BTS is expecting to promptly receive the THB 14 billion outstanding fee from its operation and maintenance (O&M) of the Green Line trains. “Chadchart” expedited the Bangkok Metropolitan Council to settle the amount by the end of September, within FY24 to avoid incurring interest in FY25, while the remaining amount totaling THB 25 billion will be later negotiated. BTS executives are certain of the ensuing 0.25 D/E ratio, while brokers suggest a target price at THB 5.59 – comparatively inexpensive in comparison to 1.3x P/B and other positive factors.
Mr. Surapong Laoha-unya, Director of Bangkok Transit System Corporation Ltd. or “BTSC” and Chief Officer of MOVE Business of BTS Group Holdings PCL told “Kaohoon” a discussion has been had with Krungthep Thanakom (KT) and concluded the total payable at THB 14,549,503,800 for O&M of the Green Line Extension 1: commuting between Saphan Taksin-Wongwian Yai-Bang Wa and Onnut-Bearing (from May 2019 to May 2021); and Extension 2: covering Bearing-Samut Prakan and Mo Chit-Saphan Mai-Koo Khot (from April 2020 to May 2022.), to be paid within 30 days in accordance with the Supreme Administrative Court’s order.
“Bangkok Metropolis will be able to repay this October, sooner than formerly specified by Mayor Chadchart, after which BTS will settle its own debt to reduce D/E ratio planned,” said Mr. Surapong.
Following the appointment of an ad-hoc committee to consider ฺthe drafted Bangkok Metropolitan Code, the settlement of O&M debt should not be impeded. Bangkok Metropolis reaffirmed its capacity for the foregoing amount. However, the remaining debt amounting to roughly THB 20-30 billion must be discussed down the line.
The total amount of Bangkok’s O&M debt payable to BTS is approximately THB 40 million periodically spreaded: first period from April, 2017 to May, 2021 on which the Supreme Administrative Court’s verdict demands THB 14.5 billion in principal and interest to be paid; subsequent period from June 2021 to October 2022 amounting to roughly THB 10 billion is in consideration by the Administrative Court of First Instance; and another THB 14 billion incurred from November to date yet to be arraigned.
Provided the M:R+1 average interest rate calculated on THB 40 billion to be paid by Bangkok Metropolis, interest payable would be as high as THB 7 million a day, equivalent to THB 2.5 billion a year.
Following the repayment of the first amount (THB 23 billion for electrical-mechanical work for Mochit-Saphan Mai-Koo Khot extension), BTS would have its debt-to-equity reduced to 0.44 and further 0.25 once the THB 14 billion O&M cost has been repaid.
