Source: Banks, KT ZMICO Research Figure 8: SETBANK Index and PER Band (SETBANK Index) 1,000
800
15x 13x
600
11x
9x
400
Coup
7x
EU‐US Debt crisis Widespread Flood
200
Great US recession
-
Jan-15
Jan-14
Jan-13
Jan-12
Jan-11
Jan-10
Jan-09
Jan-08
Jan-07
Jan-06
Jan-05
Jan-04
Jan-03
Jan-02
-200
Source: Bloomberg, KT ZMICO Research REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 4 of 8
1Y
2Y High
-8 -13 -7 9 5 -3 -1 2 10 3 -10 -28 -8 -7 -6 1 1 1 22 10 -5 22 27 19 -3 10 3 34 32 50
-39 3 2 -23 -10 5 -4 5 1 9
Figure 9: Thai bank index vs. regional peers and MSCI Asia (ex Japan) Fin Index 300
MSCI Asia Ex JP FIN Thai Banks Index Indonesian Banks Index Singaporean Banks Index Malaysian Banks Index Hong Kong Banks Index Korean Banks Index Philippine Banks Index
275 250 225 200 175 150 125 100 75
Jan-10 Mar-10 May-10 Jul-10 Sep-10 Dec-10 Feb-11 Apr-11 Jun-11 Aug-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Aug-14 Oct-14 Dec-14 Feb-15 May-15 Jul-15
50
Source: Banks, KT ZMICO Research
Figure 10: Valuation summary vs. regional banks Market Price (Bt.)
+2.0SD
8-Jul-15
+1.5SD +1SD +0.5SD
Avg.
-0.5SD -1SD -1.5SD -2.0SD 2013-2015
Price P/BV(x)
High
Low
BAY
32.25
1.34
57
52
47
42
37
32
27
22
17
104
28
BBL
172.0
0.97
271
256
240
224
209
193
178
162
146
237
165 146
181.50
1.51
298
277
256
235
215
194
173
152
131
252
KKP
KBANK
33.00
0.73
62
56
51
45
40
35
29
24
19
71
34
KTB
16.60
0.91
32
29
27
24
21
18
15
12
10
28
15
SC B
131
148.50
1.60
251
236
221
206
192
177
162
147
132
200
TC AP
32.75
0.76
56
51
46
41
36
31
26
21
16
50
30
TISC O
45.25
1.26
74
68
63
57
52
46
40
35
29
61
35
2.28
1.33
3.92
3.57
3.22
2.88
2.53
2.18
1.83
1.48
1.13
3.24
1.87
479.1
1.3
795
741
686
631
577
522
468
413
359
688
428
TMB SETBANK
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 5 of 8
Figure 11: PBV Band of individual banks and SETBANK BAY’s PBV Band
BBL’s PBV Band
(X)
(X) 1.75
4.0 3.6
+2 S.D. 1.50
3.2
+1 S.D.
2.8 1.25
+2 S.D.
2.4
(X)
1.0 0.8
Source: Bloomberg, KT ZMICO Research
Source: Bloomberg, KT ZMICO Research
KTB’s PBV Band
SCB’s PBV Band
(X) 2.0
Jan-15
Jun-15
Mar-14
Jun-15
Jan-15
Mar-14
Aug-14
Oct-13
May-13
Dec-12
Jul-12
Feb-12
Sep-11
Mar-11
Oct-10
May-10
Dec-09
Jul-09
Feb-09
Nov-07
Jan-07
Jun-15
Jan-15
Mar-14
Aug-14
Oct-13
Dec-12
May-13
Jul-12
Feb-12
Sep-11
Mar-11
Oct-10
May-10
Dec-09
Jul-09
Feb-09
Sep-08
Apr-08
Nov-07
Jan-07
Jun-07
Jun-07
0.2
Sep-08
-2S.D.
0.4
0.6
Avg. -0.5 S.D.
-1 S.D.
0.6
-2 S.D.
1.1
+1 S.D. +0.5 S.D.
1.2
+0.5 S.D. Avg. -0.5 S.D. -1 S.D.
1.6
+2 S.D.
1.4
Apr-08
2.1
+3 S.D.
1.6
+1 S.D.
(X) 3.0
+2 S.D.
1.8
+2 S.D.
+1.5 S.D. +1 S.D.
1.6 1.4
+1.5 S.D. +1.0 S.D. +0.5 S.D. Avg.
2.5
+0.5 S.D. Avg.
1.2
0.6
Aug-14
(X) 1.8 +2 S.D.
0.8
Apr-13
KKP’s PBV Band
3.1
1.0
Sep-13
Nov-12
May-10
Jul-09
Dec-09
Feb-09
Apr-08
Sep-08
Nov-07
Source: Bloomberg, KT ZMICO Research
KBANK’s PBV Band
2.6
Jan-07
Jan-15
Jun-15
Aug-14
Oct-13
Mar-14
May-13
Jul-12
Dec-12
Feb-12
Sep-11
Oct-10
Mar-11
May-10
Jul-09
Dec-09
Feb-09
Apr-08
Sep-08
Nov-07
Jan-07
Jun-07
Source: Bloomberg, KT ZMICO Research
Jun-07
0.50
0.4
Jan-12
-2 S.D. Jun-12
0.8
-2 S.D. 0.75
Aug-11
-0.5 S.D. -1 S.D.
1.00
Oct-10
1.2
-1 S.D.
Mar-11
1.6
-0.5 S.D.
+1 S.D. +0.5 S.D. Avg.
2.0
+0.5 S.D. Avg.
2.0
-0.5 S.D. -1 S.D. -1.5 S.D.
1.5
-2 S.D.
-0.5 S.D. -1 S.D. -1.5 S.D. -2 S.D.
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 6 of 8
Jan-15
Jun-15
Mar-14
Source: Bloomberg, KT ZMICO Research
Aug-14
Oct-13
Dec-12
May-13
Jul-12
Feb-12
Sep-11
Mar-11
Oct-10
May-10
Dec-09
Jul-09
Feb-09
Sep-08
Apr-08
Jan-07
Jun-07
Jun-15
Jan-15
Mar-14
Aug-14
Sep-13
Apr-13
Nov-12
Jan-12
Jun-12
Aug-11
Oct-10
Mar-11
May-10
Jul-09
Dec-09
Feb-09
Sep-08
Jun-07
Nov-07
Jan-07
Apr-08
1.0
0.2
Nov-07
0.4
TCAP’s PBV Band
TISCO’s PBV Band (X)
(X)
2.4
1.6
+2 S.D. 1.4
+2 S.D.
2.0
1.2
+1 S.D.
1.0
+0.5 S.D.
1.6 1.2
-0.5 S.D.
0.8
0.4
Jun-15
Jan-15
Aug-14
Mar-14
Apr-13
Sep-13
Jun-12
Nov-12
Jan-12
Aug-11
Oct-10
Mar-11
Apr-10
Jun-09
Nov-09
Jan-09
Jan-15
Jun-15
Aug-14
Oct-13
Mar-14
May-13
Jul-12
Dec-12
Feb-12
Sep-11
Oct-10
Mar-11
May-10
Jul-09
Dec-09
Feb-09
Apr-08
Sep-08
Nov-07
Jan-07
Jun-07
0.4
Source: Bloomberg, KT ZMICO Research
Source: Bloomberg, KT ZMICO Research
TMB’s PBV Band
SETBANK’s PBV Band P/BV (X)
(X)
3.6 +2 S.D.
3.2
+1.5 S.D. +1 S.D.
2.8
+0.5 S.D. Avg.
2.4
-0.5 S.D.
Red‐shirt protest Fire at CTW (May‐10) +2.0SD = 2.32x +1.5SD = 2.15x +1.0SD = 1.98x +0.5SD = 1.81x
2.0
-1 S.D. -1.5 S.D.
Mean = 1.64x
1.6-0.5SD = 1.47x -1.0SD = 1.30x
EU-US Debt crisis Widespread Flood
Source: Bloomberg, KT ZMICO Research
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 7 of 8
Coup
Jun-15
8 Jul 15 = 1.29x Aug-14
Aug-11
May-12
Feb-10
Aug-08
May-09
Nov-07
Apr-06
Great US recession/Airport Closure Jan-07
Jul-05
Oct-04
Apr-03
Oct-01
Jan-04
Military Coup (19 Sept‐06) Yellow‐shirt protest (07)
0.4 Jan-01
Jun-15
Feb-15
Sep-14
May-14
Dec-13
Jul-13
Mar-13
Oct-12
Jun-12
Jan-12
Sep-11
Apr-11
Jul-10
Feb-10
Oct-09
Jan-09
May-09
0.0
Dec-10
0.8
Feb-13
-2.0SD = 0.96x
Nov-13
1.2
Nov-10
-2 S.D. 0.5
Jul-02
1.0
-2 S.D.
-2 S.D.
0.2
1.5
-0.5 S.D. -1 S.D. -1.5 S.D.
-1 S.D.
0.6
2.0
Avg.
Avg.
0.8
2.5
+1.5 S.D. +1 S.D. +0.5 S.D.
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 8 of 8
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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
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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
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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.
