Sources from The Erawan Group Public Company Limited (SET: ERW) revealed to “Kaohoon” that the company’s overall performance in 4Q24 saw significant growth. This quarter could be the quarter that achieves a new high as the company’s revenue swells alongside hotel demand. The surge in demand drove the company’s hotel occupancy rate (OCC) by almost 100%.
Furthermore, the company also receives high-paying customers, which helps push the company’s profit up even further, while expanding its business base and improving management efficiency.
As such ERW is confident that the company’s 2024 overall performance would meet revenue growth target of 10-15% target, with OCC of at least 80% and average daily rate (ADR) growth of no less than 5% from the previous year, based on the numbers of both Thai tourist and especially foreign tourist that continue to visit Thailand.
ERW will hold a Board of Director meeting on 24 February 2025 to approve the company’s 4Q24 financial statement. The report is expected to be close to the broker’s forecast.
In a report, Finansia Syrus Securities suggested “Buy” ERW at the target price of THB 6.20, as the company performed better than the market estimate. The securities also see positive in the new high-profit forecast, as profit in 4Q24 has almost doubled from the pre-pandemic period, but the market cap remains roughly the same, reflecting a 40-50% discount in ERW valuation, thus the securities see an investment opportunity.
For 4Q24, ERW’s normal profit is estimated at THB 325 million, soaring 58% from the same period a year ago, and a 161% boost from the previous quarter, which is a record high supported by growth in average income from all of the company’s hotel room (excluding Hop Inn). ERW’s profit margin, before accounting for interest, taxes, maintenance cost, and EBITDA margin, could also see a surge, supporting 2024’s 20% growth to THB 861 million from the previous year. The company’s profit in 2025 is forecasted a 9% growth from a year ago to THB 940 million, due to an increase in tourists, although ERW still has an overhang from the Grand Hyatt Erawan (GHE) rental contract.
