The share price of Srisawad Corporation Public Company Limited (SET: SAWAD) has plunged 15% since the announcement of its 4Q24 earnings that disappointed the market. The price dropped from THB40.00 level to THB34.25 per share at the closing on March 4, 2025.
CLSA wrote in a comment that SAWAD’s management maintains a bullish stance on the company’s liquidity management, noting no concerns this year compared to the second half of 2024, when SAWAD experienced negative loan growth. This year, SAWAD is anticipated to achieve a portfolio growth of 10-15%, largely propelled by its auto title loan product. Additionally, management indicates an expected improvement in asset quality, largely attributed to selective portfolio growth.
CLSA reiterated a “Buy” recommendation with a target price of THB41.00 per share.
Conversely, DBS Vickers is more cautious, underscoring concerns about portfolio quality in its latest assessment. They reiterated SAWAD’s fourth-quarter earnings at THB1.2 billion, marking a 3.3% decrease year-on-year and a 5.8% drop quarter-on-quarter. The full-year earnings for 2024 reached THB5.05 billion, only a 1.0% increase year-on-year, while falling short of predictions. DBS highlights persistent issues with asset quality as a concern and has adjusted their forward earnings forecasts for FY25 and FY26, cutting estimates by 18% and 19%, respectively, to align with lower loan growth, narrowed net interest margins, and an elevated cost-to-income ratio. DBS shifted its recommendation to a “Buy” rating, but lowered the target price to THB35.00.
