Srisawad Power 1979
Srisawad Power 1979 Earnings Review
Buy (17E TP Bt57.00) Close Bt43.00
Finance & Securities February 22, 2017
Beat forecast/Below forecast/In line
Results slightly beat forecasts Results date: February 21, 2017 Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
2.390
3.022
KT ZMICO vs. consensus Share data
‐4.6%
‐8.3%
Reuters / Bloomberg
SAWAD.BK/SAWAD TB
Paid‐up Shares (m)
1,045.50
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
45.00/1,284.00
Foreign limit / actual (%)
49.00/22.87
52 week High / Low (Bt)
46.25/26.00
Avg. daily T/O (shares 000) NVDR (%)
5,908.00 7.55
Estimated free float (%)
47.63
Beta
1.24
URL
www.meebaanmeerod.com
CGR
Anti‐corruption
n.a.
Note: An executive of KT ZMICO Securities is also a member of SAWAD’s board. Prapharas Nonthapiboon Analyst, no 17836 [email protected] 66 (0) 2695‐5872
Among the top growth stocks in the financial sector We maintain our Buy rating for SAWAD. It should remain among the top growth stocks in the financial sector with outperforming earnings growth and ROE vs. financial peers over the next three years. We also expect SAWAD’s move to restructure as a holding company and acquire BFIT to post benefits in the longer run (expected in 2018 onwards). 4Q16 net profit 8‐10% above our forecast and the street estimate SAWAD’s 4Q16 net profit of Bt608mn (+53% YoY, +12% QoQ) was 8‐10% above our forecast (Bt554mn) and the street estimate (Bt565mn). The stronger‐than‐expected results were due mainly to lower‐than‐expected operating expenses and provision expenses given its better asset quality. 2016 net profit came in at Bt2.0bn (+50% YoY) The impressive 2016 results were backed mainly by robust loan growth of 51% YoY and non‐interest income growth of 38% YoY, thanks to its continuing branch expansion to 2,130 branches at end‐16 vs. 1,627 branches in 2015, with 503 new branches opened in 2016 vs. 568 new branches in 2015, respectively, beating the firm’s target of ~2,000 branches at end‐16. The interest spread was quite stable at 24.4%. NPLs continued to decline both YoY and QoQ Its asset quality remains manageable with the NPL ratio for 4Q16 declining to 3.6% of loans vs. 4.9% in 4Q15 and 4.5% in 3Q16 following its more stringent measures in lending, collection and the NPL control processes since late 2014. Moreover, the lower NPLs for 4Q16 should also be due partly to SAWAD’s policy to normally do bad loan write‐offs every 2Q and 4Q. Seeing ongoing progress in other businesses SAWAD purchased new NPLs and NPA worth a total of ~Bt1.86bn in 2016, including the latest purchase of NPLs and NPA (~Bt950mn) in 4Q16. Loans to the Myanmar market ended the year at ~Bt480mn after its first lending in Jun‐16. Note that SAWAD targets NPL/NPA purchases of ~Bt2.0bn/year for 2017‐18E and lending to the Myanmar market at Bt1.0‐1.5bn in 2017E. Announced stock dividend at 25:1 and cash dividend of 0.005/share SAWAD announced a cash dividend of 0.005/share and a stock dividend at the ratio of 25 existing shares: 1 stock dividend (equal to a dividend of 0.04/share). The X‐dividend and payment dates will be on 28 April and 19 May‐17, respectively. The additional shares (41.82mn shares) from the stock dividend allocation cause a share dilution effect of just 3.8%. Financials and Valuation FY Ended 31 Dec PPOP (Btm) Net profit (Btmn) EPS (Bt) EPS growth (%) BV (Bt) Dividend (Bt)
2014 1,043 855 0.85 11% 3.43 0.02
2015 1,504 1,336 1.31 53% 4.67 0.03
2016 2,167 2,005 1.92 46% 6.54 0.05
2017E 2,853 2,440 2.28 19% 8.52 0.06
2018E 3,575 3,038 2.77 21% 11.04 0.08
FY Ended 31 Dec PER (x) PBV (x) Dividend yield (%) ROE (%)
2014 50.31 12.53 0.05 37%
2015 32.83 9.20 0.07 33%
2016 22.43 6.57 0.10 35%
2017E 18.88 5.05 0.14 31%
2018E 15.55 3.89 0.18 29%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
Figure 1: 4Q16 and 2016 Earnings Results Statement of comprehensive income (Btmn) Fiscal Year‐Ended Dec.
4Q15
3Q16
4Q16
% YoY % QoQ
Interest Income
805
1,046
1,186
47%
Interest Expenses
76
97
108
41%
Net Interest Income
729
949
1,079
Non Interest Income
280
358
360
Operating Income
1,009
1,308
1,439
2015
2016
% YoY
13% 2,814
4,008
42%
11% 281
369
31%
48%
14% 2,534
3,639
44%
29%
1% 963
1,327
38%
43%
10% 3,496
4,967
42%
Operating Expenses
485
590
654
35%
11% 1,678
2,298
37%
Operating Profit Provision expenses (Reversal)
524
717
785
50%
9% 1,818
2,669
47%
48
38
24
‐49%
‐36% 168
158
‐6%
Taxes
79
136
151
92%
11% 314
502
60%
Net Profit
397
543
608
53%
12% 1,336
2,005
50%
PPOP
446
582
634
42%
9% 1,504
2,167
44%
EPS (Bt)
0.39
0.52
0.58
49%
12% 1.31
1.92
46%
4Q15
3Q16
4Q16
2015
2016
Gross NPLs (Btmn)
562
698
635
562
635
Gross NPLs/Loans
4.86%
4.46%
3.63%
4.86%
3.63%
Loan Loss Reserve/NPLs
87.5%
63.8%
61.3%
63.3%
61.3%
Loan Loss Reserve/Loans
3.1%
2.8%
2.2%
3.1%
2.2%
34.9%
32.4%
30.8%
34.9%
30.8%
Key Statistics and Ratios (%)
Equity/Asset Loan to borrowing ratio
139.6%
Debt to equity ratio (x)
1.9
Cost to Income
127.4% 2.1
48.1%
45.1%
120.9%
139.6%
2.2
1.9
45.4%
48.0%
120.9% 2.2 46.3%
Non Interest Income/Total Income
27.8%
27.4%
25.0%
27.5%
26.7%
Interest Spread
25.3%
24.9%
25.4%
24.7%
24.4%
Loan Growth YoY
48.0%
48.6%
51.0%
48.0%
51.0%
9.8%
11.7%
11.6%
Loan Growth QoQ Source: KTZMICO Research
Figure 2: SAWAD's P/BV band and sensitivity of market prices based on P/BV at different standard deviation levels (X)
2017E
+3.0 S.D. +2.5 S.D. +2.0 S.D. +1.5 S.D. +1.0 S.D. +0.5 S.D.
Avg.
Feb-17
Oct-16
Dec-16
Aug-16
Jun-16
Jan-16
Mar-16
Sep-15
Source: Bloomberg, KT ZMICO Research
Nov-15
Jul-15
Mar-15
May-15
Jan-15
Sep-14
Nov-14
Jul-14
-0.5 S.D. -1 S.D. -1.5 S.D. -2.0 S.D.
May-14
12.0 11.0 10.0 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0
Implied PBV (x) market price
p Downside to current price
(Bt)
(%)
+2.0SD
9.4
80
86
+1.5SD
8.8
75
72
+1.0SD
8.1
69
59
+0.5SD
7.4
63
46
Average
6.7
57
32
-0.5SD
6.0
51
19
-1.0SD
5.4
46
5
-1.5SD
4.7
40
-8
-2.0SD
4.0
34
-21
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
Figure 3: SAWAD's PER band and sensitivity of market prices based on PER at different standard deviation levels (X) 45
2017E
Downside to current price
40
+3.0 S.D.
(Bt)
(%)
35
+2.0 S.D.
+2.0SD
33.6
76
77
30
+1.0S.D.
+1.5SD
31.2
71
64
25
Avg.
+1.0SD
28.8
66
52
20
-1 S.D.
+0.5SD
26.5
60
39
Average
24.1
55
27
-0.5SD
21.7
49
14
-1.0SD
19.3
44
2
-1.5SD
17.0
39
-11
-2.0SD
14.6
33
-23
Source: Bloomberg, KT ZMICO Research
Feb-17
Dec-16
Oct-16
Aug-16
Jun-16
Jan-16
Mar-16
Nov-15
Sep-15
Jul-15
May-15
Jan-15
Mar-15
Nov-14
Sep-14
May-14
10
Jul-14
-2 S.D.
15
Implied PER (x) market price
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, TFD. KT ZMICO is a co underwriter of RPH. 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
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
Buy (17E TP Bt57.00) Close Bt43.00
Finance & Securities February 22, 2017
Beat forecast/Below forecast/In line
Results slightly beat forecasts Results date: February 21, 2017 Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
2.390
3.022
KT ZMICO vs. consensus Share data
‐4.6%
‐8.3%
Reuters / Bloomberg
SAWAD.BK/SAWAD TB
Paid‐up Shares (m)
1,045.50
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
45.00/1,284.00
Foreign limit / actual (%)
49.00/22.87
52 week High / Low (Bt)
46.25/26.00
Avg. daily T/O (shares 000) NVDR (%)
5,908.00 7.55
Estimated free float (%)
47.63
Beta
1.24
URL
www.meebaanmeerod.com
CGR
Anti‐corruption
n.a.
Note: An executive of KT ZMICO Securities is also a member of SAWAD’s board. Prapharas Nonthapiboon Analyst, no 17836 [email protected] 66 (0) 2695‐5872
Among the top growth stocks in the financial sector We maintain our Buy rating for SAWAD. It should remain among the top growth stocks in the financial sector with outperforming earnings growth and ROE vs. financial peers over the next three years. We also expect SAWAD’s move to restructure as a holding company and acquire BFIT to post benefits in the longer run (expected in 2018 onwards). 4Q16 net profit 8‐10% above our forecast and the street estimate SAWAD’s 4Q16 net profit of Bt608mn (+53% YoY, +12% QoQ) was 8‐10% above our forecast (Bt554mn) and the street estimate (Bt565mn). The stronger‐than‐expected results were due mainly to lower‐than‐expected operating expenses and provision expenses given its better asset quality. 2016 net profit came in at Bt2.0bn (+50% YoY) The impressive 2016 results were backed mainly by robust loan growth of 51% YoY and non‐interest income growth of 38% YoY, thanks to its continuing branch expansion to 2,130 branches at end‐16 vs. 1,627 branches in 2015, with 503 new branches opened in 2016 vs. 568 new branches in 2015, respectively, beating the firm’s target of ~2,000 branches at end‐16. The interest spread was quite stable at 24.4%. NPLs continued to decline both YoY and QoQ Its asset quality remains manageable with the NPL ratio for 4Q16 declining to 3.6% of loans vs. 4.9% in 4Q15 and 4.5% in 3Q16 following its more stringent measures in lending, collection and the NPL control processes since late 2014. Moreover, the lower NPLs for 4Q16 should also be due partly to SAWAD’s policy to normally do bad loan write‐offs every 2Q and 4Q. Seeing ongoing progress in other businesses SAWAD purchased new NPLs and NPA worth a total of ~Bt1.86bn in 2016, including the latest purchase of NPLs and NPA (~Bt950mn) in 4Q16. Loans to the Myanmar market ended the year at ~Bt480mn after its first lending in Jun‐16. Note that SAWAD targets NPL/NPA purchases of ~Bt2.0bn/year for 2017‐18E and lending to the Myanmar market at Bt1.0‐1.5bn in 2017E. Announced stock dividend at 25:1 and cash dividend of 0.005/share SAWAD announced a cash dividend of 0.005/share and a stock dividend at the ratio of 25 existing shares: 1 stock dividend (equal to a dividend of 0.04/share). The X‐dividend and payment dates will be on 28 April and 19 May‐17, respectively. The additional shares (41.82mn shares) from the stock dividend allocation cause a share dilution effect of just 3.8%. Financials and Valuation FY Ended 31 Dec PPOP (Btm) Net profit (Btmn) EPS (Bt) EPS growth (%) BV (Bt) Dividend (Bt)
2014 1,043 855 0.85 11% 3.43 0.02
2015 1,504 1,336 1.31 53% 4.67 0.03
2016 2,167 2,005 1.92 46% 6.54 0.05
2017E 2,853 2,440 2.28 19% 8.52 0.06
2018E 3,575 3,038 2.77 21% 11.04 0.08
FY Ended 31 Dec PER (x) PBV (x) Dividend yield (%) ROE (%)
2014 50.31 12.53 0.05 37%
2015 32.83 9.20 0.07 33%
2016 22.43 6.57 0.10 35%
2017E 18.88 5.05 0.14 31%
2018E 15.55 3.89 0.18 29%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
Figure 1: 4Q16 and 2016 Earnings Results Statement of comprehensive income (Btmn) Fiscal Year‐Ended Dec.
4Q15
3Q16
4Q16
% YoY % QoQ
Interest Income
805
1,046
1,186
47%
Interest Expenses
76
97
108
41%
Net Interest Income
729
949
1,079
Non Interest Income
280
358
360
Operating Income
1,009
1,308
1,439
2015
2016
% YoY
13% 2,814
4,008
42%
11% 281
369
31%
48%
14% 2,534
3,639
44%
29%
1% 963
1,327
38%
43%
10% 3,496
4,967
42%
Operating Expenses
485
590
654
35%
11% 1,678
2,298
37%
Operating Profit Provision expenses (Reversal)
524
717
785
50%
9% 1,818
2,669
47%
48
38
24
‐49%
‐36% 168
158
‐6%
Taxes
79
136
151
92%
11% 314
502
60%
Net Profit
397
543
608
53%
12% 1,336
2,005
50%
PPOP
446
582
634
42%
9% 1,504
2,167
44%
EPS (Bt)
0.39
0.52
0.58
49%
12% 1.31
1.92
46%
4Q15
3Q16
4Q16
2015
2016
Gross NPLs (Btmn)
562
698
635
562
635
Gross NPLs/Loans
4.86%
4.46%
3.63%
4.86%
3.63%
Loan Loss Reserve/NPLs
87.5%
63.8%
61.3%
63.3%
61.3%
Loan Loss Reserve/Loans
3.1%
2.8%
2.2%
3.1%
2.2%
34.9%
32.4%
30.8%
34.9%
30.8%
Key Statistics and Ratios (%)
Equity/Asset Loan to borrowing ratio
139.6%
Debt to equity ratio (x)
1.9
Cost to Income
127.4% 2.1
48.1%
45.1%
120.9%
139.6%
2.2
1.9
45.4%
48.0%
120.9% 2.2 46.3%
Non Interest Income/Total Income
27.8%
27.4%
25.0%
27.5%
26.7%
Interest Spread
25.3%
24.9%
25.4%
24.7%
24.4%
Loan Growth YoY
48.0%
48.6%
51.0%
48.0%
51.0%
9.8%
11.7%
11.6%
Loan Growth QoQ Source: KTZMICO Research
Figure 2: SAWAD's P/BV band and sensitivity of market prices based on P/BV at different standard deviation levels (X)
2017E
+3.0 S.D. +2.5 S.D. +2.0 S.D. +1.5 S.D. +1.0 S.D. +0.5 S.D.
Avg.
Feb-17
Oct-16
Dec-16
Aug-16
Jun-16
Jan-16
Mar-16
Sep-15
Source: Bloomberg, KT ZMICO Research
Nov-15
Jul-15
Mar-15
May-15
Jan-15
Sep-14
Nov-14
Jul-14
-0.5 S.D. -1 S.D. -1.5 S.D. -2.0 S.D.
May-14
12.0 11.0 10.0 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0
Implied PBV (x) market price
p Downside to current price
(Bt)
(%)
+2.0SD
9.4
80
86
+1.5SD
8.8
75
72
+1.0SD
8.1
69
59
+0.5SD
7.4
63
46
Average
6.7
57
32
-0.5SD
6.0
51
19
-1.0SD
5.4
46
5
-1.5SD
4.7
40
-8
-2.0SD
4.0
34
-21
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
Figure 3: SAWAD's PER band and sensitivity of market prices based on PER at different standard deviation levels (X) 45
2017E
Downside to current price
40
+3.0 S.D.
(Bt)
(%)
35
+2.0 S.D.
+2.0SD
33.6
76
77
30
+1.0S.D.
+1.5SD
31.2
71
64
25
Avg.
+1.0SD
28.8
66
52
20
-1 S.D.
+0.5SD
26.5
60
39
Average
24.1
55
27
-0.5SD
21.7
49
14
-1.0SD
19.3
44
2
-1.5SD
17.0
39
-11
-2.0SD
14.6
33
-23
Source: Bloomberg, KT ZMICO Research
Feb-17
Dec-16
Oct-16
Aug-16
Jun-16
Jan-16
Mar-16
Nov-15
Sep-15
Jul-15
May-15
Jan-15
Mar-15
Nov-14
Sep-14
May-14
10
Jul-14
-2 S.D.
15
Implied PER (x) market price
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, TFD. KT ZMICO is a co underwriter of RPH. 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
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
