ROBINS
Robinson Department Store Sell (16E TP Bt47.00)
Company Update
Close Bt66.00
Commerce July 29, 2016
Earnings upgrade/Earnings downgrade/Overview unchanged
Improving profit trend fully priced in Price Performance (%)
Source: SET Smart
FY16
FY17
Consensus EPS (Bt)
2.269
2.652
KT ZMICO vs. consensus Share data
‐2.2%
0.7%
Reuters / Bloomberg
ROBI.BK/ROBINS TB
Paid‐up Shares (m)
1,110.66
Par (Bt)
3.55
Market cap (Bt bn / US$ m)
73.00/2,101.00
Foreign limit / actual (%)
49.00/18.23
52 week High / Low (Bt)
69.00/36.75
Avg. daily T/O (shares 000) NVDR (%)
2,375.00 5.17
Estimated free float (%)
40.58
Beta
0.86
URL
http://robins.listedcompany.com
CGR
Anti‐corruption
Level 2 (Declared)
Pornsawat Jirajarus Analyst, no 18228 [email protected] 66 (0) 2624‐6257
Growth factors remain vulnerable The stock price rally of 52% YTD should have caused the price to exceed the stock’s fundamental value, in our view. The market seems to be too optimistic on the improving gross margin trend, which has fluctuated significantly according to the historical pattern. We believe descending growth in rental revenue will lower its profit growth in 2H16‐17E. With the weak economy remaining a headwind for businesses selling discretionary items like ROBINS and the stock price providing limited upside, even if the TP is rolled over to next year, we downgrade the rating on ROBINS from “Underperform” to “Sell”. Rising rental income and a decline in tax expenses to boost 2Q16 profit We expect ROBINS to report 2Q16 net profit of Bt565mn (EPS of Bt0.51), up 28% YoY but down 18% QoQ (seasonal). Rising rental income (+15% YoY or +Bt96mn), a decline in corporate income tax (effective rate down 500‐ 600 bps YoY to 18%) and its well‐controlled selling expenses should be the key catalysts contributing around two‐thirds of the YoY profit growth. Sales growth should remain weak at 5% YoY, with the main driver from new stores (Burirum, Srisaman and Maesod added during 2H15; no new stores in 1H16). Same‐store‐sales growth should soften to 1.5% YoY, from 2.6% in 1Q16, as early rains have reduced customer traffic. Rising sales in licensed international brands (apparel & shoes) should lift the gross margin by 63 bps YoY (+10 bps QoQ) to 25.2%. Our 1H16 net profit estimate is Bt1.25bn, up 19% YoY and accounting for 51% of the full‐year forecast. Turning to slower growth in 2H16 ROBINS just opened a new store in Nakorn Srithammarat yesterday (this store is a 50:50 JV with a local partner). An improving gross margin and rising rents should remain the earnings catalysts, but we expect its YoY profit growth to turn softer in 2H16 as additional rent will come mainly from the Lopburi store to be opened in December; on top of that, its 4Q15 profit was a rather high base. In light of the above along with ROBINS’s plan to roll out merely three new stores in 17E, we believe our forecast for the growth in rental revenue (key profit driver in FY15‐16E) to decline from 38% YoY in FY15 to 13%‐14% YoY in 16E‐17E remains suitable. We also view that the recovery in discretionary spending will continue to be slow and the profitability of fashion products (i.e., gross margin in figure 4) will fluctuate. We maintain our forecasts for net profit growth of 14%‐20% in 16E‐17E, with the 16E DCF TP of Bt47 (WACC 10.5%, terminal growth 3.0%). Financials and Valuation FY Ended 31 Dec 2014 Revenues (Bt mn) 25,754 Net profit (Bt mn) 1,927 EPS (Bt) 1.74 EPS growth (%) ‐ 2.93 Dividend (Bt) 0.75 BV (Bt) 11.85 FY Ended 31 Dec 2014 PER (x) 24.9 EV/EBITDA (x) 11.6 PBV (x) 3.6 Dividend yield (%) 1.73 ROE (%) 15.31 Net Gearing (%) 0.13
2015 27,739 2,153 1.94 11.70 1.00 13.01 2015 20.9 10.3 3.0 2.53 15.30 0.10
2016E 28,946 2,465 2.22 14.47 1.00 14.45 2016E 29.7 14.6 4.6 1.52 16.16 0.05
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
2017E 31,896 2,965 2.67 20.29 1.25 16.38 2017E 24.7 12.3 4.0 1.89 17.31 cash
2018E 35,662 3,542 3.19 19.48 1.50 18.64 2018E 20.7 10.6 3.5 2.27 18.21 cash
Figure 1: Quarterly earnings preview Profit and Loss (Bt mn) FY Ended 31 Dec Revenue Gross profit EBITDA Interest expense Other income Income tax Forex gain (loss) Other extraordinary Items Gn (Ls) from affiliates Net profit (loss) Normalized profit (loss) Reported EPS (THB) Gross margin (%) EBITDA margin (%) Net margin (%) Current ratio (x) Interest coverage (x) Debt / equity (x) BVPS (Bt) ROE (%)
2Q15 5,860 1,440 1,037 19 842 150 0 0 93 440 440 0.40 24.6 15.5 6.6 0.4 high 0.8 11.1 15.6
3Q15 6,031 1,443 970 20 860 90 0 0 90 397 397 0.36 23.9 14.1 5.8 0.5 high 0.8 11.7 15.7
4Q15 7,258 1,789 1,326 22 1,026 151 0 49 151 701 652 0.63 24.6 16.0 8.5 0.5 high 0.9 12.1 16.4
1Q16 6,395 1,608 1,347 17 951 158 0 0 122 686 686 0.62 25.1 18.3 9.3 0.6 high 0.7 12.7 16.8
2Q16E % YoY % QoQ 1H15 1H16E % YoY 6,148 4.9 (3.9) 11,896 12,543 5.4 1,549 7.6 (3.6) 2,931 3,157 7.7 1,219 17.6 (9.5) 2,203 2,566 16.5 19 n.m. n.m. 37 35 (5) 946 12.4 (0.5) 1,691 1,897 12.2 134 (10.6) (15.1) 293 293 (0.1) 0 n.m. n.m. 0 0 n.m. 0 n.m. n.m. 0 0 n.m. 100 8 (18) 211 222 6 565 28.4 (17.7) 1,054 1,251 18.7 565 28.4 (17.7) 1,054 1,251 18.7 0.51 28.4 (17.7) 0.95 1.13 18.7 25.2 24.6 25.2 17.2 18.5 20.5 8.0 8.9 10.0 n.a. 0.4 n.a. high high high n.a. 0.8 n.a. n.a. 11.1 n.a. n.a. 15.6 n.a.
2016E 26,127 6,399 5,070 69 3,893 607 0 0 519 2,465 2,465 2.22 24.5 16.9 8.2 1.0 high 0.6 9.8 20.7
% YoY % YTD 3.7 48.0 3.8 49.3 12.7 50.6 (12.7) 51.0 8.8 48.7 13.6 48.2
15.0 14.5 17.2 14.5
42.8 50.8 50.8 50.8
Source: ROBINS and KTZMICO Research Figure 2: Quarterly same‐store‐sales growth SSSG
(Bt mn)
Total sales growth
Net profit (LHS)
800
30.0%
Sales growth %
NP growth %
140% 120%
700
25.0%
100%
600
20.0%
80%
500
15.0%
60%
400
10.0%
40%
300
Source: Company data, KT ZMICO Research
Source: KT ZMICO Research
Figure 4: Gross margin trend
Figure 5: Revenue from investments
Gross margin
Revenue from investments
(Bt mn)
26%
800
25%
Source: Company data, KT ZMICO Research
1Q16
1Q15
1Q14
1Q13
1Q12
1Q16
1Q15
22%
1Q14
200
1Q13
23%
1Q12
400
1Q11
24%
1Q11
600
Source: KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
4Q16E
1Q16 2Q16E
1Q15
-40% 1Q14
-20%
1Q13
0%
100
-10.0%
20%
200
1Q12
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16E
0.0%
1Q11
5.0%
-5.0%
Figure 3: Sales growth and net profit growth trends
Figure 6: PE and PBV bands
PE Band
P/BV Band (X)
(X)
8.0
50 +2 S.D.
7.0
+1 S.D.
6.0
40
+2 S.D. +1 S.D.
5.0
30
Avg.
Avg.
4.0 20
-1 S.D.
10
-2 S.D.
3.0
-1 S.D.
2.0 -2 S.D.
1.0
0
Source: Company data, KT ZMICO Research
Jan-16
Jan-15
Jan-14
Jan-13
Jan-12
Jan-10
Jan-16
Jan-15
Jan-14
Jan-13
Jan-12
Jan-11
Jan-10
Jan-11
0.0
-10
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, PACE, PLE, TPOLY, M‐CHAI. KT ZMICO is a co‐underwriter of ALT, EKH.
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 4 of 4
th
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.
Company Update
Close Bt66.00
Commerce July 29, 2016
Earnings upgrade/Earnings downgrade/Overview unchanged
Improving profit trend fully priced in Price Performance (%)
Source: SET Smart
FY16
FY17
Consensus EPS (Bt)
2.269
2.652
KT ZMICO vs. consensus Share data
‐2.2%
0.7%
Reuters / Bloomberg
ROBI.BK/ROBINS TB
Paid‐up Shares (m)
1,110.66
Par (Bt)
3.55
Market cap (Bt bn / US$ m)
73.00/2,101.00
Foreign limit / actual (%)
49.00/18.23
52 week High / Low (Bt)
69.00/36.75
Avg. daily T/O (shares 000) NVDR (%)
2,375.00 5.17
Estimated free float (%)
40.58
Beta
0.86
URL
http://robins.listedcompany.com
CGR
Anti‐corruption
Level 2 (Declared)
Pornsawat Jirajarus Analyst, no 18228 [email protected] 66 (0) 2624‐6257
Growth factors remain vulnerable The stock price rally of 52% YTD should have caused the price to exceed the stock’s fundamental value, in our view. The market seems to be too optimistic on the improving gross margin trend, which has fluctuated significantly according to the historical pattern. We believe descending growth in rental revenue will lower its profit growth in 2H16‐17E. With the weak economy remaining a headwind for businesses selling discretionary items like ROBINS and the stock price providing limited upside, even if the TP is rolled over to next year, we downgrade the rating on ROBINS from “Underperform” to “Sell”. Rising rental income and a decline in tax expenses to boost 2Q16 profit We expect ROBINS to report 2Q16 net profit of Bt565mn (EPS of Bt0.51), up 28% YoY but down 18% QoQ (seasonal). Rising rental income (+15% YoY or +Bt96mn), a decline in corporate income tax (effective rate down 500‐ 600 bps YoY to 18%) and its well‐controlled selling expenses should be the key catalysts contributing around two‐thirds of the YoY profit growth. Sales growth should remain weak at 5% YoY, with the main driver from new stores (Burirum, Srisaman and Maesod added during 2H15; no new stores in 1H16). Same‐store‐sales growth should soften to 1.5% YoY, from 2.6% in 1Q16, as early rains have reduced customer traffic. Rising sales in licensed international brands (apparel & shoes) should lift the gross margin by 63 bps YoY (+10 bps QoQ) to 25.2%. Our 1H16 net profit estimate is Bt1.25bn, up 19% YoY and accounting for 51% of the full‐year forecast. Turning to slower growth in 2H16 ROBINS just opened a new store in Nakorn Srithammarat yesterday (this store is a 50:50 JV with a local partner). An improving gross margin and rising rents should remain the earnings catalysts, but we expect its YoY profit growth to turn softer in 2H16 as additional rent will come mainly from the Lopburi store to be opened in December; on top of that, its 4Q15 profit was a rather high base. In light of the above along with ROBINS’s plan to roll out merely three new stores in 17E, we believe our forecast for the growth in rental revenue (key profit driver in FY15‐16E) to decline from 38% YoY in FY15 to 13%‐14% YoY in 16E‐17E remains suitable. We also view that the recovery in discretionary spending will continue to be slow and the profitability of fashion products (i.e., gross margin in figure 4) will fluctuate. We maintain our forecasts for net profit growth of 14%‐20% in 16E‐17E, with the 16E DCF TP of Bt47 (WACC 10.5%, terminal growth 3.0%). Financials and Valuation FY Ended 31 Dec 2014 Revenues (Bt mn) 25,754 Net profit (Bt mn) 1,927 EPS (Bt) 1.74 EPS growth (%) ‐ 2.93 Dividend (Bt) 0.75 BV (Bt) 11.85 FY Ended 31 Dec 2014 PER (x) 24.9 EV/EBITDA (x) 11.6 PBV (x) 3.6 Dividend yield (%) 1.73 ROE (%) 15.31 Net Gearing (%) 0.13
2015 27,739 2,153 1.94 11.70 1.00 13.01 2015 20.9 10.3 3.0 2.53 15.30 0.10
2016E 28,946 2,465 2.22 14.47 1.00 14.45 2016E 29.7 14.6 4.6 1.52 16.16 0.05
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
2017E 31,896 2,965 2.67 20.29 1.25 16.38 2017E 24.7 12.3 4.0 1.89 17.31 cash
2018E 35,662 3,542 3.19 19.48 1.50 18.64 2018E 20.7 10.6 3.5 2.27 18.21 cash
Figure 1: Quarterly earnings preview Profit and Loss (Bt mn) FY Ended 31 Dec Revenue Gross profit EBITDA Interest expense Other income Income tax Forex gain (loss) Other extraordinary Items Gn (Ls) from affiliates Net profit (loss) Normalized profit (loss) Reported EPS (THB) Gross margin (%) EBITDA margin (%) Net margin (%) Current ratio (x) Interest coverage (x) Debt / equity (x) BVPS (Bt) ROE (%)
2Q15 5,860 1,440 1,037 19 842 150 0 0 93 440 440 0.40 24.6 15.5 6.6 0.4 high 0.8 11.1 15.6
3Q15 6,031 1,443 970 20 860 90 0 0 90 397 397 0.36 23.9 14.1 5.8 0.5 high 0.8 11.7 15.7
4Q15 7,258 1,789 1,326 22 1,026 151 0 49 151 701 652 0.63 24.6 16.0 8.5 0.5 high 0.9 12.1 16.4
1Q16 6,395 1,608 1,347 17 951 158 0 0 122 686 686 0.62 25.1 18.3 9.3 0.6 high 0.7 12.7 16.8
2Q16E % YoY % QoQ 1H15 1H16E % YoY 6,148 4.9 (3.9) 11,896 12,543 5.4 1,549 7.6 (3.6) 2,931 3,157 7.7 1,219 17.6 (9.5) 2,203 2,566 16.5 19 n.m. n.m. 37 35 (5) 946 12.4 (0.5) 1,691 1,897 12.2 134 (10.6) (15.1) 293 293 (0.1) 0 n.m. n.m. 0 0 n.m. 0 n.m. n.m. 0 0 n.m. 100 8 (18) 211 222 6 565 28.4 (17.7) 1,054 1,251 18.7 565 28.4 (17.7) 1,054 1,251 18.7 0.51 28.4 (17.7) 0.95 1.13 18.7 25.2 24.6 25.2 17.2 18.5 20.5 8.0 8.9 10.0 n.a. 0.4 n.a. high high high n.a. 0.8 n.a. n.a. 11.1 n.a. n.a. 15.6 n.a.
2016E 26,127 6,399 5,070 69 3,893 607 0 0 519 2,465 2,465 2.22 24.5 16.9 8.2 1.0 high 0.6 9.8 20.7
% YoY % YTD 3.7 48.0 3.8 49.3 12.7 50.6 (12.7) 51.0 8.8 48.7 13.6 48.2
15.0 14.5 17.2 14.5
42.8 50.8 50.8 50.8
Source: ROBINS and KTZMICO Research Figure 2: Quarterly same‐store‐sales growth SSSG
(Bt mn)
Total sales growth
Net profit (LHS)
800
30.0%
Sales growth %
NP growth %
140% 120%
700
25.0%
100%
600
20.0%
80%
500
15.0%
60%
400
10.0%
40%
300
Source: Company data, KT ZMICO Research
Source: KT ZMICO Research
Figure 4: Gross margin trend
Figure 5: Revenue from investments
Gross margin
Revenue from investments
(Bt mn)
26%
800
25%
Source: Company data, KT ZMICO Research
1Q16
1Q15
1Q14
1Q13
1Q12
1Q16
1Q15
22%
1Q14
200
1Q13
23%
1Q12
400
1Q11
24%
1Q11
600
Source: KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
4Q16E
1Q16 2Q16E
1Q15
-40% 1Q14
-20%
1Q13
0%
100
-10.0%
20%
200
1Q12
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16E
0.0%
1Q11
5.0%
-5.0%
Figure 3: Sales growth and net profit growth trends
Figure 6: PE and PBV bands
PE Band
P/BV Band (X)
(X)
8.0
50 +2 S.D.
7.0
+1 S.D.
6.0
40
+2 S.D. +1 S.D.
5.0
30
Avg.
Avg.
4.0 20
-1 S.D.
10
-2 S.D.
3.0
-1 S.D.
2.0 -2 S.D.
1.0
0
Source: Company data, KT ZMICO Research
Jan-16
Jan-15
Jan-14
Jan-13
Jan-12
Jan-10
Jan-16
Jan-15
Jan-14
Jan-13
Jan-12
Jan-11
Jan-10
Jan-11
0.0
-10
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, PACE, PLE, TPOLY, M‐CHAI. KT ZMICO is a co‐underwriter of ALT, EKH.
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 4 of 4
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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
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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
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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.
