Revenue just started recovering QoQ
The -
Ch. Karnchang Buy (17E TP Bt37.00)
Earnings Review
Close Bt26.75
Construction Services May 16, 2017
Beat forecast/Below forecast/In line
Revenue just started recovering QoQ Maintain BUY with TP slightly lowered to Bt37 We maintain our BUY call for CK with the SOTP‐based target price lowered to Bt37, vs. Bt38 previously, after revisiting our valuation of BEM, CKP, and TTW. CK is still our favorite in the sector owing to the company being a beneficiary from public investment projects. Meanwhile, CK’s huge backlog on hand will support revenue over the next three years. Investment in affiliates will also strengthen CK’s earnings with the potential for additional backlog in the longer term.
Results date: May 15, 2017 Price Performance (%)
Normalized profit increased QoQ in 1Q17 CK reported net profit of Bt302mn, including an extra item of Bt39mn from gain from an investment sale. Stripping out the extra item, CK delivered normalized profit of Bt263mn, flat YoY but increasing by 56% QoQ. On a yearly basis, earnings were maintained owing to higher interest income from loans to Xayaburi Power Co., Ltd. On a quarter‐to‐quarter basis, norm. profit increased by 56% QoQ on higher revenue and a rise in the gross profit margin. CK delivered revenue of Bt8.1bn in 1Q17, falling by 10% YoY (as additional projects signed in 2016 were very low at only Bt4.7bn) but increasing by 6% QoQ. Meanwhile, CK’s GPM improved to 8.1% in 1Q17, vs. 7.5% in 4Q16, due to a lesser revenue contribution from Xayaburi’s VO.
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
0.939
1.125
KT ZMICO vs. consensus Share data
‐19.1%
‐12.9%
Reuters / Bloomberg
CK.BK/CK TB
Paid‐up Shares (m)
1,693.90
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
45.00/1,312.00
Foreign limit / actual (%)
25.00/7.42
52 week High / Low (Bt)
34.50/24.20
Avg. daily T/O (shares 000) NVDR (%)
14,886.00 3.82
Estimated free float (%)
61.34
Beta
1.48
URL
www.ch‐karnchang.co.th
CGR
Anti‐corruption
n.a.
Raenoo Bhandasukdi Analyst no. 17989 [email protected]
Backlog on hand (and potential) stays high at around Bt123bn As of 1Q17, we calculate that CK’s backlog likely stands at Bt103.5bn, including YTD signed contracts of Bt28.2bn (Orange Line mass transit and motorway). Meanwhile, CK will likely sign the M&E contract with BEM for the Blue Line mass transit project valued at Bt19.6bn soon (BEM’s board already announced this pending shareholders’ approval). As a result, CK’s backlog on hand (and awaiting to be signed) will likely stand at Bt123bn, which will support revenue over the next 3.4 years. Maintain earnings projection As CK’s net profit in 1Q17 accounted for 24% of our full‐year projection, we maintain our net profit estimate in 2017E for CK. Financials and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) Norm. profit (Btmn) Norm. EPS (Bt) Norm. EPS growth (%) Dividend (Bt) BV (Bt) FY Ended 31 Dec Norm. PER (x) EV/EBITDA (x) P/BV (x) Dividend yield (%) ROE (%) Net gearing (%)
2015 34,912 2,193 1.29 477 0.28 (61.72) 0.65 12.08 2015 95.01 40.80 2.21 2.43 2.41 239.49
2016 45,864 2,002 1.18 1,786 1.05 274.42 0.50 12.68 2016 25.38 33.26 2.11 1.87 8.52 208.30
2017E 36,442 1,286 0.76 1,286 0.76 (27.97) 0.32 13.12 2017E 35.23 36.36 2.04 1.20 5.89 197.85
66 (0) 2695‐5836
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 3
2018E 41,988 1,658 0.98 1,658 0.98 28.95 0.41 13.68 2018E 27.30 31.61 1.95 1.55 7.31 178.65
2019E 41,814 1,938 1.14 1,938 1.14 16.87 0.48 14.34 2019E 23.38 28.59 1.86 1.81 8.16 150.86
Figure 1: Summary of sum‐of‐the‐parts (SOTP) valuation for CK Company CK’s stake (%) Construction business CK’s investment stake - BEM 29.73 - CKP 28.77 - TTW 19.40 Minus: Net debt used for associates Net value of CK’s stake in associates
Valuation Method 2.3x (+0.5SD) of 17E adj. BVS of Bt8.60
Value to CK (Bt) 19.8
KTZMICO’s TP of Bt8.10 KT ZMICO’s TP of Bt3.50 KT ZMICO’s TP of Bt11.10
22.3 4.5 5.2 (14.6) 17.3
SOTP‐based TP
37.1
Source: KT ZMICO Research
Figure 2: CK’s P/BV band and sensitivity of market prices based on P/BV at different standard deviation levels (X) 7.0
2017E +1.5SD +1.0SD +0.5SD average ‐0.5SD ‐1.0SD ‐1.5SD
6.0 5.0 4.0 +1 S.D.
3.0
Avg.
2.0
+0.5 S.D.
-0.5S.D.
1.0
Jun-16
Feb-17
Jan-15
Sep-15
Apr-14
Aug-13
Nov-12
Jun-11
Mar-12
Jan-10
Oct-10
May-09
Dec-07
Aug-08
Jul-06
Mar-07
Oct-05
Jun-04
Jan-03
Sep-03
Feb-05
-1 S.D.
0.0
P/BV (x) 3.3 2.8 2.3 1.8 1.4 0.9 0.4
Implied market price (Bt) 42.93 36.71 30.50 24.28 18.07 11.85 5.64
Upside/Downside vs. current market price (%) 60.48 37.24 14.01 (9.23) (32.46) (55.70) (78.93)
Source: Bloomberg, KT ZMICO Research
Figure 3: 1Q17 earnings review Profit and Loss (Btmn) Year‐end 31 Dec Revenue Gross profit SG&A EBITDA Interest expenses Other income Income tax Other extra items Gn (Ls) from affiliates Net profit (loss) Normalized profit (loss) Reported EPS (Bt) Gross margin (%) EBITDA margin (%) Norm. profit margin (%) Current ratio (x) Interest coverage (x) Debt/equity (x) BVPS (Bt) ROE (%)
1Q16 9,003 799 (416) 607 (238) 29 (42) 43 149 305 262 0.18
4Q16 7,609 570 (419) 446 (426) 208 91 174 155 342 168 0.20
1Q17 8,098 657 (416) 485 (366) 207 (12) 39 196 302 263 0.18
% YoY (10.1) (17.8) 0.1 (20.0) 54.0 601.7 n.m. (9.1) 31.7 (0.9) 0.4 (0.9)
% QoQ 6.4 15.2 (0.8) 8.9 (14.0) (0.7) n.m. (77.6) 26.8 (11.8) 56.4 (11.8)
2016 45,864 3,334 (1,781) 2,508 (1,166) 885 (23) 217 578 2,002 1,786 1.18
2017E 36,442 3,091 (1,836) 2,273 (1,767) 1,021 (114) ‐ 937 1,286 1,286 0.76
8.9 6.7 2.9 1.5 1.6 2.7 12.1 5.1
7.5 5.9 2.2 1.1 0.4 2.7 12.7 3.2
8.1 6.0 3.2 1.1 0.7 2.5 12.8 4.9
7.3 5.5 3.9 1.1 1.3 2.7 12.7 8.5
8.5 6.2 3.5 0.6 0.7 2.6 13.1 5.9
% YoY (20.5) (7.3) 3.0 (9.4) 51.6 15.4 388.5 (100.0) 62.2 (35.8) (28.0) (35.8)
YTD (% of 17E) 22.2 21.3 22.7 21.4 20.7 20.3 10.4 ‐ 20.9 23.5 20.4 23.5
Source: CK, KT ZMICO Research
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, TFD, TTL, NMG, NUSA.
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)
Anti‐corruption Progress Indicator
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
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
Ch. Karnchang Buy (17E TP Bt37.00)
Earnings Review
Close Bt26.75
Construction Services May 16, 2017
Beat forecast/Below forecast/In line
Revenue just started recovering QoQ Maintain BUY with TP slightly lowered to Bt37 We maintain our BUY call for CK with the SOTP‐based target price lowered to Bt37, vs. Bt38 previously, after revisiting our valuation of BEM, CKP, and TTW. CK is still our favorite in the sector owing to the company being a beneficiary from public investment projects. Meanwhile, CK’s huge backlog on hand will support revenue over the next three years. Investment in affiliates will also strengthen CK’s earnings with the potential for additional backlog in the longer term.
Results date: May 15, 2017 Price Performance (%)
Normalized profit increased QoQ in 1Q17 CK reported net profit of Bt302mn, including an extra item of Bt39mn from gain from an investment sale. Stripping out the extra item, CK delivered normalized profit of Bt263mn, flat YoY but increasing by 56% QoQ. On a yearly basis, earnings were maintained owing to higher interest income from loans to Xayaburi Power Co., Ltd. On a quarter‐to‐quarter basis, norm. profit increased by 56% QoQ on higher revenue and a rise in the gross profit margin. CK delivered revenue of Bt8.1bn in 1Q17, falling by 10% YoY (as additional projects signed in 2016 were very low at only Bt4.7bn) but increasing by 6% QoQ. Meanwhile, CK’s GPM improved to 8.1% in 1Q17, vs. 7.5% in 4Q16, due to a lesser revenue contribution from Xayaburi’s VO.
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
0.939
1.125
KT ZMICO vs. consensus Share data
‐19.1%
‐12.9%
Reuters / Bloomberg
CK.BK/CK TB
Paid‐up Shares (m)
1,693.90
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
45.00/1,312.00
Foreign limit / actual (%)
25.00/7.42
52 week High / Low (Bt)
34.50/24.20
Avg. daily T/O (shares 000) NVDR (%)
14,886.00 3.82
Estimated free float (%)
61.34
Beta
1.48
URL
www.ch‐karnchang.co.th
CGR
Anti‐corruption
n.a.
Raenoo Bhandasukdi Analyst no. 17989 [email protected]
Backlog on hand (and potential) stays high at around Bt123bn As of 1Q17, we calculate that CK’s backlog likely stands at Bt103.5bn, including YTD signed contracts of Bt28.2bn (Orange Line mass transit and motorway). Meanwhile, CK will likely sign the M&E contract with BEM for the Blue Line mass transit project valued at Bt19.6bn soon (BEM’s board already announced this pending shareholders’ approval). As a result, CK’s backlog on hand (and awaiting to be signed) will likely stand at Bt123bn, which will support revenue over the next 3.4 years. Maintain earnings projection As CK’s net profit in 1Q17 accounted for 24% of our full‐year projection, we maintain our net profit estimate in 2017E for CK. Financials and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) Norm. profit (Btmn) Norm. EPS (Bt) Norm. EPS growth (%) Dividend (Bt) BV (Bt) FY Ended 31 Dec Norm. PER (x) EV/EBITDA (x) P/BV (x) Dividend yield (%) ROE (%) Net gearing (%)
2015 34,912 2,193 1.29 477 0.28 (61.72) 0.65 12.08 2015 95.01 40.80 2.21 2.43 2.41 239.49
2016 45,864 2,002 1.18 1,786 1.05 274.42 0.50 12.68 2016 25.38 33.26 2.11 1.87 8.52 208.30
2017E 36,442 1,286 0.76 1,286 0.76 (27.97) 0.32 13.12 2017E 35.23 36.36 2.04 1.20 5.89 197.85
66 (0) 2695‐5836
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 3
2018E 41,988 1,658 0.98 1,658 0.98 28.95 0.41 13.68 2018E 27.30 31.61 1.95 1.55 7.31 178.65
2019E 41,814 1,938 1.14 1,938 1.14 16.87 0.48 14.34 2019E 23.38 28.59 1.86 1.81 8.16 150.86
Figure 1: Summary of sum‐of‐the‐parts (SOTP) valuation for CK Company CK’s stake (%) Construction business CK’s investment stake - BEM 29.73 - CKP 28.77 - TTW 19.40 Minus: Net debt used for associates Net value of CK’s stake in associates
Valuation Method 2.3x (+0.5SD) of 17E adj. BVS of Bt8.60
Value to CK (Bt) 19.8
KTZMICO’s TP of Bt8.10 KT ZMICO’s TP of Bt3.50 KT ZMICO’s TP of Bt11.10
22.3 4.5 5.2 (14.6) 17.3
SOTP‐based TP
37.1
Source: KT ZMICO Research
Figure 2: CK’s P/BV band and sensitivity of market prices based on P/BV at different standard deviation levels (X) 7.0
2017E +1.5SD +1.0SD +0.5SD average ‐0.5SD ‐1.0SD ‐1.5SD
6.0 5.0 4.0 +1 S.D.
3.0
Avg.
2.0
+0.5 S.D.
-0.5S.D.
1.0
Jun-16
Feb-17
Jan-15
Sep-15
Apr-14
Aug-13
Nov-12
Jun-11
Mar-12
Jan-10
Oct-10
May-09
Dec-07
Aug-08
Jul-06
Mar-07
Oct-05
Jun-04
Jan-03
Sep-03
Feb-05
-1 S.D.
0.0
P/BV (x) 3.3 2.8 2.3 1.8 1.4 0.9 0.4
Implied market price (Bt) 42.93 36.71 30.50 24.28 18.07 11.85 5.64
Upside/Downside vs. current market price (%) 60.48 37.24 14.01 (9.23) (32.46) (55.70) (78.93)
Source: Bloomberg, KT ZMICO Research
Figure 3: 1Q17 earnings review Profit and Loss (Btmn) Year‐end 31 Dec Revenue Gross profit SG&A EBITDA Interest expenses Other income Income tax Other extra items Gn (Ls) from affiliates Net profit (loss) Normalized profit (loss) Reported EPS (Bt) Gross margin (%) EBITDA margin (%) Norm. profit margin (%) Current ratio (x) Interest coverage (x) Debt/equity (x) BVPS (Bt) ROE (%)
1Q16 9,003 799 (416) 607 (238) 29 (42) 43 149 305 262 0.18
4Q16 7,609 570 (419) 446 (426) 208 91 174 155 342 168 0.20
1Q17 8,098 657 (416) 485 (366) 207 (12) 39 196 302 263 0.18
% YoY (10.1) (17.8) 0.1 (20.0) 54.0 601.7 n.m. (9.1) 31.7 (0.9) 0.4 (0.9)
% QoQ 6.4 15.2 (0.8) 8.9 (14.0) (0.7) n.m. (77.6) 26.8 (11.8) 56.4 (11.8)
2016 45,864 3,334 (1,781) 2,508 (1,166) 885 (23) 217 578 2,002 1,786 1.18
2017E 36,442 3,091 (1,836) 2,273 (1,767) 1,021 (114) ‐ 937 1,286 1,286 0.76
8.9 6.7 2.9 1.5 1.6 2.7 12.1 5.1
7.5 5.9 2.2 1.1 0.4 2.7 12.7 3.2
8.1 6.0 3.2 1.1 0.7 2.5 12.8 4.9
7.3 5.5 3.9 1.1 1.3 2.7 12.7 8.5
8.5 6.2 3.5 0.6 0.7 2.6 13.1 5.9
% YoY (20.5) (7.3) 3.0 (9.4) 51.6 15.4 388.5 (100.0) 62.2 (35.8) (28.0) (35.8)
YTD (% of 17E) 22.2 21.3 22.7 21.4 20.7 20.3 10.4 ‐ 20.9 23.5 20.4 23.5
Source: CK, KT ZMICO Research
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, TFD, TTL, NMG, NUSA.
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)
Anti‐corruption Progress Indicator
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
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
