Outperform (17E TP Bt14.00) Company Update
BCPG Outperform (17E TP Bt14.00)
Company Update
Close Bt14.10
Energy & Utilities November 15, 2016
Earnings upgrade / Earnings downgrade / Overview unchanged
Potential MW additions as the windfall Price Performance (%)
Source: SET Smart
FY16
FY17
Consensus EPS (Bt)
0.942
1.063
KT ZMICO vs. consensus Share data
68.8%
‐2.2%
Reuters / Bloomberg
BCPG.BK / BCPG TB
Paid‐up Shares (m)
1,990.00
Par (Bt)
5.00
Market cap (Bt bn / US$ m)
28.00/791.00
Foreign limit / actual (%)
49.00/2.09
52 week High / Low (Bt)
15.90/10.60
Avg. daily T/O (shares 000)
163,336.00
NVDR (%)
0.95
Estimated free float (%)
29.63
Beta
1.98
URL
www.bcpggroup.com ‐
CGR Anti‐corruption
n.a.
Patcharin Karsemarnuntana Analyst, no 17834 [email protected] 66 (0) 2695‐5837
Reinitiate with Outperform rating We reinitiate BCPG with the newly revised up 2017E SOTP TP of Bt14/share. This implies 0.13x 2017E PBV/ROE, undemanding compared with domestic renewable peers at the average of 0.16x 2017E PBV/ROE currently, with potential upside risk on its capacity expansion to installed capacity of 1,000MW by 2020E, causing it to deserve a trading premium. Thus, we assign an “Outperform” rating on BCPG. Revise up 2017E SOTP‐based TP to Bt14 We raise our 2017E SOTP‐based TP to Bt14/share (vs. Bt12.2 earlier), with 1) the inclusion of five developing projects totaling 85.1MW in contracted capacity in our valuation (projects #11‐14, and project #8 whose lawsuit has been settled and the grid connection applied), and 2) the fine‐tuning of the higher equity IRR of project #7 (Yabuki; 20MW contracted capacity) to 20% (vs. 16% earlier) given a more favorable D/E ratio of 90% : 10% (vs. 85% : 15% earlier) and lower cost of fund at approximately 1% (vs. 2% assumed earlier), likely the best deal terms among its solar project portfolio in Japan. Upward revision on 2017‐18E earnings estimates Given that the company’s 9M16 NP represented 73% of our full‐year forecast, we maintain our 2016E NP for BCPG at Bt1.67bn, with an expected seasonal bounce back of the power generation of solar Thailand in 4Q. Meanwhile, we revise up its 2017‐18E NP estimates by 4% and 12%, respectively, to incorporate the contribution from Projects #11‐14 and Project #8 in our projections. Given the base effect of SG&A expenses in 2016E, our forecasts suggest negative growth of 20% in the year, but accelerating growth at 21% CAGR during 2017‐18E, with the ramp up of the contribution from solar Japan during the period as the major driver. Challenging target of 1,000MW by 2020E as source of upside risk The company aggressively reaffirms its long‐term target to reach installed capacity of 1,000MW by 2020E, with nearly half secured by projects in the pipeline totaling installed capacity of 418MW (~324MW PPA) and the remaining gap to be filled by future opportunities for MW additions. The potential capacity expansion is regionally focused in Japan (large potential solar projects), frontier countries (including Lao PDR, Myanmar, and Vietnam, with the initial growth stage of renewable projects to come up with an attractive feed‐in‐tariff), and other potential countries (i.e., Indonesia, the Philippines, Korea), with the target for a well‐diversified portfolio covering solar, biomass, wind, hydropower, and geothermal. Financials and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) – weighted EPS (Bt) – FD Weighted EPS growth (%) Dividend (Bt) BV (Bt) FY Ended 31 Dec PER (x) EV/EBITDA (x) PBV (x) Dividend yield (%) ROE (%) Net gearing (%)
2014 2,692 1,861 2.54 2.51 30.67 2.45 6.49 2014 5.56 6.59 2.17 17.3% 40.9% 132.2%
2015 3,024 2,084 2.82 2.82 11.05 3.45 5.31 2015 5.01 6.03 2.65 24.5% 47.7% 171.5%
2016E 3,358 1,672 1.59 0.84 (43.56) 0.50 8.59 2016E 8.87 10.17 1.64 3.6% 15.9% ‐1.2%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 5
2017E 4,222 2,063 1.04 1.04 (34.74) 0.62 9.01 2017E 13.60 11.40 1.57 4.4% 11.8% 62.5%
2018E 5,604 2,455 1.23 1.23 18.98 0.74 9.50 2018E 11.43 9.73 1.48 5.2% 13.3% 98.5%
Figure 1: BCPG’s 3Q16 earnings review Profit and Loss (Btmn) Year‐end 31 Dec Revenue Gross profit EBITDA Interest expense Other income Income tax Forex gain (loss) Extraordinary Items Gn (Ls) from affiliates Minority interests Net profit (loss) Core profit (loss) Reported EPS (Bt) Gross margin (%) EBITDA margin (%) Net margin (%) Current ratio (x) Interest coverage (x) Debt / equity (x) BVPS (Bt) ROE (%)
3Q15*
2Q16
3Q16
731 575 690 (51) 2 (0) ‐ ‐ ‐ ‐ 521 521 0.42 78.7 94.5 71.3 na 11.2 na na na
759 573 597 (92) 18 4 163 (90) ‐ ‐ 459 386 0.33 75.4 78.6 60.5 2.5 5.0 1.0 5.8 22.7
785 575 598 (82) 14 0 (12) ‐ ‐ ‐ 365 377 0.25 73.2 76.2 46.5 5.5 5.4 0.7 7.2 10.2
% YoY
% QoQ
7.4 (0.0) (13.3) 61.9 494.6 nm nm nm nm nm (30.0) (27.6) (40.5)
3.4 0.4 0.3 (10.9) (24.3) (87.9) nm nm nm nm (20.6) (2.3) (24.2)
9M15*
9M16
2,258 1,795 2,132 (153) 11 (2) ‐ ‐ ‐ ‐ 1,631 1,631 1.31 79.5 94.4 72.2 na 11.6 na na na
2,327 1,748 1,840 (255) 35 4 133 (110) ‐ ‐ 1,215 1,192 1.01 75.1 79.0 52.2 5.5 5.5 0.7 7.2 11.4
% YoY 3.1 (2.6) (13.7) 66.2 217.4 nm nm nm nm nm (25.5) (26.9) (22.9)
2015
2016E
3,024 2,394 2,827 (266) 14 (11) (2) ‐ ‐ ‐ 2,084 2,085 2.82 79.2 93.5 68.9 1.8 8.8 1.9 5.3 47.7
3,358 2,514 2,685 (351) 32 (12) ‐ (110) ‐ ‐ 1,672 1,782 1.59 74.9 79.9 49.8 10.6 6.0 0.6 8.6 15.9
Source: KT Zmico Research Note: *before business restructuring
Figure 2: BCPG’s long‐term target for capacity expansion
Source: The Company
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 5
% YoY
YTD (%16E)
11.0 5.0 (5.0) 31.7 130.8 1.7 (100) nm nm nm (19.8) (14.5) (43.6)
69% 70% 69% 73% 108% nm nm 100% nm nm 73% 67% 64%
Figure 3: BCPG’s solar projects in Japan
Source: The Company
Figure 3: BCPG’s solar cooperative projects in Thailand
Source: The Company
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 5
Financial tables
PROFIT & LOSS (Btm) Revenues Cost of sales and service Gross profit SG&A EBITDA Depreciation & amortization EBIT Interest expense Other income / exp. EBT Corporate tax Forex gain (loss) Extra Items Gain (loss) from affiliates Minority interests Net profit Reported EPS Fully diluted EPS Core net profit Fully diluted core EPS Dividend (Bt)
2013 1,463 (351) 1,112 (17) 1,371 275 1,096 (219) 11 887 0 0 0 0 0 887 1.94 1.37 887 1.37 0.00
2014 2,692 (556) 2,136 (27) 2,540 430 2,110 (272) 28 1,865 (5) 0 0 0 0 1,861 2.54 2.51 1,861 2.51 2.45
2015 3,024 (630) 2,394 (45) 2,827 478 2,349 (266) 14 2,097 (11) (2) 0 0 0 2,084 2.82 2.82 2,085 2.82 3.45
2016E 3,358 (844) 2,514 (402) 2,685 573 2,112 (351) 32 1,794 (12) 0 (110) 0 0 1,672 1.59 0.84 1,782 0.90 0.50
2017E 4,222 (1,282) 2,940 (422) 3,399 881 2,518 (423) 32 2,127 (64) 0 0 0 0 2,063 1.04 1.04 2,063 1.04 0.62
2018E 5,604 (2,015) 3,589 (481) 4,515 1,407 3,108 (532) 32 2,608 (153) 0 0 0 0 2,455 1.23 1.23 2,455 1.23 0.74
BALANCE SHEET (Btm) Cash and equivalents Accounts receivable Inventories PP&E-net Other assets Total assets ST debt & current portion Long-term debt Total liabilities Paid-up shares Shareholder equity Minority interests Total liab. & shareholder equity
2013 1,758 361 0 7,630 126 9,875 431 4,805 5,586 3,236 4,288 0 9,875
2014 1,017 547 0 10,656 34 12,254 438 6,879 7,451 3,700 4,803 0 12,254
2015 975 456 0 10,220 21 11,671 656 6,939 7,741 3,700 3,930 0 11,671
2016E 10,895 1,012 0 14,932 1,531 28,370 543 9,591 11,271 9,950 17,099 0 28,370
2017E 8,092 1,272 0 26,874 1,564 37,802 3,907 14,886 19,877 9,950 17,924 0 37,802
2018E 1,297 1,689 0 34,837 1,600 39,424 1,280 15,887 20,517 9,950 18,906 0 39,424
2013 887 0 275 (142) 1,021 (7,905)
2014 1,861 0 430 (308) 1,983 (3,457)
2015 2,084 2 478 139 2,702 (41)
2016E 1,672 0 573 (114) 2,131 (5,285)
2017E 2,063 0 881 (250) 2,694 (12,823)
2018E 2,455 0 1,407 (311) 3,552 (9,371)
(7,905) 5,235 3,401 0 6 8,642 1,758 (6,884) (10.64)
(3,457) 7,317 464 (1,810) (2) 5,969 4,495 (1,474) (1.99)
(41) 7,595 (405) (2,552) (25) 4,613 7,274 2,661 3.60
(5,285) 10,134 12,488 (1,003) (949) 20,670 17,516 (3,154) (1.58)
(12,823) 18,793 (64) (1,238) (33) 17,459 7,330 (10,129 (5.09)
(9,371) 17,167 (153) (1,473) (36) 15,505 9,686 (5,819) (2.92)
2013 na na na 76.0 93.7 74.9 60.7 60.7 (0.0)
2014 84.1 85.3 30.7 79.4 94.3 78.4 69.1 69.1 0.2
2015 12.3 11.3 11.0 79.2 93.5 77.7 68.9 69.0 0.5
2016E 11.0 (5.0) (43.6) 74.9 79.9 62.9 49.8 53.1 0.6
2017E 25.7 26.6 (34.7) 69.6 80.5 59.6 48.9 48.9 3.0
2018E 32.7 32.8 19.0 64.0 80.6 55.5 43.8 43.8 5.9
CASH FLOW (Btm) Net income Forex and other extraordinary adjustments Depreciation & amortization Change in working capital Cash flow from operations Capex (Invest)/Divest Others Cash flow from investing Debt financing (repayment) Equity financing Dividend payment Others Cash flow from financing Net change in cash Free cash flow FCF per share (Bt) PROFITABILITY Revenue growth (%) EBITDA growth (%) EPS growth (%) Gross margin (%) EBITDA margin (%) Operating margin (%) Net margin (%) Core profit margin (%) Effective tax rate (%)
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 4 of 5
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, PACE, TPOLY, M‐CHAI, TFD, SUTHA, CI.
Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD) Excellent (scores: 90 ‐ 100) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
Anti‐corruption Progress Indicator Source: Sec, Thailand's Private Sector Collective Action Coalition Against Corruption programme (Thai CAC)
Level 1 (Committed) : Organization’s statement or board's resolution to work against corruption and to be in compliance with all relevant laws. Level 2 (Declared) : Public declaration statement to participate in Thailand's private sector Collective Action Coalition Against Corruption (CAC) or equivalent initiatives Level 3 (Established) : Public out preventive measures, risk assessment, communication and training for all employees, including consistent monitoring and review processes Level 4 (Certified) : Audit engagement by audit committee or auditors approved by the office of SEC, and receiving certification or assurance by independent external assurance providers (CAC etc.) Level 5 (Extended) : Extension of the anti‐corruption policy to business partners in the supply chain, and disclosure of any current investigations, prosecutions or closed cases Insufficient or not clearly defined policy Data not available / no policy
DISCLAIMER This document is produced using open sources believed to be reliable. However, their accuracy and completeness cannot be guaranteed. The statements and opinions herein were formed after due and careful consideration for use as information for the purposes of investment. The opinions contained herein are subject to change without notice. This document is not, and should not be construed as, an offer or the solicitation of an offer to buy or sell any securities. The use of any information contained in this document shall be at the sole discretion and risk of the user.
KT ZMICO RESEARCH – RECOMMENDATION DEFINITIONS STOCK RECOMMENDATIONS
SECTOR RECOMMENDATIONS
BUY: Expecting positive total returns of 15% or more OVERWEIGHT: The industry, as defined by the analyst's over the next 12 months coverage universe, is expected to outperform the relevant OUTPERFORM: Expecting total returns between ‐10% primary market index by at least 10% over the next 12 months. to +15%; returns expected to exceed market returns NEUTRAL: The industry, as defined by the analyst's coverage over a six‐month period due to specific catalysts universe, is expected to perform in line with the relevant UNDERPERFORM: Expecting total returns between primary market index over the next 12 months. ‐10% to +15%; returns expected to be below market UNDERWEIGHT: The industry, as defined by the analyst's returns over a six‐month period due to specific coverage universe, is expected to underperform the relevant catalysts primary market index by 10% over the next 12 months. SELL: Expecting negative total returns of 10% or more over the next 12 months
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 5 of 5
KT ZMICO Securities Company Limited Head Office
WWW.KTZMICO.COM
8th, 15th‐17th,19th, 21st Floor, Liberty Square Bldg., 287 Silom Road, Bangrak, Bangkok, Thailand 10500 Telephone: (66‐2) 695‐5000 Fax: (66‐2) 695‐5173 KT ZMICO Connect 662 695 5555
Central World Branch
Amarin Branch
22nd Floor, Amarin Building, 496‐502 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 018‐6200 Fax: (66‐2) 018‐6298, (66‐2) 018‐6299
8th Floor, Ton Son Tower, 900 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 626‐6000 Fax: (66‐2) 626‐6111
Phaholyothin Branch
Sindhorn Branch
Viphavadee Branch
2nd Floor, Sindhorn Tower 1, 130‐132 Wireless Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 627‐3550 Fax: (66‐2) 627‐3582, 627‐3600
G Floor, Lao Peng Nguan 1 Bldg., 333 Soi Cheypuand, Viphavadee‐Rangsit Road, Ladyao, Jatujak, Bangkok 10900 Telephone: (66‐2) 013‐8600 Fax: (66‐2) 618‐8569
BangKhae Branch
Chiang Mai Branch
Pak Chong Branch
999/9 The Offices at Central World, 16th Fl., Rama 1 Rd, Pathumwan, Bangkok 10330 Telephone: (66‐2) 264‐5888 Fax: (66‐2) 264 5899
1291/1, Shinnawatra Tower II, 3rd Floor, Phaholyothin Road, Phayathai, Bangkok 10400 Telephone: (66‐2) 686‐1500 Fax: (66‐2) 686‐1666
Ploenchit Branch
518 The Mall Group Building Bangkhae Branch, 6th Floor, Petchkasem Road, North Bangkhae, Bangkhae, Bangkok 10160 Telephone: (66‐2) 454‐9979 Fax: (66‐2) 454‐9970
422/49 Changklan Road, Changklan Subdistrict, Amphoe Meuang, Chiang Mai 50100 Telephone: (053) 270‐072 Fax: (053) 272‐618
173 175, Mittapap Road, Nong Sarai, Pak Chong, Nakhon Ratchasima 30130 Telephone: (044) 279‐511 Fax: (044) 279‐574
Korat Branch
Khon Kaen Branch
Chonburi Branch
624/9 Changphuek Road, T.Naimaung, A.Maung, Nakhon Ratchasima 30000 Telephone: (044) 247222 Fax: (044) 247171
5th Floor, Charoen Thani Princess Hotel, 260 Srichan Road, T. Naimuang, A. Muang, Khon Kaen 40000 Telephone: (043) 389‐171‐193 Fax: (043) 389‐209
4th Floor, Forum Plaza Bldg., 870/52 Sukhumvit Road, T. Bangplasoy, A. Muang, Cholburi 20000 Telephone: (038) 287‐635 Fax: (038) 287‐637
Pattaya Branch
Chachoengsao Branch
Hat Yai Branch
Easy Point 2, 392/65 Moo.9, T.Nong Prue, A. Bang Lamung, Chonburi 20260 Telephone: (038) 420‐965 Fax: (038) 420‐968
108/34‐36 Mahajakkrapad Road, T.Namuang, A.Muang, Chachoengsao 24000 Telephone: (038) 813‐088 Fax: (038) 813‐099
200/301, 200/303 JULDIS HATYAI PLAZA Floor 3 , Niphat‐Uthit 3 Rd, Hatyai Songkhla 90110 Telephone: (074) 355530‐3 Fax: (074) 355534
Phuket Branch
22/61‐63, Luang Por Wat Chalong Road, Talat Yai, Mueang Phuket, Phuket 83000 Telephone: (076) 222‐811, (076) 222‐683 Fax: (076) 222‐861
Phitsanulok Branch
227/171 Borom Trilokkanat Road, Muang, Phitsanulok 65000 Telephone: 055‐219‐255 to 8 Fax: 055‐219‐259
Nakhon Pathom
Cyber Branch Ayutthaya
Cyber Branch @ North Nana
Cyber Branch Chiangrai
KrungThai Bank, Rojana Branch 253 Moo 5, Rojana Road, Phai Ling, Phra Nakhon Si Ayutthaya, Phra Nakhonsi Ayutthaya, 13000 Telephone: 035‐242‐477 Fax: 035‐242‐476
Krung Thai Bank PCL, 2 Floor, North Nana Branch 35 Sukhumvit Rd., Klong Toey Nua Subdistrict , Wattana District , Bangkok 10110 Telephone: 083‐490‐2871
River Hotel (Building 3rd),1156 Petchakasem Road, Sanamchan Subdistrict, Amphoe Meuang , Nakhon Pathom Province 73000 Telephone: (034) 271300 Fax: (034) 271300 #100
KrungThai Bank, Hayaek Phokhun Mengrai Branch 116/19 Moo 19, Highway 110 Road, Rop Wiang, Mueang Chiang Rai, Chiang Rai, 57000 Telephone: 053‐715‐067 Fax: 053‐715‐068
Company Update
Close Bt14.10
Energy & Utilities November 15, 2016
Earnings upgrade / Earnings downgrade / Overview unchanged
Potential MW additions as the windfall Price Performance (%)
Source: SET Smart
FY16
FY17
Consensus EPS (Bt)
0.942
1.063
KT ZMICO vs. consensus Share data
68.8%
‐2.2%
Reuters / Bloomberg
BCPG.BK / BCPG TB
Paid‐up Shares (m)
1,990.00
Par (Bt)
5.00
Market cap (Bt bn / US$ m)
28.00/791.00
Foreign limit / actual (%)
49.00/2.09
52 week High / Low (Bt)
15.90/10.60
Avg. daily T/O (shares 000)
163,336.00
NVDR (%)
0.95
Estimated free float (%)
29.63
Beta
1.98
URL
www.bcpggroup.com ‐
CGR Anti‐corruption
n.a.
Patcharin Karsemarnuntana Analyst, no 17834 [email protected] 66 (0) 2695‐5837
Reinitiate with Outperform rating We reinitiate BCPG with the newly revised up 2017E SOTP TP of Bt14/share. This implies 0.13x 2017E PBV/ROE, undemanding compared with domestic renewable peers at the average of 0.16x 2017E PBV/ROE currently, with potential upside risk on its capacity expansion to installed capacity of 1,000MW by 2020E, causing it to deserve a trading premium. Thus, we assign an “Outperform” rating on BCPG. Revise up 2017E SOTP‐based TP to Bt14 We raise our 2017E SOTP‐based TP to Bt14/share (vs. Bt12.2 earlier), with 1) the inclusion of five developing projects totaling 85.1MW in contracted capacity in our valuation (projects #11‐14, and project #8 whose lawsuit has been settled and the grid connection applied), and 2) the fine‐tuning of the higher equity IRR of project #7 (Yabuki; 20MW contracted capacity) to 20% (vs. 16% earlier) given a more favorable D/E ratio of 90% : 10% (vs. 85% : 15% earlier) and lower cost of fund at approximately 1% (vs. 2% assumed earlier), likely the best deal terms among its solar project portfolio in Japan. Upward revision on 2017‐18E earnings estimates Given that the company’s 9M16 NP represented 73% of our full‐year forecast, we maintain our 2016E NP for BCPG at Bt1.67bn, with an expected seasonal bounce back of the power generation of solar Thailand in 4Q. Meanwhile, we revise up its 2017‐18E NP estimates by 4% and 12%, respectively, to incorporate the contribution from Projects #11‐14 and Project #8 in our projections. Given the base effect of SG&A expenses in 2016E, our forecasts suggest negative growth of 20% in the year, but accelerating growth at 21% CAGR during 2017‐18E, with the ramp up of the contribution from solar Japan during the period as the major driver. Challenging target of 1,000MW by 2020E as source of upside risk The company aggressively reaffirms its long‐term target to reach installed capacity of 1,000MW by 2020E, with nearly half secured by projects in the pipeline totaling installed capacity of 418MW (~324MW PPA) and the remaining gap to be filled by future opportunities for MW additions. The potential capacity expansion is regionally focused in Japan (large potential solar projects), frontier countries (including Lao PDR, Myanmar, and Vietnam, with the initial growth stage of renewable projects to come up with an attractive feed‐in‐tariff), and other potential countries (i.e., Indonesia, the Philippines, Korea), with the target for a well‐diversified portfolio covering solar, biomass, wind, hydropower, and geothermal. Financials and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) – weighted EPS (Bt) – FD Weighted EPS growth (%) Dividend (Bt) BV (Bt) FY Ended 31 Dec PER (x) EV/EBITDA (x) PBV (x) Dividend yield (%) ROE (%) Net gearing (%)
2014 2,692 1,861 2.54 2.51 30.67 2.45 6.49 2014 5.56 6.59 2.17 17.3% 40.9% 132.2%
2015 3,024 2,084 2.82 2.82 11.05 3.45 5.31 2015 5.01 6.03 2.65 24.5% 47.7% 171.5%
2016E 3,358 1,672 1.59 0.84 (43.56) 0.50 8.59 2016E 8.87 10.17 1.64 3.6% 15.9% ‐1.2%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 5
2017E 4,222 2,063 1.04 1.04 (34.74) 0.62 9.01 2017E 13.60 11.40 1.57 4.4% 11.8% 62.5%
2018E 5,604 2,455 1.23 1.23 18.98 0.74 9.50 2018E 11.43 9.73 1.48 5.2% 13.3% 98.5%
Figure 1: BCPG’s 3Q16 earnings review Profit and Loss (Btmn) Year‐end 31 Dec Revenue Gross profit EBITDA Interest expense Other income Income tax Forex gain (loss) Extraordinary Items Gn (Ls) from affiliates Minority interests Net profit (loss) Core profit (loss) Reported EPS (Bt) Gross margin (%) EBITDA margin (%) Net margin (%) Current ratio (x) Interest coverage (x) Debt / equity (x) BVPS (Bt) ROE (%)
3Q15*
2Q16
3Q16
731 575 690 (51) 2 (0) ‐ ‐ ‐ ‐ 521 521 0.42 78.7 94.5 71.3 na 11.2 na na na
759 573 597 (92) 18 4 163 (90) ‐ ‐ 459 386 0.33 75.4 78.6 60.5 2.5 5.0 1.0 5.8 22.7
785 575 598 (82) 14 0 (12) ‐ ‐ ‐ 365 377 0.25 73.2 76.2 46.5 5.5 5.4 0.7 7.2 10.2
% YoY
% QoQ
7.4 (0.0) (13.3) 61.9 494.6 nm nm nm nm nm (30.0) (27.6) (40.5)
3.4 0.4 0.3 (10.9) (24.3) (87.9) nm nm nm nm (20.6) (2.3) (24.2)
9M15*
9M16
2,258 1,795 2,132 (153) 11 (2) ‐ ‐ ‐ ‐ 1,631 1,631 1.31 79.5 94.4 72.2 na 11.6 na na na
2,327 1,748 1,840 (255) 35 4 133 (110) ‐ ‐ 1,215 1,192 1.01 75.1 79.0 52.2 5.5 5.5 0.7 7.2 11.4
% YoY 3.1 (2.6) (13.7) 66.2 217.4 nm nm nm nm nm (25.5) (26.9) (22.9)
2015
2016E
3,024 2,394 2,827 (266) 14 (11) (2) ‐ ‐ ‐ 2,084 2,085 2.82 79.2 93.5 68.9 1.8 8.8 1.9 5.3 47.7
3,358 2,514 2,685 (351) 32 (12) ‐ (110) ‐ ‐ 1,672 1,782 1.59 74.9 79.9 49.8 10.6 6.0 0.6 8.6 15.9
Source: KT Zmico Research Note: *before business restructuring
Figure 2: BCPG’s long‐term target for capacity expansion
Source: The Company
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 5
% YoY
YTD (%16E)
11.0 5.0 (5.0) 31.7 130.8 1.7 (100) nm nm nm (19.8) (14.5) (43.6)
69% 70% 69% 73% 108% nm nm 100% nm nm 73% 67% 64%
Figure 3: BCPG’s solar projects in Japan
Source: The Company
Figure 3: BCPG’s solar cooperative projects in Thailand
Source: The Company
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 5
Financial tables
PROFIT & LOSS (Btm) Revenues Cost of sales and service Gross profit SG&A EBITDA Depreciation & amortization EBIT Interest expense Other income / exp. EBT Corporate tax Forex gain (loss) Extra Items Gain (loss) from affiliates Minority interests Net profit Reported EPS Fully diluted EPS Core net profit Fully diluted core EPS Dividend (Bt)
2013 1,463 (351) 1,112 (17) 1,371 275 1,096 (219) 11 887 0 0 0 0 0 887 1.94 1.37 887 1.37 0.00
2014 2,692 (556) 2,136 (27) 2,540 430 2,110 (272) 28 1,865 (5) 0 0 0 0 1,861 2.54 2.51 1,861 2.51 2.45
2015 3,024 (630) 2,394 (45) 2,827 478 2,349 (266) 14 2,097 (11) (2) 0 0 0 2,084 2.82 2.82 2,085 2.82 3.45
2016E 3,358 (844) 2,514 (402) 2,685 573 2,112 (351) 32 1,794 (12) 0 (110) 0 0 1,672 1.59 0.84 1,782 0.90 0.50
2017E 4,222 (1,282) 2,940 (422) 3,399 881 2,518 (423) 32 2,127 (64) 0 0 0 0 2,063 1.04 1.04 2,063 1.04 0.62
2018E 5,604 (2,015) 3,589 (481) 4,515 1,407 3,108 (532) 32 2,608 (153) 0 0 0 0 2,455 1.23 1.23 2,455 1.23 0.74
BALANCE SHEET (Btm) Cash and equivalents Accounts receivable Inventories PP&E-net Other assets Total assets ST debt & current portion Long-term debt Total liabilities Paid-up shares Shareholder equity Minority interests Total liab. & shareholder equity
2013 1,758 361 0 7,630 126 9,875 431 4,805 5,586 3,236 4,288 0 9,875
2014 1,017 547 0 10,656 34 12,254 438 6,879 7,451 3,700 4,803 0 12,254
2015 975 456 0 10,220 21 11,671 656 6,939 7,741 3,700 3,930 0 11,671
2016E 10,895 1,012 0 14,932 1,531 28,370 543 9,591 11,271 9,950 17,099 0 28,370
2017E 8,092 1,272 0 26,874 1,564 37,802 3,907 14,886 19,877 9,950 17,924 0 37,802
2018E 1,297 1,689 0 34,837 1,600 39,424 1,280 15,887 20,517 9,950 18,906 0 39,424
2013 887 0 275 (142) 1,021 (7,905)
2014 1,861 0 430 (308) 1,983 (3,457)
2015 2,084 2 478 139 2,702 (41)
2016E 1,672 0 573 (114) 2,131 (5,285)
2017E 2,063 0 881 (250) 2,694 (12,823)
2018E 2,455 0 1,407 (311) 3,552 (9,371)
(7,905) 5,235 3,401 0 6 8,642 1,758 (6,884) (10.64)
(3,457) 7,317 464 (1,810) (2) 5,969 4,495 (1,474) (1.99)
(41) 7,595 (405) (2,552) (25) 4,613 7,274 2,661 3.60
(5,285) 10,134 12,488 (1,003) (949) 20,670 17,516 (3,154) (1.58)
(12,823) 18,793 (64) (1,238) (33) 17,459 7,330 (10,129 (5.09)
(9,371) 17,167 (153) (1,473) (36) 15,505 9,686 (5,819) (2.92)
2013 na na na 76.0 93.7 74.9 60.7 60.7 (0.0)
2014 84.1 85.3 30.7 79.4 94.3 78.4 69.1 69.1 0.2
2015 12.3 11.3 11.0 79.2 93.5 77.7 68.9 69.0 0.5
2016E 11.0 (5.0) (43.6) 74.9 79.9 62.9 49.8 53.1 0.6
2017E 25.7 26.6 (34.7) 69.6 80.5 59.6 48.9 48.9 3.0
2018E 32.7 32.8 19.0 64.0 80.6 55.5 43.8 43.8 5.9
CASH FLOW (Btm) Net income Forex and other extraordinary adjustments Depreciation & amortization Change in working capital Cash flow from operations Capex (Invest)/Divest Others Cash flow from investing Debt financing (repayment) Equity financing Dividend payment Others Cash flow from financing Net change in cash Free cash flow FCF per share (Bt) PROFITABILITY Revenue growth (%) EBITDA growth (%) EPS growth (%) Gross margin (%) EBITDA margin (%) Operating margin (%) Net margin (%) Core profit margin (%) Effective tax rate (%)
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 4 of 5
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, PACE, TPOLY, M‐CHAI, TFD, SUTHA, CI.
Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD) Excellent (scores: 90 ‐ 100) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
Anti‐corruption Progress Indicator Source: Sec, Thailand's Private Sector Collective Action Coalition Against Corruption programme (Thai CAC)
Level 1 (Committed) : Organization’s statement or board's resolution to work against corruption and to be in compliance with all relevant laws. Level 2 (Declared) : Public declaration statement to participate in Thailand's private sector Collective Action Coalition Against Corruption (CAC) or equivalent initiatives Level 3 (Established) : Public out preventive measures, risk assessment, communication and training for all employees, including consistent monitoring and review processes Level 4 (Certified) : Audit engagement by audit committee or auditors approved by the office of SEC, and receiving certification or assurance by independent external assurance providers (CAC etc.) Level 5 (Extended) : Extension of the anti‐corruption policy to business partners in the supply chain, and disclosure of any current investigations, prosecutions or closed cases Insufficient or not clearly defined policy Data not available / no policy
DISCLAIMER This document is produced using open sources believed to be reliable. However, their accuracy and completeness cannot be guaranteed. The statements and opinions herein were formed after due and careful consideration for use as information for the purposes of investment. The opinions contained herein are subject to change without notice. This document is not, and should not be construed as, an offer or the solicitation of an offer to buy or sell any securities. The use of any information contained in this document shall be at the sole discretion and risk of the user.
KT ZMICO RESEARCH – RECOMMENDATION DEFINITIONS STOCK RECOMMENDATIONS
SECTOR RECOMMENDATIONS
BUY: Expecting positive total returns of 15% or more OVERWEIGHT: The industry, as defined by the analyst's over the next 12 months coverage universe, is expected to outperform the relevant OUTPERFORM: Expecting total returns between ‐10% primary market index by at least 10% over the next 12 months. to +15%; returns expected to exceed market returns NEUTRAL: The industry, as defined by the analyst's coverage over a six‐month period due to specific catalysts universe, is expected to perform in line with the relevant UNDERPERFORM: Expecting total returns between primary market index over the next 12 months. ‐10% to +15%; returns expected to be below market UNDERWEIGHT: The industry, as defined by the analyst's returns over a six‐month period due to specific coverage universe, is expected to underperform the relevant catalysts primary market index by 10% over the next 12 months. SELL: Expecting negative total returns of 10% or more over the next 12 months
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 5 of 5
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
