Kaohoon Online has selected stocks with a high-growth potential for investors to consider on November 1, 2021.
Maybank Kim Eng Securities (Thailand) (MBKET) has given a “BUY” recommendation on B.Grimm Power Public Company Limited (BGRIM) with a target price at ฿62.00/share.
MBKET stated that the acquisition of Eastern Cogeneration under base-case scenario will add 148MWe (equity) or 7% of BGRIM’s FY22 committed capacity. This deal is part of the 1GW pipeline that BGRIM is looking to execute over the next 2-3 quarters. This transaction marks the first of many other deals to come and will ease market concerns on growth. Rising gas prices remain a headwind, but valuation is attractive and offers a margin of safety.
The acquisition was made through Univenture BGP Co., Ltd. “UVBGP”, an associated company of BGRIM (45%) and Univentures (55%). Assets including PPTC (120MW, SPP) and SSTUT (240MW, 2SPP), UVBGP will hold 100% of SSUT and 75% of PPTC (negotiating remaining 25%). Assets under E-COGEN include PPTC (120MW, SPP) and SSTUT (240MW, 2SPP). UVBGP will hold 100% of SSUT and 75% of PPTC (negotiating remaining 25%)
KTBST Securities (KTBST) has given a “BUY” recommendation on Minor International Public Company Limited (MINT) with a target price at ฿40.00/share.
KTBST stated that the target price was rolled over to 2022E from Bt38.00 to Bt40.00 based on the DCF method (WACC 7%, terminal growth 2.5%). KTBST expected 3Q21E normalized loss to be at 2.35 billion baht, decreased from a 4.78 billion baht of loss in 3Q20 and 3.39 billion baht in 2Q21 due to the gradual opening of hotels in Europe, increasing RevPar to +200% from -67% in 3Q20. However, the food and beverage business is expected to shrink due to the lockdown.
KTBST expected 2021 to report a core loss of 12 billion baht, improved from 19 billion baht of core loss in 2020. 4Q21 would still be a loss, but post some improvement YoY and QoQ due to high season for Thailand and Europe. KTBST expected the company to record a profit in 2022 as MINT has the fastest recovery among the tourism sector.
In addition, the share price of MINT rose 2% in the past month compared to SET and still underperform ERW and CENTEL due to the reopening sentiment. Still, KTBST preferred MINT due to its fast recovery in Europe compared to Thailand. The company has cheap valuation, trading at 2022E EV/EBITDA of 15x (-1.0 SD below 10-yr average), compared to ERW and CENTEL at 0.5SD.
