Thai Equity - Bottom-up - Equities, Pi Securities PCL, Thailand

Pi Research

Thai Equity - Bottom-up - Equities

Leading, full-service investment firm in Thailand

Pi Securities PCL, Thailand

Pi Securities is a well known securities company with 40 years experience in the industry, serving more than 60,000 clients. We offer one - stop service providing full range of financial products and services including extensive Brokerage, Proprietary Trading (Equities and Bonds), Advisory Services, Structured Products.

Moreover, our new research team tailored for institutional clients to focus on mid to small cap of Thai equities and trading strategies. Our services offered to our premium clients also include arrangement of company or site visits to with the managements of Thai listed companies.

Note: Effective on 1 March 2022, Country Group Securities PCL changed its name to Pi Securities

Equity Bottom-Up

We initiate coverage of CKP with a HOLD rating, based on a target price of Bt5.3, derived from a discounted cash flow valuation (WACC of 8.0% and TG assumption of 1%). Our valuation implies 25x PE’22, or a 1.9x PEG in line with its global peers.The story:<ul>
<li>Absence of capacity expansion to hinder growth.</li>
<li>Earnings surge in 2021 from better hydro operation</li>
<li>High lead time for new project COD leaves upside in doldrums.</li>
<li>Valuation seems to have factored in present business performance</li>
</ul>Risks: <ul>
<li>Foreign exchange rate fluctuation</li>
<li>Drought</li>
<li>Delays to new projects</li>
</ul>Background: CKP engages in electricity generation and sales with various national regulatory bodies and Industrial users, both domestically and internationally, with 8 power plants, totaling 2.17GW installed capacity (1.0GWe, 6th largest listed power producer in Thailand). The company operates 5 projects directly (460MWe) and holds minority stakes in the remaining ones (550MWe). CKP is one of the major hydropower plant developers in Laos (PPA with EGAT), which is home to the bulk of CKP’s portfolio (829MWe, 82%), with the remaining plants spread across cogeneration and solar power facilities in Thailand. The company is a subsidiary of CK Group (CK TB), and is headquartered in Bangkok.

We initiate coverage of CKP with a HOLD rating, based on a target price of Bt5.3, derived from a discounted cash flow valuation (WACC of 8.0% and TG assumption of 1%). Our valuation implies 25x PE’22, or a 1.9x PEG in line with its global peers.The story:
Absence of capacity expansion to hinder growth.
Earnings surge in 2021 from better hydro operation
High lead time for new project COD leaves upside in doldrums.
Valuation seems to have factored in present business performance
Risks: 
Foreign exchange rate fluctuation
Drought
Delays to new projects
Background: CKP engages in electricity generation and sales with various national regulatory bodies and Industrial users, both domestically and internationally, with 8 power plants, totaling 2.17GW installed capacity (1.0GWe, 6th largest listed power producer in Thailand). The company operates 5 projects directly (460MWe) and holds minority stakes in the remaining ones (550MWe). CKP is one of the major hydropower plant developers in Laos (PPA with EGAT), which is home to the bulk of CKP’s portfolio (829MWe, 82%), with the remaining plants spread across cogeneration and solar power facilities in Thailand. The company is a subsidiary of CK Group (CK TB), and is headquartered in Bangkok.

CKP: Demanding Valuation Without Growth Drivers

Thailand

CK Power PCL develops and generates power. The Company operates in Thailand.

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CK Power PCL (CKP TB)

CKP: Demanding Valuation Without Growth Drivers

We initiate coverage of CKP with a HOLD rating, based on a target price of Bt5.3, derived from a discounted cash flow valuation (WACC of 8.0% and...

Pi Securities PCL, Thailand

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