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

With strong earnings from a equity income provide an attractive dividend yield at 6%-7%. Therefore, we maintain our BUY rating with a new target price of Bt2.4 (down from Bt2.6) based on 10xPE’21E which its a five-years average.<ul>
<li>The fall in 1Q20 earnings both YoY and QoQ was primarily pressured by weakening earnings from residential business which sunk 81%YoY to Bt80m. Meanwhile, equity income dropped only 5.6% YoY to Bt431m.</li>
<li>We expect 2Q20 earnings to soft down 25%YoY and 10%QoQ, given lower contribution from associated companies especially from HMPRO. Meanwhile, we expect residential transfer units to remain weak QoQ due to low visited rate, but likely to be the bottom quarter.</li>
<li>We maintain positive view in 2020-21E backed by stable equity income from associated companies (mostly from HMPRO) and several projects in pipeline worth over Bt48bn.</li>
</ul>

With strong earnings from a equity income provide an attractive dividend yield at 6%-7%. Therefore, we maintain our BUY rating with a new target price of Bt2.4 (down from Bt2.6) based on 10xPE’21E which its a five-years average.
The fall in 1Q20 earnings both YoY and QoQ was primarily pressured by weakening earnings from residential business which sunk 81%YoY to Bt80m. Meanwhile, equity income dropped only 5.6% YoY to Bt431m.
We expect 2Q20 earnings to soft down 25%YoY and 10%QoQ, given lower contribution from associated companies especially from HMPRO. Meanwhile, we expect residential transfer units to remain weak QoQ due to low visited rate, but likely to be the bottom quarter.
We maintain positive view in 2020-21E backed by stable equity income from associated companies (mostly from HMPRO) and several projects in pipeline worth over Bt48bn.


We initiate coverage on <a href="https://www.smartkarma.com/entities/1388" target="_blank" data-smartkarma-citation="entities:1388:1">Quality Houses (QH TB)</a> with a BUY rating, based on a target price of Bt3.9 and derived from our target of 10.5xPE’1H19E, which represents a 50% discount to the Real Estate sector. 
The story:
<ul>
<li>Attractive dividend payment prospects</li>
<li>Equity income continue to drive recurring income growth</li>
<li>Real estate demand recovery</li>
<li>Core business is advancing robustly and steadily</li>
</ul>
Risks:
<ul>
<li>Tightened credit approval</li>
<li>Construction material costs increase</li>
<li>Labor shortage</li>
</ul>
Background: Established in 1983,  Quality Houses Public Company Limited and its subsidiaries engage in real estate development, in both the sales and rental segments. Its core business is residential development, with projects offering the entire scope of price ranges and various brands, comprising detached houses, town houses and condos. Its commercial developments consist of serviced apartments, hotels, and office buildings. The company also has two associate companies and two property funds: <a href="https://www.smartkarma.com/entities/9906" target="_blank" data-smartkarma-citation="entities:9906:1">Home Product Center (HMPRO TB)</a>, LH Financial Group (LHFG), <a href="https://www.smartkarma.com/entities/22773" target="_blank" data-smartkarma-citation="entities:22773:1">Quality Houses Hotel And Residence Freehold And Leasehold Property Fund (QHHR TB)</a> and <a href="https://www.smartkarma.com/entities/19212" target="_blank" data-smartkarma-citation="entities:19212:1">Quality Houses Leasehold Pro (QHPF TB)</a>.

We initiate coverage on Quality Houses (QH TB) with a BUY rating, based on a target price of Bt3.9 and derived from our target of 10.5xPE’1H19E, which represents a 50% discount to the Real Estate sector. 
The story:

Attractive dividend payment prospects
Equity income continue to drive recurring income growth
Real estate demand recovery
Core business is advancing robustly and steadily

Risks:

Tightened credit approval
Construction material costs increase
Labor shortage

Background: Established in 1983,  Quality Houses Public Company Limited and its subsidiaries engage in real estate development, in both the sales and rental segments. Its core business is residential development, with projects offering the entire scope of price ranges and various brands, comprising detached houses, town houses and condos. Its commercial developments consist of serviced apartments, hotels, and office buildings. The company also has two associate companies and two property funds: Home Product Center (HMPRO TB), LH Financial Group (LHFG), Quality Houses Hotel And Residence Freehold And Leasehold Property Fund (QHHR TB) and Quality Houses Leasehold Pro (QHPF TB).

QH: Dividend Play Outshines Thai Property Peers

Thailand

LH Financial Group Pcl, through a subsidiary, offers banking services.  The bank offers retail banking services through its branch network.

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Lh Financial Group (LHFG TB)

QH: Expect 2Q20 to Be the Bottom Quarter

With strong earnings from a equity income provide an attractive dividend yield at 6%-7%. Therefore, we maintain our BUY rating with a new target...

Pi Securities PCL, Thailand

QH: Dividend Play Outshines Thai Property Peers

We initiate coverage on Quality Houses (QH TB) with a BUY rating, based on a target price of Bt3.9 and derived from our target of 10.5xPE’1H19E,...

Pi Securities PCL, Thailand

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