Following the announcement via the Stock Exchange of Thailand (SET) on October 25, 2024, the Board of Directors Meeting of Italian-Thai Development Public Company Limited (SET: ITD) approved the disposal of all shares held by the company in ITD Cementation India Limited (ITD Cem), totaling 80,113,180 shares, representing 46.64% of the total issued, at a price of INR 400 per share, amounting to a total of INR 32,045 million, or approximately THB 11,863 million, to RENEW EXIM DMCC, a unit of billionaire Gautam Adani’s Adani Group that based in Dubai, United Arab Emirates, engaging in the business of investment in commercial enterprises and management.
DAOL Securities (Thailand) views the aforementioned development as a favorable sign for four financial institutions – BBL, KBANK, SCB, and KTB – as they are creditors of ITD. The disposal of ITD’s assets has the potential to partially alleviate the company’s debt burden to these creditors.
According to the past reports, ITD had debts of THB 8 billion, THB 6 billion, THB 6 billion, and THB 4 billion to BBL, KBANK, SCB, and KTB, respectively. Each bank held 50% of the collateral for the total debt.
With BBL and KTB classifying ITD as a stage 3 debtor (NPL), the analyst foresees that a gradual debt repayment could bring the most advantages to both financial institutes, paving the way for a potential reclassification of the debtor in the future.
DAOL Securities (Thailand) maintains an ‘Overweight’ rating for the banking sector and designates KTB and KBANK as top-pick stocks, giving ‘BUY’ recommendations with target prices of THB 23 and THB 176 per share, respectively.
