In today’s briefing:
- M : Time to Harvest
- TISCO : Small but Strong
M : Time to Harvest
- We recommend BUY for M supported by three main reason:1) a strong earnings recovery outlook in 2022-24,2) net cash position with upside from new M&A deal and LCS franchise fees
- Earnings is expected to turn positive and strongly QoQ improvement in 2Q22 We expect 2Q22 net profit to be at Bt444m (+64%QoQ), recovery from a loss of Bt99m in 2Q21
- Rising food costs are manageable Most of costs are raw material costs and the major portion of food cost are pork and poultry.
TISCO : Small but Strong
- Maintain BUY for TISCO with a target price of Bt106.00.We like its high dividend payment and solid fundamentals.TISCO’s net profit was 6% better than expected at Bt1.85bn in 2Q22,up 11%YoY
- Despite lingering competition in the auto hire purchase market, loan growth would likely accelerate in 2H22 given an improvement in the chip shortage in the automotive industry.
- Credit costs would likely stay low for the next few years to potentially offset negative impacts from muted fee income from the volatility in the capital market.
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