SC Asset Corporation - Global Alliance Partners
SC Asset Corporation Underperform (17E TP Bt3.50)
Earnings Review
Close Bt3.44
Property Development November 15, 2016
Beat forecast /Below forecast/In line
3Q16 net profit declined YoY and QoQ Price Performance (%)
Source: SET Smart
FY16
FY17
Consensus EPS (Bt)
0.485
0.462
KT ZMICO vs. consensus Share data
‐3.1%
‐4.8%
Reuters / Bloomberg
SC.BK/SC TB
Paid‐up Shares (m)
4,179.33
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
14.00/405.00
Foreign limit / actual (%)
49.00/4.57
52 week High / Low (Bt)
3.74/2.62
Avg. daily T/O (shares 000) NVDR (%) Estimated free float (%)
3,675.00
FY Ended 31 Dec
2013
2014
2015
2016E
2017E
2.51
Revenues (Btmn)
10,031
12,601
14,050
14,915
14,962
Net profit (Btmn)
1,082
1,558
1,895
1,995
1,838
0.29
0.42
0.45
0.47
0.44
(12.1)
44.8
8.0
4.7
(7.8)
0.28
0.40
0.43
0.47
0.44
(11.8)
44.4
7.1
10.1
(7.8)
34.02
Beta
0.77
URL
www.scasset.com
CGR
Maintain Underperform with the 17E TP at Bt3.5 We maintain Underperform with the 17E TP at Bt3.5. We expect 4Q16E to be the lowest profit of the year and the 2017E earnings to decline YoY due to a lack of condo backlog to be transferred in the next year. A positive point that will support SC’s share price in 2H16E is an interesting dividend yield, which we expect to be around 5.2% this year. 3Q16 net profit declined YoY and QoQ SC’s 3Q16 net profit was in line at Bt346mn (‐15.8% YoY, ‐61.2% QoQ). Such a decrease both YoY and QoQ was due to lower transfers of Bt2.8bn (‐3.5% YoY, ‐43.2% QoQ). The average GPM was at 35.7% (our estimate was 36.2%). The SG&A expense‐to‐revenue ratio was 21.1%, which was higher than our estimate at 20.2%. Interest expenses were only Bt17mn, 45% below our forecast. Maintain 2016‐17E net profit SC’s 9M16 net profit was 86% of our 2016E forecast at Bt1.99bn (+5.2% YoY), which we maintain. This is because we expect 4Q16E net profit to decrease QoQ as SC has a lower backlog of condos to transfer in the last quarter of the year. We also maintain our 2017E net profit at Bt1.84bn (‐ 7.8% YoY). Oct‐16 presales increased from both low‐rise and condo projects Oct‐16 presales were Bt1.85bn, increasing from Bt577mn in Sep‐16 backed by new project launches. The majority of presales were from condos at Bt1.35bn, boosted by the soft launch of 28 Chidlom (Bt8bn, 14% sold), and the rest were from low‐rise presales of Bt500mn, increasing from Bt426mn in Sep‐16. Financials and Valuation
EPS (Bt) EPS growth (%) Core EPS (Bt) Core EPS growth (%)
Anti‐corruption
Level 2 (Declared)
Dividend (Bt)
0.12
0.21
0.18
0.18
0.18
BV (Bt)
2.82
3.14
3.16
3.44
3.70
FY Ended 31 Dec
2013
2014
2015
2016E
2017E
PER (x)
11.9
8.2
7.6
7.2
7.9
Normalized PER (x)
12.3
8.5
8.0
7.2
7.9
EV/EBITDA (x)
17.7
11.7
10.6
9.8
11.4 0.9
Worarat Powpaka
PBV (x)
1.2
1.1
1.1
1.0
Analyst, no. 17992
Dividend yield (%)
3.5
6.0
5.2
5.2
5.1
[email protected] 66 (0) 2624‐6248
ROE (%)
10.3
13.4
14.3
13.8
11.8
Net gearing (%)
55.4
53.9
51.7
47.1
49.1
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
Figure 1: Quarterly earnings review Profit and Loss (Btmn)
FY Ended 31 Dec
3Q15
2Q16
3Q16
% YoY
% QoQ
9M16
% YoY
2016E
% YoY
Revenue from project sales Total revenue Gross profit
2,911 3,117 1,184
4,949 5,142 1,872
2,809 2,999 1,072
(3.5) (3.8) (9.5)
(43.2) (41.7) (42.7)
10,893 11,463 4,207
29.5 26.9 26.3
14,092 14,915 5,463
6.5 6.2 6.2
YTD (% 2016E) 77.3 76.9 77.0
EBITDA
580
1,175
482
(16.9)
(59.0)
2,315
48.1
2,759
7.3
83.9
Interest expense
(40)
(28)
(17)
(58.6)
(41.2)
(84)
(42.6)
(156)
(16.5)
53.6
11
7
10
(9.9)
40.4
20
(28.2)
35
(13.8)
58.2
(106)
(225)
(87)
(18.1)
(61.3)
(430)
52.2
(499)
2.9
86.3
411
890
346
(15.8)
(61.2)
1,705
59.6
1,995
5.2
85.5
Other income Income tax Net profit (loss)
Core net profit (loss)
411
890
346
(15.8)
(61.2)
1,705
59.6
1,995
10.7
85.5
Reported EPS (THB)
0.10
0.21
0.08
(15.8)
(61.2)
0.41
59.6
0.47
4.7
85.9
Core EPS (THB)
0.10
0.21
0.08
(15.8)
(61.2)
0.41
56.7
0.47
10.1
85.9
Gross margin – project sales (%)
36.0
35.4
33.8
35.3
35.0
Gross margin ‐ overall (%)
38.0
36.4
35.7
36.7
36.6
EBITDA margin (%)
18.6
22.9
16.1
20.2
18.5
Net margin (%)
13.2
17.3
11.5
14.9
13.4
Current ratio (x)
2.2
2.7
2.4
2.4
2.0
Interest coverage (x)
13.9
40.4
27.0
26.5
17.0
Debt / equity (x)
1.5
1.3
1.3
1.3
1.2
BVPS (Bt)
2.97
3.31
3.39
3.39
3.4
ROE (%)
13.8
18.9
18.1
18.1
13.8
Source: SC, KT ZMICO Research
Figure 2: Presales
Figure 3: Distribution of backlog as of 30 Jun 16
Btmn 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 ‐
2016 1,559
2018
Low rise
Condo
10M16
10M15
4Q16
3Q16
2Q16
1Q16
4Q15
3Q15
2Q15
1Q15
4Q14
3Q14
2Q14
1Q14
4Q13
3Q13
2Q13
1Q13
2,858
Backlog Bt5,196mn
2017 779
Source: SC, KT ZMICO Research
Source: SC, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
FINANCIAL TABLE PROFIT & LOSS (Btmn) 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 Net profit Reported EPS Fully diluted EPS Core net profit Core EPS Dividend (Bt) BALANCE SHEET (Btmn) 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 Total liab. & shareholder equity CASH FLOW (Btmn) 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 (%)
2013 10,031 (6,465) 3,566 (2,255) 1,410 85 1,325 (94) 14 1,273 (192) 0 42 0 1,082 0.29 0.29 1,039 0.28 0.12
2014 12,601 (8,023) 4,577 (2,534) 2,159 90 2,069 (176) 27 1,959 (400) 0 65 0 1,558 0.42 0.42 1,493 0.40 0.21
2015 14,050 (8,905) 5,145 (2,712) 2,571 98 2,474 (187) 41 2,380 (485) 0 93 0 1,895 0.45 0.45 1,802 0.43 0.18
2016E 14,915 (9,451) 5,463 (2,849) 2,759 110 2,649 (156) 35 2,493 (499) 0 0 0 1,995 0.47 0.47 1,995 0.47 0.18
2017E 14,962 (9,652) 5,311 (2,898) 2,559 111 2,448 (150) 35 2,298 (460) 0 0 0 1,838 0.44 0.44 1,838 0.44 0.18
2013 835 63 0 6,570 19,355 26,993 7,068 5,993 16,466 3,713 10,527 26,993
2014 1,156 70 0 6,859 20,671 28,934 8,220 5,373 17,298 3,715 11,636 28,934
2015 1,203 67 0 7,059 22,240 30,957 7,582 6,563 17,732 4,179 13,225 30,957
2016E 200 82 0 7,127 23,620 31,430 9,134 3,722 16,966 4,179 14,464 31,430
2017E 200 82 0 7,213 26,810 34,709 13,027 1,998 19,163 4,179 15,546 34,709
2013 1,082 (703) 85 (2,817) (2,353) 55 0 55 2,481 9 (107) 0 2,383 84 (1,764) (0.47)
2014 1,558 (405) 90 (915) 328 (668) 0 (668) 596 2 (445) 0 153 (186) 574 0.15
2015 1,895 (459) 98 (1,324) 210 (147) 0 (147) 497 0 (297) 0 199 262 299 0.07
2016E 1,995 13 110 (971) 1,146 845 0 845 (1,288) 0 (756) 0 (2,044) (53) 1,024 0.24
2017E 1,838 14 111 (3,235) (1,271) 3,758 0 3,758 2,169 0 (756) 0 1,413 3,899 (1,365) (0.32)
2013 20.0 (1.7) (12.1) 35.5 14.1 13.2 10.8 10.4 15.1
2014 25.6 53.2 44.8 36.3 17.1 16.4 12.4 11.9 20.4
2015 11.5 19.1 8.0 36.6 18.3 17.6 13.5 12.8 20.4
2016E 6.2 7.3 4.7 36.6 18.5 17.8 13.4 13.4 20.0
2017E 0.3 (7.2) (7.8) 35.5 17.1 16.4 12.3 12.3 20.0
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, TPOLY, M‐CHAI, TFD, SUTHA, CI. Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD) Excellent (scores: 90 ‐ 100) Satisfactory (scores: 60 – 69) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
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
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 Bt3.44
Property Development November 15, 2016
Beat forecast /Below forecast/In line
3Q16 net profit declined YoY and QoQ Price Performance (%)
Source: SET Smart
FY16
FY17
Consensus EPS (Bt)
0.485
0.462
KT ZMICO vs. consensus Share data
‐3.1%
‐4.8%
Reuters / Bloomberg
SC.BK/SC TB
Paid‐up Shares (m)
4,179.33
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
14.00/405.00
Foreign limit / actual (%)
49.00/4.57
52 week High / Low (Bt)
3.74/2.62
Avg. daily T/O (shares 000) NVDR (%) Estimated free float (%)
3,675.00
FY Ended 31 Dec
2013
2014
2015
2016E
2017E
2.51
Revenues (Btmn)
10,031
12,601
14,050
14,915
14,962
Net profit (Btmn)
1,082
1,558
1,895
1,995
1,838
0.29
0.42
0.45
0.47
0.44
(12.1)
44.8
8.0
4.7
(7.8)
0.28
0.40
0.43
0.47
0.44
(11.8)
44.4
7.1
10.1
(7.8)
34.02
Beta
0.77
URL
www.scasset.com
CGR
Maintain Underperform with the 17E TP at Bt3.5 We maintain Underperform with the 17E TP at Bt3.5. We expect 4Q16E to be the lowest profit of the year and the 2017E earnings to decline YoY due to a lack of condo backlog to be transferred in the next year. A positive point that will support SC’s share price in 2H16E is an interesting dividend yield, which we expect to be around 5.2% this year. 3Q16 net profit declined YoY and QoQ SC’s 3Q16 net profit was in line at Bt346mn (‐15.8% YoY, ‐61.2% QoQ). Such a decrease both YoY and QoQ was due to lower transfers of Bt2.8bn (‐3.5% YoY, ‐43.2% QoQ). The average GPM was at 35.7% (our estimate was 36.2%). The SG&A expense‐to‐revenue ratio was 21.1%, which was higher than our estimate at 20.2%. Interest expenses were only Bt17mn, 45% below our forecast. Maintain 2016‐17E net profit SC’s 9M16 net profit was 86% of our 2016E forecast at Bt1.99bn (+5.2% YoY), which we maintain. This is because we expect 4Q16E net profit to decrease QoQ as SC has a lower backlog of condos to transfer in the last quarter of the year. We also maintain our 2017E net profit at Bt1.84bn (‐ 7.8% YoY). Oct‐16 presales increased from both low‐rise and condo projects Oct‐16 presales were Bt1.85bn, increasing from Bt577mn in Sep‐16 backed by new project launches. The majority of presales were from condos at Bt1.35bn, boosted by the soft launch of 28 Chidlom (Bt8bn, 14% sold), and the rest were from low‐rise presales of Bt500mn, increasing from Bt426mn in Sep‐16. Financials and Valuation
EPS (Bt) EPS growth (%) Core EPS (Bt) Core EPS growth (%)
Anti‐corruption
Level 2 (Declared)
Dividend (Bt)
0.12
0.21
0.18
0.18
0.18
BV (Bt)
2.82
3.14
3.16
3.44
3.70
FY Ended 31 Dec
2013
2014
2015
2016E
2017E
PER (x)
11.9
8.2
7.6
7.2
7.9
Normalized PER (x)
12.3
8.5
8.0
7.2
7.9
EV/EBITDA (x)
17.7
11.7
10.6
9.8
11.4 0.9
Worarat Powpaka
PBV (x)
1.2
1.1
1.1
1.0
Analyst, no. 17992
Dividend yield (%)
3.5
6.0
5.2
5.2
5.1
[email protected] 66 (0) 2624‐6248
ROE (%)
10.3
13.4
14.3
13.8
11.8
Net gearing (%)
55.4
53.9
51.7
47.1
49.1
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
Figure 1: Quarterly earnings review Profit and Loss (Btmn)
FY Ended 31 Dec
3Q15
2Q16
3Q16
% YoY
% QoQ
9M16
% YoY
2016E
% YoY
Revenue from project sales Total revenue Gross profit
2,911 3,117 1,184
4,949 5,142 1,872
2,809 2,999 1,072
(3.5) (3.8) (9.5)
(43.2) (41.7) (42.7)
10,893 11,463 4,207
29.5 26.9 26.3
14,092 14,915 5,463
6.5 6.2 6.2
YTD (% 2016E) 77.3 76.9 77.0
EBITDA
580
1,175
482
(16.9)
(59.0)
2,315
48.1
2,759
7.3
83.9
Interest expense
(40)
(28)
(17)
(58.6)
(41.2)
(84)
(42.6)
(156)
(16.5)
53.6
11
7
10
(9.9)
40.4
20
(28.2)
35
(13.8)
58.2
(106)
(225)
(87)
(18.1)
(61.3)
(430)
52.2
(499)
2.9
86.3
411
890
346
(15.8)
(61.2)
1,705
59.6
1,995
5.2
85.5
Other income Income tax Net profit (loss)
Core net profit (loss)
411
890
346
(15.8)
(61.2)
1,705
59.6
1,995
10.7
85.5
Reported EPS (THB)
0.10
0.21
0.08
(15.8)
(61.2)
0.41
59.6
0.47
4.7
85.9
Core EPS (THB)
0.10
0.21
0.08
(15.8)
(61.2)
0.41
56.7
0.47
10.1
85.9
Gross margin – project sales (%)
36.0
35.4
33.8
35.3
35.0
Gross margin ‐ overall (%)
38.0
36.4
35.7
36.7
36.6
EBITDA margin (%)
18.6
22.9
16.1
20.2
18.5
Net margin (%)
13.2
17.3
11.5
14.9
13.4
Current ratio (x)
2.2
2.7
2.4
2.4
2.0
Interest coverage (x)
13.9
40.4
27.0
26.5
17.0
Debt / equity (x)
1.5
1.3
1.3
1.3
1.2
BVPS (Bt)
2.97
3.31
3.39
3.39
3.4
ROE (%)
13.8
18.9
18.1
18.1
13.8
Source: SC, KT ZMICO Research
Figure 2: Presales
Figure 3: Distribution of backlog as of 30 Jun 16
Btmn 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 ‐
2016 1,559
2018
Low rise
Condo
10M16
10M15
4Q16
3Q16
2Q16
1Q16
4Q15
3Q15
2Q15
1Q15
4Q14
3Q14
2Q14
1Q14
4Q13
3Q13
2Q13
1Q13
2,858
Backlog Bt5,196mn
2017 779
Source: SC, KT ZMICO Research
Source: SC, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
FINANCIAL TABLE PROFIT & LOSS (Btmn) 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 Net profit Reported EPS Fully diluted EPS Core net profit Core EPS Dividend (Bt) BALANCE SHEET (Btmn) 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 Total liab. & shareholder equity CASH FLOW (Btmn) 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 (%)
2013 10,031 (6,465) 3,566 (2,255) 1,410 85 1,325 (94) 14 1,273 (192) 0 42 0 1,082 0.29 0.29 1,039 0.28 0.12
2014 12,601 (8,023) 4,577 (2,534) 2,159 90 2,069 (176) 27 1,959 (400) 0 65 0 1,558 0.42 0.42 1,493 0.40 0.21
2015 14,050 (8,905) 5,145 (2,712) 2,571 98 2,474 (187) 41 2,380 (485) 0 93 0 1,895 0.45 0.45 1,802 0.43 0.18
2016E 14,915 (9,451) 5,463 (2,849) 2,759 110 2,649 (156) 35 2,493 (499) 0 0 0 1,995 0.47 0.47 1,995 0.47 0.18
2017E 14,962 (9,652) 5,311 (2,898) 2,559 111 2,448 (150) 35 2,298 (460) 0 0 0 1,838 0.44 0.44 1,838 0.44 0.18
2013 835 63 0 6,570 19,355 26,993 7,068 5,993 16,466 3,713 10,527 26,993
2014 1,156 70 0 6,859 20,671 28,934 8,220 5,373 17,298 3,715 11,636 28,934
2015 1,203 67 0 7,059 22,240 30,957 7,582 6,563 17,732 4,179 13,225 30,957
2016E 200 82 0 7,127 23,620 31,430 9,134 3,722 16,966 4,179 14,464 31,430
2017E 200 82 0 7,213 26,810 34,709 13,027 1,998 19,163 4,179 15,546 34,709
2013 1,082 (703) 85 (2,817) (2,353) 55 0 55 2,481 9 (107) 0 2,383 84 (1,764) (0.47)
2014 1,558 (405) 90 (915) 328 (668) 0 (668) 596 2 (445) 0 153 (186) 574 0.15
2015 1,895 (459) 98 (1,324) 210 (147) 0 (147) 497 0 (297) 0 199 262 299 0.07
2016E 1,995 13 110 (971) 1,146 845 0 845 (1,288) 0 (756) 0 (2,044) (53) 1,024 0.24
2017E 1,838 14 111 (3,235) (1,271) 3,758 0 3,758 2,169 0 (756) 0 1,413 3,899 (1,365) (0.32)
2013 20.0 (1.7) (12.1) 35.5 14.1 13.2 10.8 10.4 15.1
2014 25.6 53.2 44.8 36.3 17.1 16.4 12.4 11.9 20.4
2015 11.5 19.1 8.0 36.6 18.3 17.6 13.5 12.8 20.4
2016E 6.2 7.3 4.7 36.6 18.5 17.8 13.4 13.4 20.0
2017E 0.3 (7.2) (7.8) 35.5 17.1 16.4 12.3 12.3 20.0
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, TPOLY, M‐CHAI, TFD, SUTHA, CI. Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD) Excellent (scores: 90 ‐ 100) Satisfactory (scores: 60 – 69) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
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
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
