Stocks in the news (aot, bay, ea, eastw, gpsc, ivl, kbank, pps, tpoly, ttcl, wice) 28.05.18
AOT
AOT is expanding its airports in Chiang Mai and Phuket with a budget of Bt120bn to support rising traffic, both domestic and overseas. (Thun Hoon, 28/5/18)
BAY
BAY management said that SME loans grew nicely at 2-3% YoY in 4M18 and is maintaining its fullyear target growth of 11%. Bad debts will be controlled at no more than 1.5% while fee revenue from selling funds and insurance is growing well. (Kao Hoon, 28/5/18)
EA
EA is confident in the 4Q18 startup of the 260 MW Hanuman wind farm. This will lift its total capacity of operating projects to 664 MW. Management aims to expand its power business in Vietnam and the Philippines and also via interesting M&As. (Kao Hoon, 28/5/18)
Comment: Same story for EA but their battery investment is still a massive question mark
EASTW
EASTW expects to sign new contracts to provide industrial water to large new customers, GULF and AMATA, within 3Q18 with a target to replace raw water with industrial water in 10 years, which would give a higher gross margin of 30-50%. (Thun Hoon, 28/5/18)
GPSC
GPSC with two partners will expand Nava Nakorn Phase 2 with a budget of Bt3.1bn to add 60 MW electricity capacity and 10 tph stream capacity with the scheduled commercial operation date in 3Q20 in order to support rising demand. (Kao Hoon, 28/5/18)
IVL
IVL will acquire a PET business in Brazil to raise capacity by 550,000 tons with plans for another M&A deal in the US by 3Q18. Total capacity is targeted to raise to 13.5 mn tons/year by 2019. The company has a budget of US$7bn for M&As. (Thun Hoon, 28/5/18)
KBANK
KBANK expects loan this year to exceed target growth of 5-7% as this target was based on the GDP-growth assumption of 4%, while growth was 4.8% in 1Q18. Furthermore, the growing economy will help reduce bad debts. (Post Today, 28/5/18)
Comment: Wasn’t it the case that banks loan growth used to be 2x GDP?
PPS
PPS got a big project valued at Bt400mn, expanding its business overseas. Management maintains the revenue growth target of 20% to Bt450mn in 2018 and aims to keep backlog at Bt500mn. (Thun Hoon, 28/5/18)
Comment: Great little company but its driven by the accounting recognition of these projects hence the topsy-turvy movement of the stock price
SSP
SSP currently has 74.4 MW capacity and expects to start commercial operations of new projects with total capacity of 90 MW by the end of this year. If all committed projects achieve commercial operations, the company’s portfolio would grow to 193.8 MW, rising by 160% from current capacity. 1Q18 earnings grew 4% YoY to Bt107mn and it is confident that 2018 revenue will grow 10% YoY. (Thun Hoon, 28/5/18)
Comment: Another company’s stock price that was hurt by the Energy Minister.
THAI
THAI’s new president will be focusing on marketing activities to support earnings growth with no focus on the internal restructure. (Krungthep Turakij, 28/5/18)
TPOLY
TPOLY has backlog of about Bt3bn, all of which will be booked as income this year, supporting revenue growth of no less than 10% in line with its target. It will participate in bidding of no less than Bt3bn. It will install six power plants with 60MW and hopes to maintain gross margin at 25.85% this year. (Thun Hoon, 28/5/18)
Comment: Story remains the same, TPCH holding value, and the core business of TPOLY has turned around.
TTCL
TTCL won a Bt1.4bn EPC job in Myanmar. This raises backlog to Bt10bn. It expects revenue will grow 10% YoY from Bt11.0bn last year. As petrochemicals are in an up-cycle, there is more investment and construction taking place. It expects a better 2Q18 backed by rising EPC revenue. It is in the process of bidding for more than Bt10bn in jobs in 2H18. (Thun Hoon, 28/5/18)
WICE
WICE has gotten substantial orders from China and Hong Kong which will raise its revenue growth to 40%. It expects a stronger 2Q18 on a weaker THB plus better auto exports. It is looking better in 2H18 with more orders which will enable it to make its revenue growth target of 30% this year. (Thun Hoon, 28/5/18)
Xavi
On another note, I was adding UNIQ when their backlog was growing significantly and the shareprice weakening, but now with Q1 earnings weak and possibility of dropping out of the Set100, price has shot up some 10-15%, all based on sentiment of govt projects, go figure!
I have also done some research into Tpoly and initiated a position at 3.10, Pon, do you know why the non controlling interests in Tpoly is so high? Foreign partner or something else?
Pon
Contractors always move on sentiment in the ST
Pon
tpoly’s stake in tpch explains the non controlling interest.
Xavi
thanks Pon.