STI: Solid Groundwork Laid for an Attractive Investment

We initiate coverage on STI with a BUY recommendation based on a target price of Bt10.10, implying an upside of 29% from the current price. We derive our target price from a sum-of-the-parts approach and apply a 15% small-cap discount.

Investment thesis:

• Recent acquisition gives access to government infrastructure projects
• Major shareholder as a key strategic partner for deal flow
• Backlog ensures strong near-term growth and revenue stability

Risks: Reliance on limited industries, delay in project completion, shortage of experienced personnel, and adverse regulatory changes.