TISCO Financial Group Under review
TISCO Financial Group Under review (17E TP Bt62.00)
Earnings Review
Close Bt71.50
Banking April 18, 2017
Beat forecast/Below forecast/In line
1Q17 net profit 8‐11% ahead of our forecast and the street estimate Results date: April 17, 2017 Price Performance (%)
Sound dividend yield the near‐term price catalyst We put our Outperform rating for TISCO under review. We will revisit our earnings and 17E TP for TISCO after the analyst briefing set for 18 April, with the possibility of an earnings upgrade (likely >10%) vs. our current net profit forecast, mainly from better‐than‐expected NIM and fee income as well as from the potential for a lower‐than‐expected provision. Moreover, we see its attractive dividend yield of 4.9% for the 2016 performance being TISCO’s near‐term price appeal. Note that TISCO will go XD (@Bt3.50/share) on 26 Apr‐17. 1Q17 net profit ahead of our forecast and the street estimate TISCO’s 1Q17 net profit (NP) of Bt1.49bn was ahead of our forecast (Bt1.34bn) by 11% and the street estimate (Bt1.38bn) by 8%. The better‐ than‐expected result vs. our forecast was due largely to 1) a lower‐than‐ expected provision on its much lower NPLs; and 2) better‐than‐expected NIM and fee income.
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
7.194
8.156
KT ZMICO vs. consensus Share data
‐6.4%
‐4.5%
Reuters / Bloomberg
TISCO.BK/TISCO TB
Paid‐up Shares (m)
800.65
Par (Bt)
10.00
Market cap (Bt bn / US$ m)
57.00/1,671.00
Foreign limit / actual (%)
49.00/46.52
52 week High / Low (Bt)
74.25/41.00
Avg. daily T/O (shares 000)
2,976.00
NVDR (%)
17.92
Estimated free float (%)
74.06
Beta
0.69
URL
www.tisco.co.th
CGR
Anti‐corruption
Level 4 (Certified)
Prapharas Nonthapiboon Analyst, no 17836
1Q17 net profit came in at Bt1.49bn (+19% YoY, +15% QoQ) The strong results were backed mainly by stronger NIM and a much lower provision on the continuing improvement in its asset quality despite the loan contraction by 5% YoY and 2% QoQ for 1Q17. NIM still improved slightly QoQ and was ahead of our forecast. The provision in 1Q17 was much lower both YoY and QoQ to just 135 bps from 171bps in 4Q16 and 167bps in 1Q16, vs. TISCO’s provision guidance for 2017 of 130‐140bps. Note also that most of the provision set for 1Q17 was a general provision for a countercyclical buffer. NPL and reserve positions improved sharply QoQ Its NPL ratio for 1Q17 declined both YoY and QoQ to 2.37% from 3.07% in 1Q16 and 2.54% in 4Q16, mainly from the continued decline of NPLs in auto hire purchase loans. This improved its reserve‐to‐NPL ratio for 1Q17 QoQ to 164% from 140% in 4Q16 and its reserve to the BoT’s required LLR to 194% from 173%. Financials and Valuation FY Ended 31 Dec
2014
2015
2016
2017E
2018E
Net profit (Btm)
4,250
4,250
5,005
5,391
6,237
EPS (Bt)
5.31
5.31
6.25
6.73
7.79
EPS growth (%)
0.0%
0.0%
17.8%
7.7%
17.7%
Dividend (Bt)
2.00
2.20
3.50
2.50
2.60
Book value (Bt)
32.14
35.09
38.96
43.68
49.07
FY Ended 31 Dec
2014
2015
2016
2017E
2018E
PER (X)
13.47
13.47
11.44
10.62
9.18
PBV (X)
2.22
2.04
1.84
1.64
1.46
2.80 17.4%
3.08 15.8%
4.90 16.9%
4.31 16.3%
4.49 16.8%
Dividend yield (%) ROE (%)
[email protected] 66 (0) 2695‐5872 REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
Figure 1: 1Q17 earnings results
Statement of Comprehensive Income 1Q16
4Q16
1Q17
% YoY % QoQ
2016
2017E
10,920
11,070
1%
25%
6,140
6,301
3%
27%
17,060
17,371
2%
26%
7,139
4%
26%
8,874
‐1%
25%
3,523
‐11%
21%
Fiscal Year‐Ended December Net Interes t Income
2,692
2,770
2,764
3%
Non Interes t Income
1,514
1,591
1,705
13%
7%
Opera ti ng Income
4,206
4,361
4,469
6%
2%
Opera ti ng Expens es
1,659
1,793
1,867
13%
4%
6,844
Opera ti ng Profi t
2,229
2,259
2,226
0%
‐1%
8,983
Provi s ion (Revers a l )
981
964
753
‐23%
‐22%
3,972
0%
% YoY % 1Q to 17E
Ta xes
309
306
351
14%
15%
1,221
1,308
7%
27%
Net Profi t PPOP EPS (Bt)
1,255 2,227 1.57
1,293 2,254 1.61
1,491 2,218 1.86
19% 0% 19%
15% ‐2% 15%
5,005 8,965 6.25
5,391 8,864 6.73
8% ‐1% 8%
28% 25% 28%
Key Statistics & Ratios
1Q16 4Q16 1Q17 7,158 5,710 5,221
Gros s NPLs (Btmn) Gros s NPLs /Loa ns
2016 2017E 5,710 6,216
3.07%
2.54%
2.37%
2.54%
2.38%
89.3% 139.0% 14.1%
139.8% 172.6% 14.9%
164.0% 194.6% 14.9%
139.8% 172.6% 15.2%
137.1% N.A. 14.8%
18.1%
19.8%
19.8%
19.3%
18.1%
Loa n to Depos i t Ra ti o
152.5%
145.1%
141.4%
145.1%
147.8%
Loa n to Depos i ts a nd Borrowi ngs
Loa n Los s Res erve/NPLs LLR/BoT requi red res erve Ti er I/Ri s k As s et Ca pi ta l Adequa cy Ra ti o
102.3%
99.8%
101.0%
99.8%
106.9%
Cos t to Income
39.4%
41.1%
41.8%
40.1%
41.1%
Non Interes t Income/Tota l Income
34.6%
35.4%
37.2%
36.0%
36.3%
Ta x ra te Net Interes t Ma rgi n Interes t Sprea d Provi s ion/Loa ns Provi s ion to a vera ge l oa ns Loa n growth YoY Loa n growth QoQ
19.7% 3.73% 4.31% 1.68% 1.67% ‐8.4% ‐2.1%
19.1% 4.04% 4.63% 1.71% 1.71% ‐5.6% ‐0.7%
19.0% 4.07% 4.70% 1.36% 1.35% ‐5.4% ‐2.0%
19.6% 3.98% 3.79% 1.77% 1.72% ‐5.6%
19.5% 3.92% 3.70% 1.35% 1.45% 16.5%
Source: Bloomberg and KTZMICO Research
Figure 2: TISCO's P/BV band and sensitivity of market prices based on P/BV at different standard deviation levels (X) 2.4 2.0 1.6
+2 S.D. +1.5 S.D. +1 S.D. +0.5 S.D. Avg. -0.5 S.D. -1 S.D. -1.5 S.D. -2 S.D.
1.2 0.8
Source: Bloomberg, KT ZMICO Research
Jul-16
Jan-17
Jul-15
Jan-16
Jul-14
Jan-15
Jul-13
Jan-14
Jul-12
Jan-13
Jul-11
Jan-12
Jul-10
Jan-11
Jan-10
Jul-09
Jan-09
0.4
2017E
PBV (x)
Implied market Upside/ Downside price (Bt) to current price (%)
+2.0SD
2.0
88
22
+1.5SD
1.9
81
13
+1.0SD
1.7
75
4
+0.5SD
1.6
68
-5
Average
1.4
61
-14
-0.5SD
1.3
55
-23
-1.0SD
1.1
48
-32
-1.5SD
1.0
42
-41
-2.0SD
0.8
35
-51
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
Figure 3: TISCO's PER band and sensitivity of market prices based on PER at different standard deviation levels (X) 12 11 10 9 8 7
2017E
PER (x)
+2.0SD
10.6
72
0
+1.5SD
10.0
67
-6
+1.0SD
9.3
62
-13
+0.5SD
8.6
58
-19
+2 S.D. +1.5 S.D. +1 S.D. +0.5 S.D. Avg. -0.5 S.D. -1 S.D. -1.5 S.D. -2 S.D.
6
Implied market Upside/ Downside price (Bt) to current price (%)
35
-51
Jul-09
Jan-10
Jan-09
Jan-17
5.2
Jul-16
-2.0SD
Source: Bloomberg, KT ZMICO Research
Jul-15
-45
Jan-16
40
Jul-14
5.9
Jan-15
-38
-1.5SD
Jul-13
44
Jan-14
6.6
Jul-12
-1.0SD
Jan-13
-32
3
Jul-11
-25
49
Jan-12
53
7.2
Jul-10
7.9
-0.5SD Jan-11
Average
4
5
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 4
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, CI, TTL, NMG.
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 4 of 4
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
Earnings Review
Close Bt71.50
Banking April 18, 2017
Beat forecast/Below forecast/In line
1Q17 net profit 8‐11% ahead of our forecast and the street estimate Results date: April 17, 2017 Price Performance (%)
Sound dividend yield the near‐term price catalyst We put our Outperform rating for TISCO under review. We will revisit our earnings and 17E TP for TISCO after the analyst briefing set for 18 April, with the possibility of an earnings upgrade (likely >10%) vs. our current net profit forecast, mainly from better‐than‐expected NIM and fee income as well as from the potential for a lower‐than‐expected provision. Moreover, we see its attractive dividend yield of 4.9% for the 2016 performance being TISCO’s near‐term price appeal. Note that TISCO will go XD (@Bt3.50/share) on 26 Apr‐17. 1Q17 net profit ahead of our forecast and the street estimate TISCO’s 1Q17 net profit (NP) of Bt1.49bn was ahead of our forecast (Bt1.34bn) by 11% and the street estimate (Bt1.38bn) by 8%. The better‐ than‐expected result vs. our forecast was due largely to 1) a lower‐than‐ expected provision on its much lower NPLs; and 2) better‐than‐expected NIM and fee income.
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
7.194
8.156
KT ZMICO vs. consensus Share data
‐6.4%
‐4.5%
Reuters / Bloomberg
TISCO.BK/TISCO TB
Paid‐up Shares (m)
800.65
Par (Bt)
10.00
Market cap (Bt bn / US$ m)
57.00/1,671.00
Foreign limit / actual (%)
49.00/46.52
52 week High / Low (Bt)
74.25/41.00
Avg. daily T/O (shares 000)
2,976.00
NVDR (%)
17.92
Estimated free float (%)
74.06
Beta
0.69
URL
www.tisco.co.th
CGR
Anti‐corruption
Level 4 (Certified)
Prapharas Nonthapiboon Analyst, no 17836
1Q17 net profit came in at Bt1.49bn (+19% YoY, +15% QoQ) The strong results were backed mainly by stronger NIM and a much lower provision on the continuing improvement in its asset quality despite the loan contraction by 5% YoY and 2% QoQ for 1Q17. NIM still improved slightly QoQ and was ahead of our forecast. The provision in 1Q17 was much lower both YoY and QoQ to just 135 bps from 171bps in 4Q16 and 167bps in 1Q16, vs. TISCO’s provision guidance for 2017 of 130‐140bps. Note also that most of the provision set for 1Q17 was a general provision for a countercyclical buffer. NPL and reserve positions improved sharply QoQ Its NPL ratio for 1Q17 declined both YoY and QoQ to 2.37% from 3.07% in 1Q16 and 2.54% in 4Q16, mainly from the continued decline of NPLs in auto hire purchase loans. This improved its reserve‐to‐NPL ratio for 1Q17 QoQ to 164% from 140% in 4Q16 and its reserve to the BoT’s required LLR to 194% from 173%. Financials and Valuation FY Ended 31 Dec
2014
2015
2016
2017E
2018E
Net profit (Btm)
4,250
4,250
5,005
5,391
6,237
EPS (Bt)
5.31
5.31
6.25
6.73
7.79
EPS growth (%)
0.0%
0.0%
17.8%
7.7%
17.7%
Dividend (Bt)
2.00
2.20
3.50
2.50
2.60
Book value (Bt)
32.14
35.09
38.96
43.68
49.07
FY Ended 31 Dec
2014
2015
2016
2017E
2018E
PER (X)
13.47
13.47
11.44
10.62
9.18
PBV (X)
2.22
2.04
1.84
1.64
1.46
2.80 17.4%
3.08 15.8%
4.90 16.9%
4.31 16.3%
4.49 16.8%
Dividend yield (%) ROE (%)
[email protected] 66 (0) 2695‐5872 REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
Figure 1: 1Q17 earnings results
Statement of Comprehensive Income 1Q16
4Q16
1Q17
% YoY % QoQ
2016
2017E
10,920
11,070
1%
25%
6,140
6,301
3%
27%
17,060
17,371
2%
26%
7,139
4%
26%
8,874
‐1%
25%
3,523
‐11%
21%
Fiscal Year‐Ended December Net Interes t Income
2,692
2,770
2,764
3%
Non Interes t Income
1,514
1,591
1,705
13%
7%
Opera ti ng Income
4,206
4,361
4,469
6%
2%
Opera ti ng Expens es
1,659
1,793
1,867
13%
4%
6,844
Opera ti ng Profi t
2,229
2,259
2,226
0%
‐1%
8,983
Provi s ion (Revers a l )
981
964
753
‐23%
‐22%
3,972
0%
% YoY % 1Q to 17E
Ta xes
309
306
351
14%
15%
1,221
1,308
7%
27%
Net Profi t PPOP EPS (Bt)
1,255 2,227 1.57
1,293 2,254 1.61
1,491 2,218 1.86
19% 0% 19%
15% ‐2% 15%
5,005 8,965 6.25
5,391 8,864 6.73
8% ‐1% 8%
28% 25% 28%
Key Statistics & Ratios
1Q16 4Q16 1Q17 7,158 5,710 5,221
Gros s NPLs (Btmn) Gros s NPLs /Loa ns
2016 2017E 5,710 6,216
3.07%
2.54%
2.37%
2.54%
2.38%
89.3% 139.0% 14.1%
139.8% 172.6% 14.9%
164.0% 194.6% 14.9%
139.8% 172.6% 15.2%
137.1% N.A. 14.8%
18.1%
19.8%
19.8%
19.3%
18.1%
Loa n to Depos i t Ra ti o
152.5%
145.1%
141.4%
145.1%
147.8%
Loa n to Depos i ts a nd Borrowi ngs
Loa n Los s Res erve/NPLs LLR/BoT requi red res erve Ti er I/Ri s k As s et Ca pi ta l Adequa cy Ra ti o
102.3%
99.8%
101.0%
99.8%
106.9%
Cos t to Income
39.4%
41.1%
41.8%
40.1%
41.1%
Non Interes t Income/Tota l Income
34.6%
35.4%
37.2%
36.0%
36.3%
Ta x ra te Net Interes t Ma rgi n Interes t Sprea d Provi s ion/Loa ns Provi s ion to a vera ge l oa ns Loa n growth YoY Loa n growth QoQ
19.7% 3.73% 4.31% 1.68% 1.67% ‐8.4% ‐2.1%
19.1% 4.04% 4.63% 1.71% 1.71% ‐5.6% ‐0.7%
19.0% 4.07% 4.70% 1.36% 1.35% ‐5.4% ‐2.0%
19.6% 3.98% 3.79% 1.77% 1.72% ‐5.6%
19.5% 3.92% 3.70% 1.35% 1.45% 16.5%
Source: Bloomberg and KTZMICO Research
Figure 2: TISCO's P/BV band and sensitivity of market prices based on P/BV at different standard deviation levels (X) 2.4 2.0 1.6
+2 S.D. +1.5 S.D. +1 S.D. +0.5 S.D. Avg. -0.5 S.D. -1 S.D. -1.5 S.D. -2 S.D.
1.2 0.8
Source: Bloomberg, KT ZMICO Research
Jul-16
Jan-17
Jul-15
Jan-16
Jul-14
Jan-15
Jul-13
Jan-14
Jul-12
Jan-13
Jul-11
Jan-12
Jul-10
Jan-11
Jan-10
Jul-09
Jan-09
0.4
2017E
PBV (x)
Implied market Upside/ Downside price (Bt) to current price (%)
+2.0SD
2.0
88
22
+1.5SD
1.9
81
13
+1.0SD
1.7
75
4
+0.5SD
1.6
68
-5
Average
1.4
61
-14
-0.5SD
1.3
55
-23
-1.0SD
1.1
48
-32
-1.5SD
1.0
42
-41
-2.0SD
0.8
35
-51
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
Figure 3: TISCO's PER band and sensitivity of market prices based on PER at different standard deviation levels (X) 12 11 10 9 8 7
2017E
PER (x)
+2.0SD
10.6
72
0
+1.5SD
10.0
67
-6
+1.0SD
9.3
62
-13
+0.5SD
8.6
58
-19
+2 S.D. +1.5 S.D. +1 S.D. +0.5 S.D. Avg. -0.5 S.D. -1 S.D. -1.5 S.D. -2 S.D.
6
Implied market Upside/ Downside price (Bt) to current price (%)
35
-51
Jul-09
Jan-10
Jan-09
Jan-17
5.2
Jul-16
-2.0SD
Source: Bloomberg, KT ZMICO Research
Jul-15
-45
Jan-16
40
Jul-14
5.9
Jan-15
-38
-1.5SD
Jul-13
44
Jan-14
6.6
Jul-12
-1.0SD
Jan-13
-32
3
Jul-11
-25
49
Jan-12
53
7.2
Jul-10
7.9
-0.5SD Jan-11
Average
4
5
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 4
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, CI, TTL, NMG.
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 4 of 4
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
