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

<ul>
<li>With a limited upside to our target price and concern over decreasing people purchasing power following a rise in inflation, we downgrade our recommendation from BUY to HOLD </li>
<li>We expect HMPRO to report 1Q22 net profit at Bt1.49bn (+9%YoY, -16%QoQ),</li>
<li>YoY growth will be supported by solid demand for WFH products, government stimulus scheme (Shop Dee Mee Khuen in Jan –15 Feb 2022), and solid revenue growth from Mega Home</li>
</ul>


With a limited upside to our target price and concern over decreasing people purchasing power following a rise in inflation, we downgrade our recommendation from BUY to HOLD 
We expect HMPRO to report 1Q22 net profit at Bt1.49bn (+9%YoY, -16%QoQ),
YoY growth will be supported by solid demand for WFH products, government stimulus scheme (Shop Dee Mee Khuen in Jan –15 Feb 2022), and solid revenue growth from Mega Home


HMPRO: Expect Strong Earnings Growth YoY in 1Q22

ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

<ul>
<li>
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> 4Q2021 results marked a turnaround in both its packaging business in glass and cans plus better performance from Big C as mobility improved during the quarter.</li>
<li>The outlook for packaging looks positive and the Big C will open more outlets in 2022 plus renovating around 20 hypermarkets plus opening new formats this year.</li>
<li>
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> remains an interesting recovery play for Thailand and Vietnam, with the potential for more retail exposure there in the future. Valuations stack up versus peers.</li>
</ul>



Berli Jucker (BJC TB) 4Q2021 results marked a turnaround in both its packaging business in glass and cans plus better performance from Big C as mobility improved during the quarter.
The outlook for packaging looks positive and the Big C will open more outlets in 2022 plus renovating around 20 hypermarkets plus opening new formats this year.

Berli Jucker (BJC TB) remains an interesting recovery play for Thailand and Vietnam, with the potential for more retail exposure there in the future. Valuations stack up versus peers.


Berli Jucker (BJC IJ) - Ride the Retail and Packaging Recovery

<ul>
<li>Yesterday analyst meeting came out with a positive tone. We reiterate our BUY rating for HMPRO with a target price of Bt17.0(+5%from previous TP),which is derived from 35xPE’22E, a 40%</li>
<li>In 2022, HMPRO plans to open 6 stores comprise of one store for Homepro large store format and 5 stores for Mega home and one HMPRO’s store re-location.</li>
<li>We believe that SSSG continues to positive at 5%in 2022 and 4% in 2023 supported by new products launch together with promotional activities such as Homepro Day, Homepro Super Expro</li>
</ul>


Yesterday analyst meeting came out with a positive tone. We reiterate our BUY rating for HMPRO with a target price of Bt17.0(+5%from previous TP),which is derived from 35xPE’22E, a 40%
In 2022, HMPRO plans to open 6 stores comprise of one store for Homepro large store format and 5 stores for Mega home and one HMPRO’s store re-location.
We believe that SSSG continues to positive at 5%in 2022 and 4% in 2023 supported by new products launch together with promotional activities such as Homepro Day, Homepro Super Expro


HMPRO: Store Expansion to Support 2022-23 Growth

<ul>
<li>We maintain BUY rating for HMPRO with a target price to Bt16.10, derived from 35xPE’22E, or implying 40% premium to Thai Consumer Discretionary.</li>
<li>We expect HMPRO to report 4Q21 net profit at Bt1.57bn (+2%YoY, +80%QoQ),thanks to stores sales recovery (SSSG at +10%YoY) supported by pent-up demand, demand from home renovation after a flood</li>
<li>We foresee 2022E earnings to grow to Bt6bn close to pre-COVID levels (+16%YoY) supported by 1) a solid revenue growth at 4% close to Thailand GDP growth from re-opening stores</li>
</ul>


We maintain BUY rating for HMPRO with a target price to Bt16.10, derived from 35xPE’22E, or implying 40% premium to Thai Consumer Discretionary.
We expect HMPRO to report 4Q21 net profit at Bt1.57bn (+2%YoY, +80%QoQ),thanks to stores sales recovery (SSSG at +10%YoY) supported by pent-up demand, demand from home renovation after a flood
We foresee 2022E earnings to grow to Bt6bn close to pre-COVID levels (+16%YoY) supported by 1) a solid revenue growth at 4% close to Thailand GDP growth from re-opening stores


HMPRO: Expect 4Q21 Earnings to Be the Highest of This Year

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

<ul>
<li>Asset World, Banpu Public and Ngern Tid Lor are being added to the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-50-index" target="_blank" data-smartkarma-citation="entities:31493:1" rel="noopener">SET 50 Index (SET50 INDEX)</a> while Berli Jucker, Delta Electronics and Sri Trang Agro will be deleted.</li>
<li>Estimated one-way turnover is 5.83% and results in a one-way trade of THB 4,957m. The deletions of BJC/ DELTA will result in a funding inflow to the other index constituents.</li>
<li>
<a href="https://www.smartkarma.com/entities/asset-world-corp-pcl" target="_blank" data-smartkarma-citation="entities:28136:1" rel="noopener">Asset World Corporation (AWC TB)</a> is a surprise to an extent with the name not appearing on most lists on the street. We had it as a low probability inclusion.</li>
</ul>


Asset World, Banpu Public and Ngern Tid Lor are being added to the SET 50 Index (SET50 INDEX) while Berli Jucker, Delta Electronics and Sri Trang Agro will be deleted.
Estimated one-way turnover is 5.83% and results in a one-way trade of THB 4,957m. The deletions of BJC/ DELTA will result in a funding inflow to the other index constituents.

Asset World Corporation (AWC TB) is a surprise to an extent with the name not appearing on most lists on the street. We had it as a low probability inclusion.


SET50 December Index Rebalance: AWC, BANPU, TIDLOR Added; BJC, DELTA, STA Out

Thailand

Home Product Center Public Company Limited is a retailer of building materials and home improvement products.

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Home Product Center (HMPRO TB)

HMPRO: Expect Strong Earnings Growth YoY in 1Q22

With a limited upside to our target price and concern over decreasing people purchasing power following a rise in inflation,we downgrade our...

Pi Securities PCL, Thailand

Berli Jucker (BJC IJ) - Ride the Retail and Packaging Recovery

Berli Jucker remains an interesting recovery play for Thailand and Vietnam, with the potential for more retail exposure in Vietnam in the future....

Angus Mackintosh

HMPRO: Store Expansion to Support 2022-23 Growth

Yesterday analyst meeting came out with a positive tone. We reiterate our BUY rating for HMPRO with a target price of Bt17.0 (+5% from previous...

Pi Securities PCL, Thailand

HMPRO: Expect 4Q21 Earnings to Be the Highest of This Year

We maintain BUY rating for HMPRO with a target price to Bt16.10, derived from 35xPE’22E, or implying 40% premium to Thai Consumer Discretionary.

Pi Securities PCL, Thailand

SET50 December Index Rebalance: AWC, BANPU, TIDLOR Added; BJC, DELTA, STA Out

There are 3 changes to the SET50 index at the December rebalance. AWC, BANPU and TIDLOR will replace BJC, DELTA and STA. AWC is a 'surprise' and...

Brian Freitas

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