Head of Research, Krungthai XSpring

Waraporn Wiboonkanarak

Head of Research

A full service Thai brokerage

Krungthai XSpring

Krungthai XSpring is a full service broker. The company provides a wide range of investment services such as Securities Brokerage, Derivative Agent Business, Securities Borrowing and Lending, Securities Trading, Underwriting, Financial Advisory, Wealth Advisory, Private Fund Management and International Markets Securities Trading. 

In terms of credibility, Fitch Ratings has assigned Krunghtai XSpring a long-term rating of AA- and a national short-term rating of F1+ with stable outlook.

Equity Bottom-Up

Thai Foods Group Public Company Limited / Equity Bottom-Up

Thaifoods Group Public Company Limited is the manufacturer and processor of poultry and swine products. The Company's business involves hatcheries, contract farming, raw chicken meat processing for export, and domestic distribution. Thaifoods Group operates in Southeast Asia.

Thai Foods Group Public Company Limited (TFG TB)

<ul><li>KTX maintains an Outperform rating, with a new fair value of Bt4.97 vs. Bt4.0 previously, based on the earnings yield and a required return of 9.2%, reflecting the target PER of 11x.</li><li>The valuation metrics suggest more attractive fundamentals and very limited tactical downside risk (vs. undervalued and a neutral tactical view previously).</li><li>But the long-term earnings prospects have been revised to steady, with an expected CAGR of 8%.</li></ul>

KTX maintains an Outperform rating, with a new fair value of Bt4.97 vs. Bt4.0 previously, based on the earnings yield and a required return of 9.2%, reflecting the target PER of 11x.The valuation metrics suggest more attractive fundamentals and very limited tactical downside risk (vs. undervalued and a neutral tactical view previously).But the long-term earnings prospects have been revised to steady, with an expected CAGR of 8%.

Thaifoods Group - Solid 3Q24E Earnings; 2024-26E Core Profit Forecasts Revised Up

Thai Vegetable Oil Public Company Limited produces and markets soybean cooking oil under its A-ngoon brand name.  Additionally, the Company produced other soybean products including soymeal, full-fat soy, cooked and un-extracted soybeanseed, and lecithin.  Its products are also used in industrial applications such as the production of paint or canned food.

<ul><li>We initiate our coverage on TVO with a Neutral rating and a 12- month FV of Bt22.90, based on a required return of 7.45%.</li><li>Our valuation metrics indicate that the current valuation is neutral, and the earnings growth is strong, while the tactical parameters show limited upside.</li><li>TVO should offer attractive dividend yields of 6.6% and 4.3% in 2024-25E, respectively, higher than peers’ averages of 3.4% and 4.2%, respectively.</li></ul>

We initiate our coverage on TVO with a Neutral rating and a 12- month FV of Bt22.90, based on a required return of 7.45%.Our valuation metrics indicate that the current valuation is neutral, and the earnings growth is strong, while the tactical parameters show limited upside.TVO should offer attractive dividend yields of 6.6% and 4.3% in 2024-25E, respectively, higher than peers’ averages of 3.4% and 4.2%, respectively.

Thai Vegetable Oil - Short Term Positive but Challenge in Long Term

Sansiri Public Company Limited develops real estate projects for sales and rentals.  Its projects include resort condominiums, residential and office buildings.  The Company also provides property and project management services.

<ul><li>We maintain an Outperform rating on SIRI, holding a positive view on the sale of hotel management rights to the Hyatt Group, which is favorable to both the firm’s earnings and financial position.</li><li>SIRI's fundamental valuation is attractive, while the tactical factors are viewed neutrally. This should help offset the slower EPS growth expected due to the high base in 2023.</li><li>The 1H24 dividend yield is 4.0% from the DPS of Bt0.07, with the  XD date scheduled for August 28, 2024.</li></ul>

We maintain an Outperform rating on SIRI, holding a positive view on the sale of hotel management rights to the Hyatt Group, which is favorable to both the firm’s earnings and financial position.SIRI's fundamental valuation is attractive, while the tactical factors are viewed neutrally. This should help offset the slower EPS growth expected due to the high base in 2023.The 1H24 dividend yield is 4.0% from the DPS of Bt0.07, with the  XD date scheduled for August 28, 2024.

Sansiri - Hyatt Acquires Standard International

R&B Food Supply Public Company Limited operates as a food company. The Company manufactures breadcrumbs. R&B Food Supply serves customers in Thailand.

<ul><li>Weak sales growth has negatively impacted profitability, leading us to revise down our earnings projections by 33-40%.</li><li>As a result, earnings growth over the next three years is expected to remain stable, signaling that the long-term growth outlook is no longer compelling.</li><li>We are waiting for positive developments in the recovery of high-margin product sales to offset the declining sales in China.</li></ul>

Weak sales growth has negatively impacted profitability, leading us to revise down our earnings projections by 33-40%.As a result, earnings growth over the next three years is expected to remain stable, signaling that the long-term growth outlook is no longer compelling.We are waiting for positive developments in the recovery of high-margin product sales to offset the declining sales in China.

R&B Food Supply - Earnings Forecasts Revised Down to Reflect Weak Sales and GPM

Tisco Financial Group Pcl is a bank holding company.  The Company's banking subsidiary offers working capital, project, term, automobile and home loans; custodian services; securities brokerage; mutual funds; and private banking; and advises on equity and debt capital markets, privatizations, debt restructuring, project finance, and mergers and acquisitions.

<ul><li>We initiate our coverage on TISCO with a Neutral rating and a 12M FV of Bt98.73, based on the earnings yield and a required return of 8.1%.</li><li>The required return being lower than the dividend yield suggests that the share price may move in the range of Bt90-100/share, as in the past, with the high dividend yield helping to limit the downside risk to the share price.</li><li>Meanwhile, the long-term growth prospects remain weak, unless external supporting factors emerge, such as bond yields or the equity risk premium (ERP).</li></ul>

We initiate our coverage on TISCO with a Neutral rating and a 12M FV of Bt98.73, based on the earnings yield and a required return of 8.1%.The required return being lower than the dividend yield suggests that the share price may move in the range of Bt90-100/share, as in the past, with the high dividend yield helping to limit the downside risk to the share price.Meanwhile, the long-term growth prospects remain weak, unless external supporting factors emerge, such as bond yields or the equity risk premium (ERP).

Tisco Financial Group - Lack of Growth Catalysts but Attractive Dividend