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

The company posted 1Q19 net profit of Bt12m (-37%YoY and -32% QoQ), the lowest level in more than ten quarters. The result was substantial off from our forecast and accounted for just 12% of our 2019E earnings forecast.<ul>
<li>Both YoY and QoQ drops were pressured by low gross margin business in cross broader transportation under Euroasia Total Logistics (40% stake), which trimmed gross profit margin down to an all-time low level at 16%.</li>
<li>Revenue grew 25%YoY to Bt481m mainly driven by sea freight segment (+22%YoY to Bt175m) and cross broader business (13% of total revenue in 1Q19). However, revenue dropped 9%QoQ due to seasonal factor.</li>
<li>We cut our 2019-20E earnings forecast by 14% and 5% to reflect lower-than-expected gross margin for ETL.</li>
</ul>We maintain our BUY rating with a new target price of Bt4.70 derived from 29xPE’19E,  which is its 1-year trading average and 20% discount to Thailand peers in transportation sector.

The company posted 1Q19 net profit of Bt12m (-37%YoY and -32% QoQ), the lowest level in more than ten quarters. The result was substantial off from our forecast and accounted for just 12% of our 2019E earnings forecast.
Both YoY and QoQ drops were pressured by low gross margin business in cross broader transportation under Euroasia Total Logistics (40% stake), which trimmed gross profit margin down to an all-time low level at 16%.
Revenue grew 25%YoY to Bt481m mainly driven by sea freight segment (+22%YoY to Bt175m) and cross broader business (13% of total revenue in 1Q19). However, revenue dropped 9%QoQ due to seasonal factor.
We cut our 2019-20E earnings forecast by 14% and 5% to reflect lower-than-expected gross margin for ETL.
We maintain our BUY rating with a new target price of Bt4.70 derived from 29xPE’19E,  which is its 1-year trading average and 20% discount to Thailand peers in transportation sector.

WICE: Cost Burden from Cross Broader Business Pressured 1Q19 Profit

Wice Logistics

WICE: Cost Burden from Cross Broader Business Pressured 1Q19 Profit