Industry Update - Global Alliance Partners
Industry Update June 25, 2014
Banking
Neutral
May-14 stats remain weak; recovery likely in 2H14E We maintain our Neutral stance for the sector as current valuations post limited upside potential vs. the 2014E target prices. However, we see the chance of an earnings upgrade, especially for 2015E and for large banks, on the likelihood of an improving macro front and the easing political environment. In regard to this and the appealing upside potential vs. the 2015E target prices (likely to offer 15% (+/-) additional upside potential), we see potential near-term price weakness from dull 2Q14E earnings creating an opportunity to accumulate banking stocks (especially for large banks) for L-T investment. May-14 loans quite flat MoM: The segment that showed some growth MoM was corporate and SME loans. KTB showed the strongest growth (+1.8% MoM), backed mainly by lending to the government, corporate and retail segments. This was followed by TMB (+1.6%) and KBANK (+0.8%), driven mainly by SME loans. Meanwhile, banks with high exposure to auto loans (especially TISCO, KKP and TCAP) have continued to see a loan decline MoM since the beginning of the year, especially in the used car segment. BAY’s large loan drop MoM was due to loan repayments from its subsidiary and corporate clients.
Share data SET index
1,460.92
Sector index
550.55
52-week high
567.67
52-week low
427.61
Market capitalization (Bt m)
2,248,050.77
% of market cap
17.13
Avg daily turnover (m shares)
353.29
Beta
1.13
Sector Performance (%) 1M
3M
12M
Absolute
8.87
11.41
0.89
Relative
3.45
3.75
1.09
See chance of higher-than-expected loan growth for 15E: Loans for 5M14 grew just 1% YTD. However, we see a chance that loan growth for FY14 could be near our forecast of +6% as we expect loan growth to improve from 3Q14 on the resumption of fiscal stimulus and improving consumption amid the easing political environment. Moreover, we see a high chance that loan growth for 2015E could surpass our forecast of just 8%. 2Q14E earnings outlooks still dull: The prolonged political tension during 1H14E will still depress banks’ 2Q14 earnings, with the likelihood of flat or weakening earnings on both a YoY and QoQ basis. Banks with high exposure to retail and auto loans (especially KKP, TCAP and TISCO) should see a higher net profit (NP) drop. Meanwhile, larger banks’ earnings should be more resilient. In particular, KTB and TMB are likely to show higher NP growth YoY due to the low base effect in 2Q13. Meanwhile, TCAP should show a sharp NP drop YoY due to the high base NP effect in 2Q13 that arose from the booking of huge gain from the sale of Thanachart Life. Possible earnings upgrade for 2014-15E: We expect banks’ earnings to bottom out in 1H14E, improve modestly in 2H14E, and recover visibly in 2015E on the improving macro front and better confidence. Therefore, we see the chance of an earnings upgrade in 2014-15E, especially for 2015E and for large banks (particularly for KBANK, SCB and KTB) with higher exposure to a non-interest income base as well as for KKP on the likelihood of better capital market related income.
Note:
KT•ZMICO
is
a
partnership
between KTB and ZMICO
Prapharas Nonthapiboon Analyst, no 17836 [email protected] 66 (0) 2695-5872
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 1 of 7
Rating and Valuation Summary Figure 1: Rating and Valuation Summary
Rating
Banks
Target Price 14E (Bt)
2014E
2015E
2014E
2015E
2014E
2015E
PER (X)
P/BV (X)
ROE (%)
Div. yield (%) 2014E 2015E
BBL
BUY
220
9.60
8.61
1.16
1.06
12.5
12.9
3.40
3.66
KTB
Unrated
22.00
8.40
7.41
1.26
1.13
15.8
16.1
4.52
5.06
KBANK
Trading Buy
205
11.33
10.18
1.90
1.65
18.0
17.4
1.73
1.87
SC B
Trading Buy
170
10.94
10.12
1.98
1.75
19.4
18.4
3.31
3.46
TMB
Trading Buy
2.30
13.97
10.71
1.54
1.39
11.5
13.6
2.36
3.08
BAY
Sell into Strength
32.00
16.96
14.76
1.97
1.80
12.1
12.7
1.77
2.03
KKP
Sell into Strength
41.00
10.41
7.31
1.03
0.95
10.1
13.5
5.81
6.26 4.57
TC AP
Sell into Strength
36.00
7.08
6.66
0.82
0.75
12.4
11.8
4.57
Sell into Strength Sector Neutral
41.00
8.15
6.84
1.31
1.16
16.9
18.0
4.91
5.41
10.72
9.54
1.56
1.40
15.3
15.4
3.48
3.54
TISC O
Source: Company data, KT ZMICO Research
Figure 2: Banks’ share price performance & relative performance vs. SETBANK and SET
C losed(Bt) SET BANK Banking BAY BBL KBANK KKP KTB SC B TC AP TISCO TMB LHBANK
2013 - 2014
24-Jun-14 High 1,461 1,643 551 622 43.25 191.00 202.00 44.75 20.70 166.00 35.00 41.50 2.38 1.58
45.25 237.00 225.00 71.25 27.75 199.50 50.25 60.75 3.08 1.89
Price change (%)
Low 1,225 428 27.50 165.00 145.50 34.25 15.30 130.50 29.75 34.50 1.87 1.15
1M 1Q YTD 5 7 12 8 13 21 14 4 7 12 14 5 4 8 7 0
26 9 18 6 13 9 -3 3 1 32
1Y 7 12
42 24 7 4 29 18 20 -11 25 16 16 9 9 -3 8 -1 16 12 23 23
52 6 27 30 43 17 22 17 56 24
Relative to SETBA NK (%)
Relative to SET (%)
2Y High 1M 1Q YTD 27 -11 24 -11 3 6 8 -4 -19 -10 -37 -25 -17 -30 -32 -23 -16
9 19 -1 2 2 11 7 -1 10 6 1 2 0 -11 3 -4 3 -6 -5 25
2Y High 1M 2M 1Q YTD 1Y 2Y High
1Y 5
-3
0
29 17 25 -5 -3 -21 17 11 0 8 -18 3 13 9 16 3 2 -10 -4 -11 -5 -5 -8 -10 3 5 29 11 16 -2
7 -8 1 -26 -14 -6 -19 -21 -12 -5
6 -4 -1 4 7 -2 -3 0 0 -8
12 14 21 13 28 -5 -4 -13 -8 -19 0 6 9 7 3 -4 -7 0 -23 6 8 0 5 4 19 -4 -4 -5 -3 -7 -1 -16 -12 -15 -2 -5 -10 -13 -13 -7 -1 -12 -5 0 31 -2 19 3 11 0
7 -8 1 -26 -14 -5 -19 -20 -11 -5
Source: Bloomberg, KT ZMICO Research
Figure 3: Key ratios of Thai banks vs. regional banks
NP growth(%)
PER (X)
P/BV (X)
2013
2014E
2013
2014E
2013 2014E
C hina Hong Kong India Indonesia Korea Malaysia
12 6 14 14 -31 7
8 10 -5 14 16 8
6.2 12.7 15.9 11.8 10.3 13.1
5.7 10.8 16.5 10.6 8.7 12.3
0.9 1.3 2.3 2.2 0.6 1.8
Philippines
31
-4
13.4
14.1
Singapore Thailand Regional Avg.
3 25 9
9 2 7
13.8 11.0 12.0
12.5 10.7 11.3
Dividend yield (%)
ROE (%)
2013
2014E
2013
2014E
0.8 1.2 1.9 1.9 0.6 1.6
5.3 3.9 2.2 2.1 1.7 3.4
6.0 7.9 2.4 2.4 2.1 3.6
16.8 11.7 14.9 19.4 6.0 15.0
16.2 14.0 15.4 18.4 6.6 14.5
1.8
1.7
1.8
1.8
15.1
13.4
1.2 1.7 1.5
1.1 1.6 1.4
3.6 3.3 3.0
3.7 3.5 3.7
9.4 16.8 13.9
9.7 15.3 13.7
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 2 of 7
Figure 4: P/BV of SETBANK vs. SET P/BV (X)
3.6
‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
SET P/BV
____ SETBANK P/BV
3.2
Red‐shirt protest Fire at CTW (May‐10)
2.8 +2.0SD = 2.34x
2.4
+1.0SD = 1.99x
2.0
+0.5SD = 1.81x
Mean = 1.64x 1.6 -0.5SD = 1.46x -1.0SD = 1.29x -2.0SD = 0.93x
1.2 0.8
EU-US Debt crisis Widespread Flood
Military Coup (19 Sept‐06) Yellow‐shirt protest (07)
Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14
0.4
24 Jun 14 = 1.67x Great US recession/Airport Closure
Source: Banks, KT ZMICO Research
Figure 5: Banks’ loans vs. growth Bank only
Change MoM (Btmn)
Loans (Btmn)
Change MoM (%)
Change
Change YTD
Banks' Targets
KTZ (%) 14E 15E
basis
May 14
Mar 14
A pr 14
May 14
Mar 14
A pr 14
May 14
YoY (%)
5M14 (%)
14E (%)
BBL
1 ,7 0 1 ,7 2 3
(5 ,2 0 7 )
1 ,7 2 2
1 ,3 7 9
-0 .3 %
0 .1 %
0 .1 %
8 .4 %
-0 .3 %
3 -5 (from 5 -7 )+
6
8
KTB
1 ,7 9 7 ,9 7 7
2 2 ,1 5 5
2 ,2 6 5
3 1 ,8 3 1
1 .3 %
0 .1 %
1 .8 %
1 0 .6 %
4 .7 %
5 -7
8
9
KBANK
1 ,4 5 8 ,5 6 1
SCB
1 ,7 1 8 ,0 0 9
1 6 ,7 4 8
(8 ,8 7 3 )
TMB
5 1 2 ,3 9 9
(2 ,6 2 1 )
BA Y
8 1 5 ,6 6 4
2 5 ,3 1 2
TCA P* TISCO* KKP
7 8 5 ,2 6 9 2 8 0 ,4 8 9 1 9 5 ,8 9 1
Total
9,265,982
(1 0 ,7 8 8 ) 1 1 ,9 7 9
1 0 ,9 0 4
-0 .7 %
0 .8 %
0 .8 %
6 .9 %
2 .4 %
7 -8
7
8
(1 ,2 7 6 )
1 .0 %
-0 .5 %
-0 .1 %
6 .4 %
-0 .6 %
5 -7
5
7
5 ,0 5 8
8 ,1 4 7
-0 .5 %
1 .0 %
1 .6 %
1 2 .8 %
2 .9 %
6 -8
7
10
1 ,2 0 2
(1 0 ,5 9 3 )
3 .2 %
0 .1 %
-1 .3 %
1 1 .2 %
-0 .8 %
~9
5
9
(7 5 6 ) (1 ,4 2 9 ) 6 ,5 2 4
(4 ,5 5 1 ) (1 ,4 9 4 ) (1 ,6 6 9 )
(1 ,4 2 7 ) (2 ,6 8 5 ) (1 ,5 1 4 )
-0 .1 % -0 .5 % 3 .4 %
-0 .6 % -0 .5 % -0 .8 %
-0 .2 % -0 .9 % -0 .8 %
0 .9 % 1 .7 % 7 .9 %
-0 .8 % -4 .0 % 2 .0 %
6 -7 8 -9 9**
5 2 7
6 13 13
49,938
5,638
34,766
0.54%
0.1%
0.4%
7.8%
1.0%
6
8
Source: Banks, KT ZMICO Research * Consolidated basis ** Including new large corporate banking loans (~Bt6bn). + Excluding loans for M&A purpose.
Figure 6: Banks’ deposits vs. growth Bank only
Change
YTD Change
basis
Deposits (Btmn) May 14
Mar 14
Change MoM (Btmn) A pr 14
May 14
Mar 14
Change MoM (%) A pr 14
May 14
YoY (%)
5M14 (%)
BBL
1 ,8 5 2 ,9 1 3
(3 6 ,9 1 2 )
(1 1 ,5 1 2 )
(1 ,7 3 4 )
-1 .9 %
-0 .6 %
-0 .1 %
4 .2 %
-1 .0 %
KTB
1 ,8 8 4 ,6 1 6
3 8 ,6 2 2
(2 1 ,0 0 2 )
(5 8 ,1 1 0 )
2 .0 %
-1 .1 %
-3 .0 %
8 .8 %
0 .0 %
KBA NK
1 ,5 5 4 ,2 4 0
(3 5 ,3 5 4 )
1 8 ,5 9 6
(2 0 ,5 9 5 )
-2 .2 %
1 .2 %
-1 .3 %
6 .8 %
1 .4 %
SCB
1 ,7 3 4 ,6 2 5
1 3 ,3 3 9
(5 6 ,9 1 1 )
3 ,8 3 5
0 .8 %
-3 .2 %
0 .2 %
-0 .2 %
-4 .7 %
TMB
5 7 4 ,2 7 3
6 ,7 2 7
1 3 ,0 2 3
2 ,5 0 4
1 .2 %
2 .3 %
0 .4 %
1 7 .4 %
8 .4 %
BA Y
7 7 6 ,3 7 6
(1 4 ,7 3 3 )
(9 ,5 6 2 )
2 ,5 0 8
-1 .8 %
-1 .2 %
0 .3 %
5 .6 %
1 .0 %
TCA P*
7 0 4 ,9 1 7
(3 0 ,1 1 1 )
4 ,9 9 3
2 3 ,6 4 4
-4 .3 %
0 .7 %
3 .5 %
1 .8 %
-1 .5 %
TISCO*
2 3 4 ,3 8 8
(1 9 ,4 4 1 )
2 ,1 4 2
4 ,6 3 5
-7 .9 %
0 .9 %
2 .0 %
-0 .1 %
-1 1 .4 %
KKP
1 5 1 ,7 1 4
(1 ,8 9 1 )
2 ,6 0 9
3 ,9 1 2
-1 .3 %
1 .8 %
2 .6 %
-4 .1 %
3 .8 %
Total
9,468,063
(79,753)
(57,624)
(39,400)
-0.8%
-0.6%
-0.4%
5.0%
-0.7%
Source: Banks, KT ZMICO Research * Consolidated basis
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 3 of 7
Figure 7: Thai banks’ loan growth on a YoY basis 20%
Figure 8: Thai banks’ loan & deposit growth on MoM basis 5%
Avg. growth 2008-YTD = 10.2% YoY
4% 15%
3% 2%
10%
0%
5%
-1%
-3% Loan Growth MoM
Source: Banks, KT ZMICO Research
Source: Banks, KT ZMICO Research
Figure 9: Thai banks’ loan-to-deposit and loan-to-
Figure 10: Ratios of loan-to-deposit and loan-todeposit and borrowing as of May-14
98 91
BAY
129
120
111
TMB
100
KTB KBANK SCB
102
BBL
98
100
105
100
Loan to Deposit + Borrowing ratio
92
120
Loan to deposit ratio
89 84
105
Loan to deposit+borrowings
99 92
(%) 140
Loan to deposit
94 90
110
95 90
deposit and borrowing ratios (%)
Deposit Growth MoM
-4%
92 85
-5%
-2% Dec.07 Mar.08 Jun.08 Sept.08 Dec.08 Mar.09 Jun.09 Sept.09 Dec.09 Mar.10 Jun. 10 Sept. 10 Dec.10 Mar.11 Jun.11 Sept.11 Dec.11 Mar.12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13 Sep 13 Dec 13 Mar 14
0%
Dec.08 Mar.09 Jun.09 Sept.09 Dec.09 Mar.10 Jun. 10 Sept. 10 Dec.10 Mar.11 Jun.11 Sept.11 Dec.11 Mar.12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13 Sep 13 Dec 13 Mar 14
1%
80
95
60
90
40 85
Mar 14
Dec 13
Jun 13
Sep 13
Mar 13
Dec 12
Sep 12
Mar.12
Jun 12
Dec.11
Sept.11
Mar.11
Jun.11
Dec.10
Sept. 10
Mar.10
Jun. 10
Dec.09
Jun.09
Sept.09
Mar.09
Dec.08
20 80
Source: Banks, KT ZMICO Research
0 TCAP TISCO KKP Sector
Source: Banks, KT ZMICO Research
Figure 11: Net excess liquidity in the money market to
Figure 12: Capital adequacy ratios as of May-14
total assets as of May-14 (%)
(%) 18
14 12
10.8
5.7
5.0 3.9
4
3.6
3.1
KTB
TMB
SCB
KKP TISCO BAY KBANK TCAP Sector
-2
Source: Banks, KT ZMICO Research
15.0
15.0 14.4 13.8
13.6
13.4
12
2.9 1.6
2 BBL
15.9 15.6
14
7.1
6
0
16.0
16
10 8
17.2
10 8 BBL
SCB
TMB KBANK TISCO BAY
KKP
KTB
TCAP Sector
Source: Banks, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 4 of 7
Figure 13: PBV Band of individual bank and SETBANK BAY’s PBV Band (X)
BBL’s PBV Band (X)
2.3
+2 S.D.
1.75 +2 S.D.
+1 S.D. 1.7
+0.5 S.D. Avg.
1.4
1.50
1.25
-0.5 S.D. -1 S.D.
1.1
-2 S.D.
0.8
1.00
-2 S.D.
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
Source: Bloomberg, KT ZMICO Research KBANK’s PBV Band (X)
+0.5 S.D. Avg. -0.5 S.D. -1 S.D. -2 S.D.
1.1
0.8
0.6
-2S.D. Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
Source: Bloomberg, KT ZMICO Research SCB’s PBV Band 3.0 +2 S.D.
+2 S.D. +1 S.D. +0.5 S.D.
1.2
0.8
-0.5 S.D. -1 S.D.
0.6
(X)
(X) 2.0
1.0
+0.5 S.D. Avg.
1.0
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
KTB’s PBV Band
1.4
+1 S.D.
1.2
0.2
Source: Bloomberg, KT ZMICO Research
1.6
+2 S.D.
0.4
0.6
1.8
+3 S.D.
1.4
+1 S.D.
1.6
KKP’s PBV Band
1.6
+2 S.D.
2.1
Source: Bloomberg, KT ZMICO Research
(X) 1.8
3.1 2.6
-0.5 S.D. -1 S.D.
0.75
0.50
0.5
+1 S.D. +0.5 S.D. Avg.
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
2.0
2.5
+1 S.D. +0.5 S.D. Avg.
Avg. -0.5 S.D.
2.0
-1 S.D. -2 S.D.
0.4
-0.5 S.D. -1 S.D.
1.5 -2 S.D.
1.0
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
0.0
Source: Bloomberg, KT ZMICO Research
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
0.2
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 5 of 7
TCAP’s PBV Band
TISCO’s PBV Band (X)
(X)
2.4
1.6
+2 S.D.
1.4
+2 S.D.
1.2
+1 S.D.
1.0
+0.5 S.D.
2.0
0.8
1.2
-0.5 S.D.
Avg. -0.5 S.D. -1 S.D.
-1 S.D.
0.6
-2 S.D.
0.8
0.4
Source: Bloomberg, KT ZMICO Research
Jan-14
May-14
Sep-13
Jan-13
May-13
Sep-12
Jan-12
May-12
Sep-11
Jan-11
May-11
Source: Bloomberg, KT ZMICO Research
TMB’s PBV Band
SETBANK’s PBV Band P/BV (X)
(X)
3.6
3.0
‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
2.5
+2 S.D.
2.0
+1 S.D.
1.5
+0.5 Avg.
2.0
1.0
-0.5 S.D. -1 S.D.
1.6
2.8
0.4
+0.5SD = 1.81x
-0.5SD = 1.46x -1.0SD = 1.29x -2.0SD = 0.93x
Military Coup (19 Sept‐06) Yellow‐shirt protest (07)
EU-US Debt crisis Widespread Flood
24 Jun 14 = 1.67x Great US recession/Airport Closure
Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14
Jan-14
May-14
Sep-13
Jan-13
Source: Bloomberg, KT ZMICO Research
May-13
Sep-12
Jan-12
May-12
Sep-11
May-11
Jan-11
Sep-10
Jan-10
May-10
Jan-09
Sep-09
0.8
May-09
+1.0SD = 1.99x
Mean = 1.64x 1.2
Red‐shirt protest Fire at CTW (May‐10)
+2.0SD = 2.34x
2.4
-2 S.D.
0.0
SET P/BV
____ SETBANK P/BV
3.2
0.5
Sep-10
Jan-10
May-10
Jan-09
May-09
0.4
Sep-09
-2 S.D.
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
0.2
1.6 Avg.
+1 S.D. +0.5 S.D.
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 6 of 7
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 TRADING BUY: Expecting positive total returns of 10% or more over the next 3 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.
SELL INTO STRENGTH: Expecting total returns between -10% to +10% over the next 12 month; share price has largely priced in fundamentals
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.
SELL: Expecting negative total returns of 10% or more 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 7 of 7
th
th
th
th
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.
Banking
Neutral
May-14 stats remain weak; recovery likely in 2H14E We maintain our Neutral stance for the sector as current valuations post limited upside potential vs. the 2014E target prices. However, we see the chance of an earnings upgrade, especially for 2015E and for large banks, on the likelihood of an improving macro front and the easing political environment. In regard to this and the appealing upside potential vs. the 2015E target prices (likely to offer 15% (+/-) additional upside potential), we see potential near-term price weakness from dull 2Q14E earnings creating an opportunity to accumulate banking stocks (especially for large banks) for L-T investment. May-14 loans quite flat MoM: The segment that showed some growth MoM was corporate and SME loans. KTB showed the strongest growth (+1.8% MoM), backed mainly by lending to the government, corporate and retail segments. This was followed by TMB (+1.6%) and KBANK (+0.8%), driven mainly by SME loans. Meanwhile, banks with high exposure to auto loans (especially TISCO, KKP and TCAP) have continued to see a loan decline MoM since the beginning of the year, especially in the used car segment. BAY’s large loan drop MoM was due to loan repayments from its subsidiary and corporate clients.
Share data SET index
1,460.92
Sector index
550.55
52-week high
567.67
52-week low
427.61
Market capitalization (Bt m)
2,248,050.77
% of market cap
17.13
Avg daily turnover (m shares)
353.29
Beta
1.13
Sector Performance (%) 1M
3M
12M
Absolute
8.87
11.41
0.89
Relative
3.45
3.75
1.09
See chance of higher-than-expected loan growth for 15E: Loans for 5M14 grew just 1% YTD. However, we see a chance that loan growth for FY14 could be near our forecast of +6% as we expect loan growth to improve from 3Q14 on the resumption of fiscal stimulus and improving consumption amid the easing political environment. Moreover, we see a high chance that loan growth for 2015E could surpass our forecast of just 8%. 2Q14E earnings outlooks still dull: The prolonged political tension during 1H14E will still depress banks’ 2Q14 earnings, with the likelihood of flat or weakening earnings on both a YoY and QoQ basis. Banks with high exposure to retail and auto loans (especially KKP, TCAP and TISCO) should see a higher net profit (NP) drop. Meanwhile, larger banks’ earnings should be more resilient. In particular, KTB and TMB are likely to show higher NP growth YoY due to the low base effect in 2Q13. Meanwhile, TCAP should show a sharp NP drop YoY due to the high base NP effect in 2Q13 that arose from the booking of huge gain from the sale of Thanachart Life. Possible earnings upgrade for 2014-15E: We expect banks’ earnings to bottom out in 1H14E, improve modestly in 2H14E, and recover visibly in 2015E on the improving macro front and better confidence. Therefore, we see the chance of an earnings upgrade in 2014-15E, especially for 2015E and for large banks (particularly for KBANK, SCB and KTB) with higher exposure to a non-interest income base as well as for KKP on the likelihood of better capital market related income.
Note:
KT•ZMICO
is
a
partnership
between KTB and ZMICO
Prapharas Nonthapiboon Analyst, no 17836 [email protected] 66 (0) 2695-5872
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 1 of 7
Rating and Valuation Summary Figure 1: Rating and Valuation Summary
Rating
Banks
Target Price 14E (Bt)
2014E
2015E
2014E
2015E
2014E
2015E
PER (X)
P/BV (X)
ROE (%)
Div. yield (%) 2014E 2015E
BBL
BUY
220
9.60
8.61
1.16
1.06
12.5
12.9
3.40
3.66
KTB
Unrated
22.00
8.40
7.41
1.26
1.13
15.8
16.1
4.52
5.06
KBANK
Trading Buy
205
11.33
10.18
1.90
1.65
18.0
17.4
1.73
1.87
SC B
Trading Buy
170
10.94
10.12
1.98
1.75
19.4
18.4
3.31
3.46
TMB
Trading Buy
2.30
13.97
10.71
1.54
1.39
11.5
13.6
2.36
3.08
BAY
Sell into Strength
32.00
16.96
14.76
1.97
1.80
12.1
12.7
1.77
2.03
KKP
Sell into Strength
41.00
10.41
7.31
1.03
0.95
10.1
13.5
5.81
6.26 4.57
TC AP
Sell into Strength
36.00
7.08
6.66
0.82
0.75
12.4
11.8
4.57
Sell into Strength Sector Neutral
41.00
8.15
6.84
1.31
1.16
16.9
18.0
4.91
5.41
10.72
9.54
1.56
1.40
15.3
15.4
3.48
3.54
TISC O
Source: Company data, KT ZMICO Research
Figure 2: Banks’ share price performance & relative performance vs. SETBANK and SET
C losed(Bt) SET BANK Banking BAY BBL KBANK KKP KTB SC B TC AP TISCO TMB LHBANK
2013 - 2014
24-Jun-14 High 1,461 1,643 551 622 43.25 191.00 202.00 44.75 20.70 166.00 35.00 41.50 2.38 1.58
45.25 237.00 225.00 71.25 27.75 199.50 50.25 60.75 3.08 1.89
Price change (%)
Low 1,225 428 27.50 165.00 145.50 34.25 15.30 130.50 29.75 34.50 1.87 1.15
1M 1Q YTD 5 7 12 8 13 21 14 4 7 12 14 5 4 8 7 0
26 9 18 6 13 9 -3 3 1 32
1Y 7 12
42 24 7 4 29 18 20 -11 25 16 16 9 9 -3 8 -1 16 12 23 23
52 6 27 30 43 17 22 17 56 24
Relative to SETBA NK (%)
Relative to SET (%)
2Y High 1M 1Q YTD 27 -11 24 -11 3 6 8 -4 -19 -10 -37 -25 -17 -30 -32 -23 -16
9 19 -1 2 2 11 7 -1 10 6 1 2 0 -11 3 -4 3 -6 -5 25
2Y High 1M 2M 1Q YTD 1Y 2Y High
1Y 5
-3
0
29 17 25 -5 -3 -21 17 11 0 8 -18 3 13 9 16 3 2 -10 -4 -11 -5 -5 -8 -10 3 5 29 11 16 -2
7 -8 1 -26 -14 -6 -19 -21 -12 -5
6 -4 -1 4 7 -2 -3 0 0 -8
12 14 21 13 28 -5 -4 -13 -8 -19 0 6 9 7 3 -4 -7 0 -23 6 8 0 5 4 19 -4 -4 -5 -3 -7 -1 -16 -12 -15 -2 -5 -10 -13 -13 -7 -1 -12 -5 0 31 -2 19 3 11 0
7 -8 1 -26 -14 -5 -19 -20 -11 -5
Source: Bloomberg, KT ZMICO Research
Figure 3: Key ratios of Thai banks vs. regional banks
NP growth(%)
PER (X)
P/BV (X)
2013
2014E
2013
2014E
2013 2014E
C hina Hong Kong India Indonesia Korea Malaysia
12 6 14 14 -31 7
8 10 -5 14 16 8
6.2 12.7 15.9 11.8 10.3 13.1
5.7 10.8 16.5 10.6 8.7 12.3
0.9 1.3 2.3 2.2 0.6 1.8
Philippines
31
-4
13.4
14.1
Singapore Thailand Regional Avg.
3 25 9
9 2 7
13.8 11.0 12.0
12.5 10.7 11.3
Dividend yield (%)
ROE (%)
2013
2014E
2013
2014E
0.8 1.2 1.9 1.9 0.6 1.6
5.3 3.9 2.2 2.1 1.7 3.4
6.0 7.9 2.4 2.4 2.1 3.6
16.8 11.7 14.9 19.4 6.0 15.0
16.2 14.0 15.4 18.4 6.6 14.5
1.8
1.7
1.8
1.8
15.1
13.4
1.2 1.7 1.5
1.1 1.6 1.4
3.6 3.3 3.0
3.7 3.5 3.7
9.4 16.8 13.9
9.7 15.3 13.7
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 2 of 7
Figure 4: P/BV of SETBANK vs. SET P/BV (X)
3.6
‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
SET P/BV
____ SETBANK P/BV
3.2
Red‐shirt protest Fire at CTW (May‐10)
2.8 +2.0SD = 2.34x
2.4
+1.0SD = 1.99x
2.0
+0.5SD = 1.81x
Mean = 1.64x 1.6 -0.5SD = 1.46x -1.0SD = 1.29x -2.0SD = 0.93x
1.2 0.8
EU-US Debt crisis Widespread Flood
Military Coup (19 Sept‐06) Yellow‐shirt protest (07)
Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14
0.4
24 Jun 14 = 1.67x Great US recession/Airport Closure
Source: Banks, KT ZMICO Research
Figure 5: Banks’ loans vs. growth Bank only
Change MoM (Btmn)
Loans (Btmn)
Change MoM (%)
Change
Change YTD
Banks' Targets
KTZ (%) 14E 15E
basis
May 14
Mar 14
A pr 14
May 14
Mar 14
A pr 14
May 14
YoY (%)
5M14 (%)
14E (%)
BBL
1 ,7 0 1 ,7 2 3
(5 ,2 0 7 )
1 ,7 2 2
1 ,3 7 9
-0 .3 %
0 .1 %
0 .1 %
8 .4 %
-0 .3 %
3 -5 (from 5 -7 )+
6
8
KTB
1 ,7 9 7 ,9 7 7
2 2 ,1 5 5
2 ,2 6 5
3 1 ,8 3 1
1 .3 %
0 .1 %
1 .8 %
1 0 .6 %
4 .7 %
5 -7
8
9
KBANK
1 ,4 5 8 ,5 6 1
SCB
1 ,7 1 8 ,0 0 9
1 6 ,7 4 8
(8 ,8 7 3 )
TMB
5 1 2 ,3 9 9
(2 ,6 2 1 )
BA Y
8 1 5 ,6 6 4
2 5 ,3 1 2
TCA P* TISCO* KKP
7 8 5 ,2 6 9 2 8 0 ,4 8 9 1 9 5 ,8 9 1
Total
9,265,982
(1 0 ,7 8 8 ) 1 1 ,9 7 9
1 0 ,9 0 4
-0 .7 %
0 .8 %
0 .8 %
6 .9 %
2 .4 %
7 -8
7
8
(1 ,2 7 6 )
1 .0 %
-0 .5 %
-0 .1 %
6 .4 %
-0 .6 %
5 -7
5
7
5 ,0 5 8
8 ,1 4 7
-0 .5 %
1 .0 %
1 .6 %
1 2 .8 %
2 .9 %
6 -8
7
10
1 ,2 0 2
(1 0 ,5 9 3 )
3 .2 %
0 .1 %
-1 .3 %
1 1 .2 %
-0 .8 %
~9
5
9
(7 5 6 ) (1 ,4 2 9 ) 6 ,5 2 4
(4 ,5 5 1 ) (1 ,4 9 4 ) (1 ,6 6 9 )
(1 ,4 2 7 ) (2 ,6 8 5 ) (1 ,5 1 4 )
-0 .1 % -0 .5 % 3 .4 %
-0 .6 % -0 .5 % -0 .8 %
-0 .2 % -0 .9 % -0 .8 %
0 .9 % 1 .7 % 7 .9 %
-0 .8 % -4 .0 % 2 .0 %
6 -7 8 -9 9**
5 2 7
6 13 13
49,938
5,638
34,766
0.54%
0.1%
0.4%
7.8%
1.0%
6
8
Source: Banks, KT ZMICO Research * Consolidated basis ** Including new large corporate banking loans (~Bt6bn). + Excluding loans for M&A purpose.
Figure 6: Banks’ deposits vs. growth Bank only
Change
YTD Change
basis
Deposits (Btmn) May 14
Mar 14
Change MoM (Btmn) A pr 14
May 14
Mar 14
Change MoM (%) A pr 14
May 14
YoY (%)
5M14 (%)
BBL
1 ,8 5 2 ,9 1 3
(3 6 ,9 1 2 )
(1 1 ,5 1 2 )
(1 ,7 3 4 )
-1 .9 %
-0 .6 %
-0 .1 %
4 .2 %
-1 .0 %
KTB
1 ,8 8 4 ,6 1 6
3 8 ,6 2 2
(2 1 ,0 0 2 )
(5 8 ,1 1 0 )
2 .0 %
-1 .1 %
-3 .0 %
8 .8 %
0 .0 %
KBA NK
1 ,5 5 4 ,2 4 0
(3 5 ,3 5 4 )
1 8 ,5 9 6
(2 0 ,5 9 5 )
-2 .2 %
1 .2 %
-1 .3 %
6 .8 %
1 .4 %
SCB
1 ,7 3 4 ,6 2 5
1 3 ,3 3 9
(5 6 ,9 1 1 )
3 ,8 3 5
0 .8 %
-3 .2 %
0 .2 %
-0 .2 %
-4 .7 %
TMB
5 7 4 ,2 7 3
6 ,7 2 7
1 3 ,0 2 3
2 ,5 0 4
1 .2 %
2 .3 %
0 .4 %
1 7 .4 %
8 .4 %
BA Y
7 7 6 ,3 7 6
(1 4 ,7 3 3 )
(9 ,5 6 2 )
2 ,5 0 8
-1 .8 %
-1 .2 %
0 .3 %
5 .6 %
1 .0 %
TCA P*
7 0 4 ,9 1 7
(3 0 ,1 1 1 )
4 ,9 9 3
2 3 ,6 4 4
-4 .3 %
0 .7 %
3 .5 %
1 .8 %
-1 .5 %
TISCO*
2 3 4 ,3 8 8
(1 9 ,4 4 1 )
2 ,1 4 2
4 ,6 3 5
-7 .9 %
0 .9 %
2 .0 %
-0 .1 %
-1 1 .4 %
KKP
1 5 1 ,7 1 4
(1 ,8 9 1 )
2 ,6 0 9
3 ,9 1 2
-1 .3 %
1 .8 %
2 .6 %
-4 .1 %
3 .8 %
Total
9,468,063
(79,753)
(57,624)
(39,400)
-0.8%
-0.6%
-0.4%
5.0%
-0.7%
Source: Banks, KT ZMICO Research * Consolidated basis
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 3 of 7
Figure 7: Thai banks’ loan growth on a YoY basis 20%
Figure 8: Thai banks’ loan & deposit growth on MoM basis 5%
Avg. growth 2008-YTD = 10.2% YoY
4% 15%
3% 2%
10%
0%
5%
-1%
-3% Loan Growth MoM
Source: Banks, KT ZMICO Research
Source: Banks, KT ZMICO Research
Figure 9: Thai banks’ loan-to-deposit and loan-to-
Figure 10: Ratios of loan-to-deposit and loan-todeposit and borrowing as of May-14
98 91
BAY
129
120
111
TMB
100
KTB KBANK SCB
102
BBL
98
100
105
100
Loan to Deposit + Borrowing ratio
92
120
Loan to deposit ratio
89 84
105
Loan to deposit+borrowings
99 92
(%) 140
Loan to deposit
94 90
110
95 90
deposit and borrowing ratios (%)
Deposit Growth MoM
-4%
92 85
-5%
-2% Dec.07 Mar.08 Jun.08 Sept.08 Dec.08 Mar.09 Jun.09 Sept.09 Dec.09 Mar.10 Jun. 10 Sept. 10 Dec.10 Mar.11 Jun.11 Sept.11 Dec.11 Mar.12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13 Sep 13 Dec 13 Mar 14
0%
Dec.08 Mar.09 Jun.09 Sept.09 Dec.09 Mar.10 Jun. 10 Sept. 10 Dec.10 Mar.11 Jun.11 Sept.11 Dec.11 Mar.12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13 Sep 13 Dec 13 Mar 14
1%
80
95
60
90
40 85
Mar 14
Dec 13
Jun 13
Sep 13
Mar 13
Dec 12
Sep 12
Mar.12
Jun 12
Dec.11
Sept.11
Mar.11
Jun.11
Dec.10
Sept. 10
Mar.10
Jun. 10
Dec.09
Jun.09
Sept.09
Mar.09
Dec.08
20 80
Source: Banks, KT ZMICO Research
0 TCAP TISCO KKP Sector
Source: Banks, KT ZMICO Research
Figure 11: Net excess liquidity in the money market to
Figure 12: Capital adequacy ratios as of May-14
total assets as of May-14 (%)
(%) 18
14 12
10.8
5.7
5.0 3.9
4
3.6
3.1
KTB
TMB
SCB
KKP TISCO BAY KBANK TCAP Sector
-2
Source: Banks, KT ZMICO Research
15.0
15.0 14.4 13.8
13.6
13.4
12
2.9 1.6
2 BBL
15.9 15.6
14
7.1
6
0
16.0
16
10 8
17.2
10 8 BBL
SCB
TMB KBANK TISCO BAY
KKP
KTB
TCAP Sector
Source: Banks, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 4 of 7
Figure 13: PBV Band of individual bank and SETBANK BAY’s PBV Band (X)
BBL’s PBV Band (X)
2.3
+2 S.D.
1.75 +2 S.D.
+1 S.D. 1.7
+0.5 S.D. Avg.
1.4
1.50
1.25
-0.5 S.D. -1 S.D.
1.1
-2 S.D.
0.8
1.00
-2 S.D.
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
Source: Bloomberg, KT ZMICO Research KBANK’s PBV Band (X)
+0.5 S.D. Avg. -0.5 S.D. -1 S.D. -2 S.D.
1.1
0.8
0.6
-2S.D. Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
Source: Bloomberg, KT ZMICO Research SCB’s PBV Band 3.0 +2 S.D.
+2 S.D. +1 S.D. +0.5 S.D.
1.2
0.8
-0.5 S.D. -1 S.D.
0.6
(X)
(X) 2.0
1.0
+0.5 S.D. Avg.
1.0
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
KTB’s PBV Band
1.4
+1 S.D.
1.2
0.2
Source: Bloomberg, KT ZMICO Research
1.6
+2 S.D.
0.4
0.6
1.8
+3 S.D.
1.4
+1 S.D.
1.6
KKP’s PBV Band
1.6
+2 S.D.
2.1
Source: Bloomberg, KT ZMICO Research
(X) 1.8
3.1 2.6
-0.5 S.D. -1 S.D.
0.75
0.50
0.5
+1 S.D. +0.5 S.D. Avg.
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
2.0
2.5
+1 S.D. +0.5 S.D. Avg.
Avg. -0.5 S.D.
2.0
-1 S.D. -2 S.D.
0.4
-0.5 S.D. -1 S.D.
1.5 -2 S.D.
1.0
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
0.0
Source: Bloomberg, KT ZMICO Research
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
0.2
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 5 of 7
TCAP’s PBV Band
TISCO’s PBV Band (X)
(X)
2.4
1.6
+2 S.D.
1.4
+2 S.D.
1.2
+1 S.D.
1.0
+0.5 S.D.
2.0
0.8
1.2
-0.5 S.D.
Avg. -0.5 S.D. -1 S.D.
-1 S.D.
0.6
-2 S.D.
0.8
0.4
Source: Bloomberg, KT ZMICO Research
Jan-14
May-14
Sep-13
Jan-13
May-13
Sep-12
Jan-12
May-12
Sep-11
Jan-11
May-11
Source: Bloomberg, KT ZMICO Research
TMB’s PBV Band
SETBANK’s PBV Band P/BV (X)
(X)
3.6
3.0
‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
2.5
+2 S.D.
2.0
+1 S.D.
1.5
+0.5 Avg.
2.0
1.0
-0.5 S.D. -1 S.D.
1.6
2.8
0.4
+0.5SD = 1.81x
-0.5SD = 1.46x -1.0SD = 1.29x -2.0SD = 0.93x
Military Coup (19 Sept‐06) Yellow‐shirt protest (07)
EU-US Debt crisis Widespread Flood
24 Jun 14 = 1.67x Great US recession/Airport Closure
Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14
Jan-14
May-14
Sep-13
Jan-13
Source: Bloomberg, KT ZMICO Research
May-13
Sep-12
Jan-12
May-12
Sep-11
May-11
Jan-11
Sep-10
Jan-10
May-10
Jan-09
Sep-09
0.8
May-09
+1.0SD = 1.99x
Mean = 1.64x 1.2
Red‐shirt protest Fire at CTW (May‐10)
+2.0SD = 2.34x
2.4
-2 S.D.
0.0
SET P/BV
____ SETBANK P/BV
3.2
0.5
Sep-10
Jan-10
May-10
Jan-09
May-09
0.4
Sep-09
-2 S.D.
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14
0.2
1.6 Avg.
+1 S.D. +0.5 S.D.
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES
page 6 of 7
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 TRADING BUY: Expecting positive total returns of 10% or more over the next 3 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.
SELL INTO STRENGTH: Expecting total returns between -10% to +10% over the next 12 month; share price has largely priced in fundamentals
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.
SELL: Expecting negative total returns of 10% or more 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 7 of 7
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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.
