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

Gulf Energy Development  / Equity Bottom-Up

<p><strong>We maintain the BUY recommendation based on a target price of Bt43.0 derived using SOTP methodology, implying 57x PE’22E.</strong></p><div>• GULF reported 2Q21 net profit of Bt1.4bn  (-25% YoY, -14% QoQ), excluding FX and other extraordinary items the recurring net profit stood same at Bt1.4bn, improving +42% YoY and declining 41% QoQ.</div><div></div><div>• The QoQ decline was due to absence of dividend income from INTUCH and  declined revenue share from BKR2 offshore wind power plant. While the full quarter revenue recognition of GSRC (COD in 1Q21) and higher IU electricity sales from GMP resulted the YoY growth.</div><div></div><div>• GULF increased its stake in INTUCH to 42.5%, making it the largest share holder. The company will book dividend income from INTUCH in 3Q, and either consolidate or record profit under equity method 4Q21 onwards.</div><div></div><div>• Expect 3Q21 recurring net profit to improve both YoY and QoQ on the back of a huge dividend income of around B1.6bn from INTUCH.</div>

We maintain the BUY recommendation based on a target price of Bt43.0 derived using SOTP methodology, implying 57x PE’22E.• GULF reported 2Q21 net profit of Bt1.4bn  (-25% YoY, -14% QoQ), excluding FX and other extraordinary items the recurring net profit stood same at Bt1.4bn, improving +42% YoY and declining 41% QoQ.• The QoQ decline was due to absence of dividend income from INTUCH and  declined revenue share from BKR2 offshore wind power plant. While the full quarter revenue recognition of GSRC (COD in 1Q21) and higher IU electricity sales from GMP resulted the YoY growth.• GULF increased its stake in INTUCH to 42.5%, making it the largest share holder. The company will book dividend income from INTUCH in 3Q, and either consolidate or record profit under equity method 4Q21 onwards.• Expect 3Q21 recurring net profit to improve both YoY and QoQ on the back of a huge dividend income of around B1.6bn from INTUCH.

GULF: Huge Dividend Gain from INTUCH in 3Q21

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

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<p>In StubWorld this week ...</p>
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<p><a href="https://www.smartkarma.com/entities/indofood-sukses-makmur-tbk-p" target="_blank" data-smartkarma-citation="entities:1053:1" rel="noopener"></a>Beleaguered <a href="https://www.smartkarma.com/entities/china-evergrande-group" target="_blank" data-smartkarma-citation="entities:479:1" rel="noopener">Evergrande Real Estate Group (3333 HK)</a>'s shares bounced after the company <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0810/2021081001009.pdf" target="_blank" rel="noopener">said</a> it is in talks to sell stakes in two of its units. But optimism over improved capital management appears naive. </p>
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<p>Preceding my comments on Evergrande are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
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<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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<p>As always, more below the fold.</p>
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In StubWorld this week ...




Beleaguered Evergrande Real Estate Group (3333 HK)'s shares bounced after the company said it is in talks to sell stakes in two of its units. But optimism over improved capital management appears naive. 




Preceding my comments on Evergrande are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


As always, more below the fold.


<div>
<p>This week in StubWorld ...</p>
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<p>Not surprisingly, <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a>'s IFA <a href="https://www.set.or.th/set/pdfnews.do?newsId=16266518153870&amp;sequence=2021078813" target="_blank" rel="noopener">says</a> the Offer from <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a> is "<em>appropriate</em>". Equally unsurprising, <a href="https://www.smartkarma.com/entities/advanced-info-service-pcl" target="_blank" data-smartkarma-citation="entities:947:1" rel="noopener">Advanced Info Service (ADVANC TB)</a>'s IFA <a href="https://www.set.or.th/set/pdfnews.do?newsId=16266518153760&amp;sequence=2021078811" target="_blank" rel="noopener">has</a> the opinion that the shareholders should reject the Tender Offer from Gulf.</p>
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<p>Preceding my comments on Intouch are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
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<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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<p>As always, more below the fold.</p>
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This week in StubWorld ...



Not surprisingly, Intouch Holdings (INTUCH TB)'s IFA says the Offer from Gulf Energy Development Public Company (GULF TB) is "appropriate". Equally unsurprising, Advanced Info Service (ADVANC TB)'s IFA has the opinion that the shareholders should reject the Tender Offer from Gulf.



Preceding my comments on Intouch are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


As always, more below the fold.


StubWorld: IFAs Say "Yea" For Intouch, "Nay" For AIS

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<p>This week in StubWorld ...</p>
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<p>With <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> trading at terms to <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a>'s Offer...</p>
<p><em><strong>...What's the play here?</strong></em></p>
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<p>Preceding my comments on Intouch are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
</div>
<div>
<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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This week in StubWorld ...




With Intouch Holdings (INTUCH TB) trading at terms to Gulf Energy Development Public Company (GULF TB)'s Offer...
...What's the play here?




Preceding my comments on Intouch are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


StubWorld: Gulf's Curious Offer For Intouch Now Open

Thematic (Sector/Industry)

<h2>CGS: 3Q21 Road Show</h2><ul>
<li><h3>Performance review of CGS‘s stock picks</h3></li>
<li><h3>CGS Strategy</h3></li>
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<h3>Our stock picks for 3Q21</h3>
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<strong>KBANK</strong>:  Most benefit amongst big banks post-COVID recovery</li>
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<strong>EPG</strong>: Global-standard polymer converter assured of sustainable growth</li>
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<strong><strong>CKP:</strong></strong> Positive 2021-22 outlook from the better hydro operation</li>
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<h3>Power sector</h3>
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<strong>RATCH</strong>: Stable earnings outlook and a high dividend yield</li>
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<strong>GULF</strong>: Earning growth and upside from INTUCH investment</li>
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</li>
</ul>

CGS: 3Q21 Road Show
Performance review of CGS‘s stock picks
CGS Strategy

Our stock picks for 3Q21


KBANK:  Most benefit amongst big banks post-COVID recovery

EPG: Global-standard polymer converter assured of sustainable growth

CKP: Positive 2021-22 outlook from the better hydro operation



Power sector


RATCH: Stable earnings outlook and a high dividend yield

GULF: Earning growth and upside from INTUCH investment




Thailand

Gulf Energy Development Public Company Limited produces and sells electricity and steam. The Company manages a portfolio of gas-fired and renewable power projects, as well as supplies steam and chilled water. Gulf Energy Development serves customers in Thailand.

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Gulf Energy Development (GULF TB)

GULF: Huge Dividend Gain from INTUCH in 3Q21

We maintain the BUY recommendation based on a target price of Bt43.0 derived using SOTP methodology, implying 57x PE’22E.

Pi Securities PCL, Thailand

StubWorld: What To Do With Evergrande?

Evergrande Auto is not worth what its market cap suggests to an independent third party; and Property Services may or may not be worth what people...

David Blennerhassett

StubWorld: IFAs Say "Yea" For Intouch, "Nay" For AIS

I would still avoid Intouch here, but I would not short it, or short tender the stock. Best to wait until the close of the Offer to get a clearer...

David Blennerhassett

StubWorld: Gulf's Curious Offer For Intouch Now Open

I would avoid Intouch here, but I would not short it. I think we have to wait until the close of the Offer to get a better idea of what Gulf's next...

David Blennerhassett

3Q21 Road Show

CGS's roadshow : Performance review of CGS ‘s stock picks, CGS Strategy, Our stock picks for 3Q21, Power sector outlook 3Q21

Pi Securities PCL, Thailand

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