Buy (17E TP Bt17.50) Company Update
GFPT Buy (17E TP Bt17.50)
Company Update
Close Bt14.80
Agribusiness February 24, 2017
Earning upgrade/Earnings downgrade/Overview unchanged
Earnings to be supported by export markets and low material costs Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
1.327
1.394
KT ZMICO vs. consensus Share data
1.0%
4.0%
Reuters / Bloomberg
GFPT.BK/GFPT TB
Paid‐up Shares (m)
1,253.82
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
19.00/530.00
Foreign limit / actual (%)
49.00/14.47
52 week High / Low (Bt)
16.20/10.70
Avg. daily T/O (shares 000) NVDR (%)
4,494.00 5.89
Estimated free float (%)
44.19
Beta
1.16
URL
www.gfpt.co.th
CGR
Level 2 (Declared)
Anti‐corruption
Phornsri Laysanitsaerekul Analyst , no 17621 [email protected] 66 (0) 2624‐6258
Looking attractive; Buy rating maintained The outlook for the Thai broiler export business in 2017 seems more promising than that of 2016 on more new markets. Meanwhile, raw material prices have remained low while live chicken prices and export prices have increased. These favorable factors should help underpin the profit margin outlook at least throughout 1H17. Our preliminary forecast calls for 1Q17 earnings to grow by 50%YoY. We also expect 2017‐18E earnings to amount to Bt1.7‐1.8bn. Maintain a “Buy” rating and the target price of Bt17.50/share (13x PER), implying 18% upside. Bright outlook for broiler exports with better growth and new markets The Thai Broiler Export Association now expects that Thai broiler export volume may beat the initial expectation of 715,000 tons by 3% (to 743,000 tons). The export volume for 2H16 is expected to accelerate to 70,000 tons/month while the Thai broiler export business in 2017E is expected to grow at least 2.3% to 760,000 tons thanks to higher demand from Japan as well as new markets, e.g., South Korea, Singapore. In addition, a potential market, Saudi Arabia (i.e. the world’s second biggest importer of broilers at 0.85mn tons/year, after Japan who imported broilers at around 0.96mn tons in 2016) is likely to resume imports of raw chicken parts from Thailand in the near future. Good broiler prices and low raw material costs to drive margin The YTD broiler price has averaged at Bt39‐40/kg (+6% from the average of Bt38 in 4Q16 and +10% from the average of Bt37 in 2016). This followed an increase in the day‐old chick price to Bt17.50/chick currently (vs. Bt16.1 in Jan‐17, Bt14.7 in 4Q16 and the 2016 average of Bt13.13). The supply of day‐old chicks remained stable at 33‐34mn chicks/week. Domestic broiler prices are expected to remain high in the next 3‐6 years on growing demand for raising broilers to be prepared for growing export markets. Currently, the export price has risen to US$100‐200/ton. Meanwhile, the raw material (feed) prices have remained low: the corn price stands at Bt8/kg (Bt8.6/kg in 2016) and the soybean meal price is at Bt15.9/kg (vs. Bt17.1/kg in 2016). These favorable factors suggest a positive outlook for operators in 1H17. 1Q17 earnings to grow by 50%YoY but drop by 6%QoQ The earnings normally decline QoQ in 1Q on seasonality; however, the export volume is expected to remain strong (driven especially by growing demand from Japan and Malaysia). Also, raw material prices remain low. Our preliminary forecast calls for the firm’s 1Q17 net profit to amount to Bt413mn (Bt0.33/share), up 50%YoY but down 6%QoQ (on seasonality). 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 17,829 1,780 1.42 1.40 17% 0.40 6.89 2014 10.43 9.36 2.15 2.7% 22.4% 38%
2015 16,467 1,195 0.95 0.95 ‐33% 0.25 7.44 2015 15.53 11.62 1.99 1.7% 13.3% 38%
2016 16,693 1,594 1.27 1.27 33% 0.30 8.50 2016 11.64 9.20 1.74 2.0% 16.0% 33%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 3
2017E 18,296 1,685 1.34 1.34 6% 0.40 9.43 2017E 11.01 9.06 1.57 2.7% 15.0% 27%
2018E 18,914 1,813 1.45 1.45 8% 0.43 10.45 2018E 10.24 8.07 1.42 2.9% 14.5% 19%
PROFIT & LOSS (Btm) Revenues Cost of sales and service Gross profit
2013
2014
2015
2016
2017E
16,692
17,829
16,467
16,693
18,296
2018E 18,914
(14,451)
(15,334)
(14,463)
(14,191)
(15,735)
(16,218)
2,241
2,495
2,003
2,502
2,561
2,695
(1,058)
(1,165)
(1,170)
(1,243)
(1,297)
(1,334)
2,075
2,335
1,903
2,396
2,402
2,607
892
1,005
1,070
1,137
1,137
1,247
EBIT
1,184
1,329
833
1,259
1,264
1,361
Interest expense
(94)
SG&A EBITDA Depreciation & amortization
(186)
(145)
(123)
(98)
(102)
Equity earnings
221
326
249
371
404
444
Other income / exp.
220
224
229
280
323
320
1,439
1,733
1,187
1,813
1,889
2,031
Corporate tax
EBT
(0)
42
20
(206)
(189)
(203)
Minority interests
14
19
18
13
15
15
Extra items
91
23
6
0
0
0
1,516
1,780
1,195
1,594
1,685
1,813
Net profit Reported EPS
1.21
1.42
0.95
1.27
1.34
1.45
Fully diluted EPS
1.21
1.42
0.95
1.27
1.34
1.45
Core net profit
1,813
1,425
1,756
1,189
1,594
1,685
Core EPS
1.21
1.42
0.95
1.27
1.34
1.45
Dividend (Bt)
0.35
0.40
0.25
0.30
0.40
0.43
2013
2014
2015
2016
2017E
2018E
311
270
592
311
190
325
Inventories
3,217
3,274
3,173
3,653
4,051
4,175
Investment
1,991
2,281
2,491
2,809
2,883
2,958
PP&E-net
5,696
6,158
6,749
7,457
7,884
8,219
13,022
13,737
14,976
16,160
17,056
17,792
4,127
1,407
2,070
2,140
2,200
1,800
80
2,167
2,075
1,667
1,200
1,000
5,645
5,004
5,533
5,381
5,092
4,543
88
100
117
121
136
151
7,288
8,633
9,327
10,658
11,828
13,097
13,022
13,737
14,976
16,160
17,057
17,792 2018E
BALANCE SHEET (Btm) Cash and equivalents
Total assets ST debt & current portion Long-term debt Total liabilities Minority interests Shareholder equity Total liab. & shareholder equity CASH FLOW (Btm)
2013
2014
2015
2016
2017E
EBIT
1,184
1,329
833
1,259
1,264
1,361
Depreciation & amortization
(892)
(1,005)
(1,070)
(1,137)
(1,137)
(1,247)
Change in working capital FX, non-cash adjustment & others Cash flow from operations Capex (Invest)/Divest Others
776
107
(67)
(211)
(386)
(124)
2,004
2,082
2,068
2,178
2,307
2,516
3,072
2,513
1,764
2,089
2,048
2,506
(1,446)
(1,496)
(1,626)
(1,145)
(1,565)
(1,582)
154
155
239
(468)
(88)
(91)
Cash flow from investing
(1,292)
(1,340)
(1,386)
(1,613)
(1,653)
(1,673)
Debt financing (repayment)
(584)
(1,522)
(612)
578
(328)
(391)
Equity financing
0
0
0
0
0
0
Dividend payment
0
(439)
(502)
(313)
(376)
(506)
(230)
(163)
(132)
(115)
251
391
(1,752)
(1,214)
(55)
(757)
(516)
(699)
Others Cash flow from financing Net change in cash
28
(41)
322
(281)
(121)
135
1,626
1,018
138
944
483
925
1.30
0.81
0.11
0.75
0.39
0.74
2013
2014
2015
2016
2017E
2018E
8.6
6.8
(7.6)
1.4
9.6
3.4
EBITDA growth (%)
135.3
12.5
(18.5)
25.9
0.2
8.6
EPS growth (%)
554.7
17.4
(32.9)
33.4
5.7
7.6
Gross margin (%)
13.4
14.0
12.2
15.0
14.0
14.3
EBITDA margin (%)
13.8
Free cash flow FCF per share (Bt) PROFITABILITY Revenue growth (%)
12.4
13.1
11.6
14.4
13.1
Operating margin (%)
7.1
7.5
5.1
7.5
6.9
7.2
Net margin (%)
9.1
10.0
7.3
9.5
9.2
9.6
Core profit margin (%) Effective tax rate (%)
8.5
9.9
7.2
9.5
9.2
9.6
(0.0)
2.4
1.6
(11.3)
(10.0)
(10.0)
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 3
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. KT ZMICO is a co underwriter of RPH.
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 Bt14.80
Agribusiness February 24, 2017
Earning upgrade/Earnings downgrade/Overview unchanged
Earnings to be supported by export markets and low material costs Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
1.327
1.394
KT ZMICO vs. consensus Share data
1.0%
4.0%
Reuters / Bloomberg
GFPT.BK/GFPT TB
Paid‐up Shares (m)
1,253.82
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
19.00/530.00
Foreign limit / actual (%)
49.00/14.47
52 week High / Low (Bt)
16.20/10.70
Avg. daily T/O (shares 000) NVDR (%)
4,494.00 5.89
Estimated free float (%)
44.19
Beta
1.16
URL
www.gfpt.co.th
CGR
Level 2 (Declared)
Anti‐corruption
Phornsri Laysanitsaerekul Analyst , no 17621 [email protected] 66 (0) 2624‐6258
Looking attractive; Buy rating maintained The outlook for the Thai broiler export business in 2017 seems more promising than that of 2016 on more new markets. Meanwhile, raw material prices have remained low while live chicken prices and export prices have increased. These favorable factors should help underpin the profit margin outlook at least throughout 1H17. Our preliminary forecast calls for 1Q17 earnings to grow by 50%YoY. We also expect 2017‐18E earnings to amount to Bt1.7‐1.8bn. Maintain a “Buy” rating and the target price of Bt17.50/share (13x PER), implying 18% upside. Bright outlook for broiler exports with better growth and new markets The Thai Broiler Export Association now expects that Thai broiler export volume may beat the initial expectation of 715,000 tons by 3% (to 743,000 tons). The export volume for 2H16 is expected to accelerate to 70,000 tons/month while the Thai broiler export business in 2017E is expected to grow at least 2.3% to 760,000 tons thanks to higher demand from Japan as well as new markets, e.g., South Korea, Singapore. In addition, a potential market, Saudi Arabia (i.e. the world’s second biggest importer of broilers at 0.85mn tons/year, after Japan who imported broilers at around 0.96mn tons in 2016) is likely to resume imports of raw chicken parts from Thailand in the near future. Good broiler prices and low raw material costs to drive margin The YTD broiler price has averaged at Bt39‐40/kg (+6% from the average of Bt38 in 4Q16 and +10% from the average of Bt37 in 2016). This followed an increase in the day‐old chick price to Bt17.50/chick currently (vs. Bt16.1 in Jan‐17, Bt14.7 in 4Q16 and the 2016 average of Bt13.13). The supply of day‐old chicks remained stable at 33‐34mn chicks/week. Domestic broiler prices are expected to remain high in the next 3‐6 years on growing demand for raising broilers to be prepared for growing export markets. Currently, the export price has risen to US$100‐200/ton. Meanwhile, the raw material (feed) prices have remained low: the corn price stands at Bt8/kg (Bt8.6/kg in 2016) and the soybean meal price is at Bt15.9/kg (vs. Bt17.1/kg in 2016). These favorable factors suggest a positive outlook for operators in 1H17. 1Q17 earnings to grow by 50%YoY but drop by 6%QoQ The earnings normally decline QoQ in 1Q on seasonality; however, the export volume is expected to remain strong (driven especially by growing demand from Japan and Malaysia). Also, raw material prices remain low. Our preliminary forecast calls for the firm’s 1Q17 net profit to amount to Bt413mn (Bt0.33/share), up 50%YoY but down 6%QoQ (on seasonality). 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 17,829 1,780 1.42 1.40 17% 0.40 6.89 2014 10.43 9.36 2.15 2.7% 22.4% 38%
2015 16,467 1,195 0.95 0.95 ‐33% 0.25 7.44 2015 15.53 11.62 1.99 1.7% 13.3% 38%
2016 16,693 1,594 1.27 1.27 33% 0.30 8.50 2016 11.64 9.20 1.74 2.0% 16.0% 33%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 3
2017E 18,296 1,685 1.34 1.34 6% 0.40 9.43 2017E 11.01 9.06 1.57 2.7% 15.0% 27%
2018E 18,914 1,813 1.45 1.45 8% 0.43 10.45 2018E 10.24 8.07 1.42 2.9% 14.5% 19%
PROFIT & LOSS (Btm) Revenues Cost of sales and service Gross profit
2013
2014
2015
2016
2017E
16,692
17,829
16,467
16,693
18,296
2018E 18,914
(14,451)
(15,334)
(14,463)
(14,191)
(15,735)
(16,218)
2,241
2,495
2,003
2,502
2,561
2,695
(1,058)
(1,165)
(1,170)
(1,243)
(1,297)
(1,334)
2,075
2,335
1,903
2,396
2,402
2,607
892
1,005
1,070
1,137
1,137
1,247
EBIT
1,184
1,329
833
1,259
1,264
1,361
Interest expense
(94)
SG&A EBITDA Depreciation & amortization
(186)
(145)
(123)
(98)
(102)
Equity earnings
221
326
249
371
404
444
Other income / exp.
220
224
229
280
323
320
1,439
1,733
1,187
1,813
1,889
2,031
Corporate tax
EBT
(0)
42
20
(206)
(189)
(203)
Minority interests
14
19
18
13
15
15
Extra items
91
23
6
0
0
0
1,516
1,780
1,195
1,594
1,685
1,813
Net profit Reported EPS
1.21
1.42
0.95
1.27
1.34
1.45
Fully diluted EPS
1.21
1.42
0.95
1.27
1.34
1.45
Core net profit
1,813
1,425
1,756
1,189
1,594
1,685
Core EPS
1.21
1.42
0.95
1.27
1.34
1.45
Dividend (Bt)
0.35
0.40
0.25
0.30
0.40
0.43
2013
2014
2015
2016
2017E
2018E
311
270
592
311
190
325
Inventories
3,217
3,274
3,173
3,653
4,051
4,175
Investment
1,991
2,281
2,491
2,809
2,883
2,958
PP&E-net
5,696
6,158
6,749
7,457
7,884
8,219
13,022
13,737
14,976
16,160
17,056
17,792
4,127
1,407
2,070
2,140
2,200
1,800
80
2,167
2,075
1,667
1,200
1,000
5,645
5,004
5,533
5,381
5,092
4,543
88
100
117
121
136
151
7,288
8,633
9,327
10,658
11,828
13,097
13,022
13,737
14,976
16,160
17,057
17,792 2018E
BALANCE SHEET (Btm) Cash and equivalents
Total assets ST debt & current portion Long-term debt Total liabilities Minority interests Shareholder equity Total liab. & shareholder equity CASH FLOW (Btm)
2013
2014
2015
2016
2017E
EBIT
1,184
1,329
833
1,259
1,264
1,361
Depreciation & amortization
(892)
(1,005)
(1,070)
(1,137)
(1,137)
(1,247)
Change in working capital FX, non-cash adjustment & others Cash flow from operations Capex (Invest)/Divest Others
776
107
(67)
(211)
(386)
(124)
2,004
2,082
2,068
2,178
2,307
2,516
3,072
2,513
1,764
2,089
2,048
2,506
(1,446)
(1,496)
(1,626)
(1,145)
(1,565)
(1,582)
154
155
239
(468)
(88)
(91)
Cash flow from investing
(1,292)
(1,340)
(1,386)
(1,613)
(1,653)
(1,673)
Debt financing (repayment)
(584)
(1,522)
(612)
578
(328)
(391)
Equity financing
0
0
0
0
0
0
Dividend payment
0
(439)
(502)
(313)
(376)
(506)
(230)
(163)
(132)
(115)
251
391
(1,752)
(1,214)
(55)
(757)
(516)
(699)
Others Cash flow from financing Net change in cash
28
(41)
322
(281)
(121)
135
1,626
1,018
138
944
483
925
1.30
0.81
0.11
0.75
0.39
0.74
2013
2014
2015
2016
2017E
2018E
8.6
6.8
(7.6)
1.4
9.6
3.4
EBITDA growth (%)
135.3
12.5
(18.5)
25.9
0.2
8.6
EPS growth (%)
554.7
17.4
(32.9)
33.4
5.7
7.6
Gross margin (%)
13.4
14.0
12.2
15.0
14.0
14.3
EBITDA margin (%)
13.8
Free cash flow FCF per share (Bt) PROFITABILITY Revenue growth (%)
12.4
13.1
11.6
14.4
13.1
Operating margin (%)
7.1
7.5
5.1
7.5
6.9
7.2
Net margin (%)
9.1
10.0
7.3
9.5
9.2
9.6
Core profit margin (%) Effective tax rate (%)
8.5
9.9
7.2
9.5
9.2
9.6
(0.0)
2.4
1.6
(11.3)
(10.0)
(10.0)
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 3
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. KT ZMICO is a co underwriter of RPH.
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
