Kasikorn Securities offers an optimistic outlook on Minor International (SET: MINT) following the analysts meeting after the company reported robust earnings for its 2024 operations along with strong guidance for the next three years.
MINT is expected to achieve a net profit CAGR of 15-20% during 2025-27. The company targets revenue CAGR of 6-8% and normal profit CAGR of 15-20% during the same period
MINT aims to increase operating leverage through back-office improvements and focus on asset-light business expansion to boost management fee income.
The company intends to reduce financial costs by accelerating debt repayments and actively recycling capital through asset rotation and REITs. The company expects to decrease its net IBD to equity ratio from 0.8x in Q4 2024 to 0.75x by 2025
Hotel Business Expansion:
MINT plans to increase its total room count from 81,344 in Q4 2024 to 127,862 by 2027, emphasizing an asset-light model for hotel expansion over the next three years. The company is targeting high-growth potential markets in Europe, the Middle East, Asia Pacific, North America, and new regions.
Minor Food Expansion:
MINT plans to increase the number of branches from 2,699 in 2024 to 4,114 in 2027, primarily through franchising. The company aims to increase its asset-light ratio from 48% in 2024 to 56% in 2027. MINT is targeting markets such as Thailand, CLMV countries, Indonesia, and India.
Impact of “The White Lotus” Series:
The television series “The White Lotus” is expected to redefine Thailand as a high-end luxury destination and positively impact Minor’s four hotels featured in the series. The series has already shown initial positive effects, with ADR (Average Daily Rate) increasing by 40% year-on-year.
Additionally, Kasikorn Securities reiterated its “Buy” recommendation for MINT with a target price of Bt43.02, representing 55% upside from the closing price of Bt27.75 per share on Monday. The positive outlook is based on MINT’s strategy to increase operating leverage through the asset-light model. The stock is currently trading at a PER (Price-to-Earnings Ratio) of 18.1x for 2024 and 15.9x for 2025.
