B-WORK: Stable Tenants and Good Dividend Yield Give Low Risk

We keep our BUY recommendation on B-WORK and slightly decrease the target price to Bt13.60 from Bt13.90, implying an upside of 21% from the current share price. We derive our target price from a DCF-based valuation using a WACC of 7.0% and no terminal period.

Investment thesis:

• Group affiliation assures a high occupancy rate and stable revenue
• Impact from COVID-19 should be limited
• Addition of new assets offer upside to our target price
• Pays higher dividend yield than Thai peers, expect 7% in 2021-2022E

Interim: The 3Q20 results were slightly better than we expected as revenue grew QoQ . The high occupancy rate ensures stable revenue for the REIT.

Risks: Conflict of interest risk due to the largest unitholder and tenant being within the same conglomerate, rising bond yields, falling occupancy rate, and higher-than-expected renovation and overhaul costs.