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

Osotspa Public Company Limited / Equity Bottom-Up

<p>We maintain BUY rating with target price at Bt43, based on 35xPE’21E, the average of the Thailand energy drinks stocks.</p><div>• We expect 3Q21 earnings to hit bottom of this year due to impact from cities lockdown for the whole quarter and low season quarters (rainy season). However, we expect 4Q21 profit to recover back quickly supported by multi-brand strategy and demand recovery after cities lockdown easing.</div><div></div><div>• Ready for inorganic growth is a new key message from top management. OSP is a net cash company. If the company leverage D/E ratio to 1 times from 0.4 times in 2Q21, we estimated potential earnings upside of Bt1.8bn or roughly 50% of 2020 net profit base on average ROA of 15%.</div><div></div><div>• Faster-than-expected vaccine rollout and a sign for reduction in number of new COVID-19 patient will be the key catalysts.</div><p></p><p>We maintain positive view toward its medium to long-term outlook driven by 1) Growing and gaining market share in Thailand energy drinks; 2) Solid C-vitt sales growth momentum; 3) Solid sales growth in CLMV markets; and 4) upside risk from inorganic growth.</p>

We maintain BUY rating with target price at Bt43, based on 35xPE’21E, the average of the Thailand energy drinks stocks.• We expect 3Q21 earnings to hit bottom of this year due to impact from cities lockdown for the whole quarter and low season quarters (rainy season). However, we expect 4Q21 profit to recover back quickly supported by multi-brand strategy and demand recovery after cities lockdown easing.• Ready for inorganic growth is a new key message from top management. OSP is a net cash company. If the company leverage D/E ratio to 1 times from 0.4 times in 2Q21, we estimated potential earnings upside of Bt1.8bn or roughly 50% of 2020 net profit base on average ROA of 15%.• Faster-than-expected vaccine rollout and a sign for reduction in number of new COVID-19 patient will be the key catalysts.We maintain positive view toward its medium to long-term outlook driven by 1) Growing and gaining market share in Thailand energy drinks; 2) Solid C-vitt sales growth momentum; 3) Solid sales growth in CLMV markets; and 4) upside risk from inorganic growth.

OSP: Solid Performance Among COVID-19 Pandemic