WHTW: Top 10

  • Tax cheer for Songkran? — To heat up local dining and travel during the sweltering Thai New Year season, the government plans to roll out a new tax incentive scheme aimed at sparking a Songkran spending spree amid the languid economic recovery. (Bangkok Post, 21/3/16)
  • Stimulus deadline spurs race to cut rates — Mortgage competition is heating up with banks racing to offer lower interest rates for the first three years to attract homebuyers. The race to win new customers comes before lower interest rates from the government’s property stimulus measures expire next month. (Bangkok Post, 21/3/16)
  • Thailand to go it alone on Thai-Sino high-speed rail — Thailand has decided to wholly invest in the Thai-Sino railway project after it failed to agree in talks with China on the terms of the arrangement which has set back progress for months. (Bangkok Post, 24/3/16)
  • BAAC allows B100bn for SME loans — The state-backed Bank for Agriculture and Agricultural Cooperatives (BAAC) aims to extend 100 billion baht in loans a year from now through 2018 to small and medium-sized farms, which it targets to account for 30% of its portfolio. (Bangkok Post, 24/3/16)

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Co Visit: Univentures Plc (UV)

Diversified property holdings key to success for UV

Univentures Plc (UV) was founded in 1980 as a manufacturer and distributor of zinc oxide and listed on the SET in 1988. Over the years it has evolved and today it is a holding company specialising mainly in property and related businesses. Director Worawat Srisa-an discusses the company’s strategy and outlook.

Please explain UV’s holding structure.

UV is a holding company that invests through subsidiaries or joint-venture companies. The business groups are 90% in real estate, including residential and commercial and property services, and other businesses such as zinc oxide, parking systems and energy saving. Our aim is to balance and diversify our portfolio; we hold 100% of Grand Unity Development which focuses on high-rise real estate, and 39.28% in Golden Land Plc which focuses on low-rise projects. We also own, directly or indirectly, the Sathorn Square and Park Ventures commercial office assets.

Please explain the business strategies of each of UV’s real estate segments.

With Grand Unity we focus on real market demand with our three main offerings priced from 50,000 to 90,000 baht per square metre and target customers typically aged 25-35 years old. It has Condo U developments, typically eight-storey buildings located just off main roads; U Delight high-rise developments in more prime locations, near existing and future mass-transit developments; and U Delight Residences in premium locations such as on Rama III overlooking the Chao Phraya River.


Worawat: Growth and profitability balance

For these three offerings we aim to create value in terms of functionality of the site, rooms and layout, ensuring efficient design for a community of like-minded residents. We are the only developer that does not require air-conditioning in lobbies because we maximise the airflow within the compound, allowing us to invest in other value-added amenities such as fitness rooms, libraries and common space, offering residents lower common fees.

When we first acquired Golden Land, its product offerings were purely low- to mid-market single detached houses and townhouses. In 2014, Golden Land acquired Krungthep Land (KLand) to expand its low-rise offerings to the premium segment. The price range is now between 2 million and 25 million baht depending on the project and the unit. Typically these projects are farther from the city centre as they require more land; however they are near main throughways and expressways.

The commercial assets, Sathorn Square and FYI Center, are both owned by Golden Land while Park Ventures Ecoplex is directly owned by UV. We focus on premium locations, with Park Ventures earning the highest rent per square metre in Bangkok, and the only office building to have received the LEED Platinum award.

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Stocks in the news (ait, apco, as, bjc, ccn, cpf, fer, hpt, kbank, major, ratch, sci, scp, siri, tpbi) 25.03.16

AIT sets 2016 revenue target growth at 10% from Bt5.1bn in 2015 supported by its backlog of more than Bt3bn and government projects. It plans to start a data center project within 2Q16. (Kao Hoon, 25/03/16)

APCO sets 2016 sales target at Bt450 or growth of at least 10% and maintain gross margin at no less than 85%. It will focus on the domestic market. In 1Q16 it had a good response and Direct Service is ready to send Operation BIM to drugstores. It plans to pay a dividend of 100% of net profit. (Thun Hoon, 25/03/16)
Comment: We said back in 2014 that this company was trading at ridiculous valuations and even though the price is off by some 40%, I still think it’s incredibly expensive.

AS sets 2016 revenue target growth at 30%, supported by launch of 24 new games and adding games on mobile to reach 30% of all revenue. It expects 2016 earnings will turn around. (Thun Hoon, 25/03/16)
Comment: I do wonder if they can actually do it…we’ve been waiting for a number of years and perhaps its finally time.

BJC is leading the pack. After it acquires BIGC it will be the biggest retailer in ASEAN. It targets 2016 revenue growth at 10% supported by sales from abroad. It has budgeted Bt4.5bn to expand capacity both inside and outside Thailand. It is confident that its tender offer will proceed as planned. (Thun Hoon, 25/03/16)
Comment: They own retail in Thailand, they have metro in Vietnam, so I fully expect to see expansions into Laos and Cambodia.

Continue reading Stocks in the news (ait, apco, as, bjc, ccn, cpf, fer, hpt, kbank, major, ratch, sci, scp, siri, tpbi) 25.03.16

Stocks in the news (aot, big, bigc, bjc, gtb, itd, lpn, major, rojna, sena, solar, super, thana, tbbi, tsr, ttw) 24.03.16

AOT expects earnings to be better than in 2015, which had a profit of Bt18.7bn, backed by weak oil price and tourist expansion. The board approved a budget of Bt27bn for Phase 3 of Don Muang airport. It will extend the lower landing fee to two years. (Thun Hoon, 24/03/16)
Comment: Boom, get ready for more mainland tourists

BIG expects 1Q16 sales growth of no less than 10% supported by the popularity of mirrorless cameras. It is confident that earnings in 2016 will hit target. It plans to open 10 new branches. (Thun Hoon, 24/03/16)
Comment: This stock has been a tear, it does seem that the younger consumers are happily buying camera in droves, is this taking demand away from smartphones?

BIGC budgeted Bt16bn to build strength and open new branches nationwide. It will change strategy and have seasonal campaigns to boost sales. (Thun Hoon, 24/03/16)

BJC prepares to tender for 341.99mn shares or 41.45% of BIGC at Bt250.26/share, in total worth Bt86bn. (Kao Hoon, 24/03/16)
Comment: A deal without any excitement on its last day


On its first day of trade GTB price closed up 57.39% at Bt1.81, above IPO price. Its CEO said that 2016 net profit will surpass last year’s Bt69mn, supported by Its backlog of more than Bt400mn. (Kao Hoon, 24/03/16)

ITD got two new jobs in total worth Bt294mn. It has backlog of Bt259bn in the first two months. It plans to sign for a new job worth Bt23.9bn. (Kao Hoon, 24/03/16)

LPN expects transfers in 1Q16 to reach Bt4bn or 100% growth supported by the completion of five projects valued at Bt10.2bn. It has backlog of Bt4-5bn to support demand before the property stimulus ends. (Kao Hoon, 24/03/16)
Comment: Every property developer should be off to a cracking start this year, the question is only will it be sustainable.

MAJOR expects 1Q16 revenue to grow more than 10% supported by more revenue from foreign movies. It plans to increase the number of screens to 1,000. It expects to increase revenue from foreign movies in neighboring countries to 10%. (Thun Hoon, 24/03/16)
Comment: Batman vs Superman!

ROJNA targets to sell 400-500 rai of land in this year on the back of planned additional investment by Japanese and Chinese clients. It expects no help from BOI approvals because of the economic slowdown. It expects its 110MW cogeneration power plant to supply electricity from mid-2017. (Khao Hoon, 24/03/16)
Comment: Perhaps one of the CHEAPEST companies out there but….is it a value trap given how laid back management are?

SENA targets 2016 revenue of Bt3.5bn. It plans to invest in 100MW solar power plants by 2018. It plans to list SENA Solar Energy soon. (Thun Hoon, 24/03/16)
Comment: Again something that the market should already know by now, but is it priced in? Do people believe in the management’s capability to expand this heavily into solar?

SOLAR expects to show s net profit in 1Q16 with revenue of Bt400mn. It expects 2016 net profit to return to the black with revenue not less than Bt3bn backed by 400MW solar cells capacity. It expects higher revenue aided by government projects. (Khao Hoon, 24/03/16)

SUPER expects to benefit from extension period for supplying electricity. It expects to supply 400MW electricity by April 30. It expects to begin to supply electricity at the end of March. (Khao Hoon, 24/03/16)

THANA expects backlog of Bt100mn in 1Q16. It is confident 2016 revenue will reach Bt1bn (20% growth). It plans to launch three low-rise projects valued at Bt1.4bn. (Khao Hoon, 24/03/16)

TBBI will trade today. It expects a good response from investors because of its strength and productivity technology. It plans to expand integrated packaging at home and abroad. It plans to double revenue within five years. It expects to become a global leader in packaging. (Thun Hoon, 24/03/16)

TSR plans to open two branches, Buriram and Mukdahan. It plans to move its branches at Phitsanulok and Hatyai. It expects 2016 revenue and net profit to mark a record high this year. (Khao Hoon, 24/03/16)
Comment: I’m starting to see their advertisement’s for their “Safe” brand on buses.

TTW plans to invest in a 40,000 cubic meter tap water plant in Myanmar in 2H16. It expects domestic tap water demand to grow 5-10%. It expects enough supply to meet demand. (Khao Hoon, 24/03/16)