THAILAND EQUITY RESEARCH 

 

Page | 1 | PHILLIP SECURITIES (THAILAND)  

Thanachart Capital  Loan and earnings look gloom in 4QF15 

THAILAND | SET | BANK | COMPANY PREVIEW BLOOMBERG TCAP TB l REUTERS TCAP.BK 

Loan contracts 0.1% m‐m in November but likely to recover in December  TCAP  reported a 0.1% m‐m decrease  in  its November  loan but  the pace of decline  slowed down compared to a 0.6% in October. However, its YTD loan fell by 6% from end‐2014.   We  expect  loan  to  pick  up  in  December  on  the  holiday  shopping  season  and  potentially stronger demand at the country’s big event Motor Expo. Even so, it won’t be enough to push the whole‐year back to positive territory. For 4QFY15, we expect loan to contract by 0.3% q‐q.  4QFY15 net profit to fall y‐y, q‐q on loan contraction and high expenses We expect 4QFY15 net profit  to  fall by 10.4%  y‐y  and 10% q‐q  to Bt1.2bn  in  view of  loan contraction and high expenses in 4QFY15, while loan‐loss provision is likely to stay high. High provision appears to be a key factor to our y‐y decline estimate, while high expenses during late year, despite potentially  lower provision, will  likely be a key  culprit  to our q‐q decline forecast.  FY15 net profit seen up 3.4% to Bt5.3bn, below our previous forecast of Bt5.5bn We cut our net profit forecast from Bt5.5bn to Bt5.3bn, representing a growth of 3.4% y‐y, to price  in  higher  expense  in  late  year. We  expect  TCAP  to  provide  an  annual  dividend  of Bt1.60/share,  currently  translating  to  a  yield  of  4.8%.  The  bank  already  paid  an  interim dividend of Bt0.70/share.  For  2016,  we  forecast  net  profit  at  Bt6bn  as  loan  is  expected  to  improve  and  loan‐loss provision would decline. We estimate dividend of Bt1.70/share, yielding 5.1%.  ‘BUY’ rating upgraded with Bt39/share target price  We  are  positive  about  TCAP’s  loan  growth  and  earnings  next  year,  and  TCAP  trades  at  a significant discount to our unchanged target price of Bt39/share. We upgrade our TCAP rating from an ‘ACCUMULATE’ to ‘BUY’ stance.       

                

Ref. No.: CO2015_00939  

Closing Price(Bt) 33.50

Target Price(Bt) 39.00 (+21.49%)

COMPANY DATA

O/S Shares (mn) : 1,278        

Market Cap. (Btmn) :

Market Cap. (USDmn) :

52‐WK Hi/Lo (Bt) : 36.5/28.25

3M Average Daily T/O (mn) : 3.91

Par Value (Bt) : 10.00

MAJOR SHAREHOLDERS (%)

1. Thai NVDR Co.ltd. 12.7

2. MBK Plc. 10.2

3. Thanachart Capital Plc. 8.8

PRICE PERFORMANCE (%)

1MTH 3MTH 1YR

ABS ‐4% 10% 12%

REL TO SET INDEX 17% 34% 14%

PRICE VS SET INDEX

Source: Bloomberg, PSR

KEY FINANCIALS

FYE Dec FY14 FY15E FY16E FY17E

Revenue(Btmn) 39,908 40,190 40,542 43,268

Net Profit(Btmn) 5,120 5,295 5,966 6,593

EPS (Bt) 4.01 4.14 4.67 5.16

P/E (X) 8.4 8.1 7.2 6.5

BVPS (Bt) 40.19 40.32 46.80 50.37

P/B (X) 0.8 0.8 0.7 0.7

DPS (Bt) 1.30 1.60 1.70 1.80

Dividend Yield (%) 3.9 4.8 5.1 5.4

ROE  (%) 5.13 4.97 5.26 5.41

Debt/Equity (X) 9.33 8.56 8.58 8.42

Source: Company, PSR Est.

**Multiples and yields are based on latest closing price

VALUATION METHOD

P/B'16 (0.9x)

Adisorn Mungparnchon

Securities Investment Analyst # 18577

Tel: 66 2 635 1700 # 497

39,031                                                            

1,082                                                               

06 October 2015

Buy (Upgraded from Accumulate)

17 December 2015

0102030405060

Dec‐12 Dec‐13 Dec‐14 Dec‐15

TCAP TB  EQUITY SETI (rebased)

THAILAND EQUITY RESEARCH 

 

 

PHILLIP SECURITIESS (THAILAND) | 2 | P a g e   

Thanachart Capital COMPANY PREVIEW

Income Statement

Btmn 4Q15F 3Q15 4Q14 q‐q+/‐ y‐y+/‐ 2015F 2014 y‐y+/‐Interest income 12,051 11,957 12,939 1% ‐7% 48,831 52,940 ‐8%Interest expense ‐5,075 ‐5,015 ‐6,164 ‐1% 18% ‐21,110 ‐25,475 17%Net interest incom e 6,976 6,942 6,775 0% 3% 27,721 27,465 1%Fees and service income 2,234 2,169 2,710 3% ‐18% 8,338 8,688 ‐4%Fees and service expenses ‐695 ‐675 ‐685 ‐3% ‐1% ‐2,725 ‐2,768 2%Net fees and service incom e 1,539 1,494 2,025 3% ‐24% 5,612 5,920 ‐5%Other non-interest income 1,345 1,464 1,370 ‐8% ‐2% 6,856 6,524 5%Total Incom e 9,861 9,900 10,169 0% ‐3% 40,190 39,908 1%Operating expense 5,140 5,020 5,215 2% ‐1% 20,265 19,830 2%Pre provioning profit 4,721 4,880 4,955 ‐3% ‐5% 19,925 20,078 ‐1%Impairment loss of loans and debt securities ‐1,683 ‐1,708 ‐1,576 1% ‐7% ‐8,570 ‐7,084 ‐21%Profit from operating before incom e tax expense 3,038 3,172 3,379 ‐4% ‐10% 11,355 12,994 ‐13%Taxation ‐395 ‐400 ‐657 1% 40% ‐441 ‐2,558 83%Minority 1,426 1,419 1,363 0% 5% 5,619 5,316 6%

Net profit  1,218 1,353 1,359 ‐10% ‐10% 5,295 5,120 3%

EPS  (Bt) 0.95 1.06 1.06 ‐10% ‐10% 4.14 4.01 3%

Key Financial Ratio

% 4Q15F 3Q15 4Q14 q‐q+/‐ y‐y+/‐ 2015F 2014 y‐y+/‐

Yie ld  on  Ea rning As s e t 5.04% 5.06% 5.25% 0% ‐4% 5.15% 5.36% ‐4%

Cos t of Fund 2.43% 2.43% 2.81% 0% ‐14% 2.54% 2.90% ‐12%

Spread 2.61% 2.63% 2.43% ‐1% 7% 2.61% 2.46% 6%

NIM 2.92% 2.94% 2.75% ‐1% 6% 2.92% 2.78% 5%

NPL 3.42% 3.42% 4.09% 0% ‐16% 3.61% 4.51% ‐20%

Balance Sheet 

Btmn 4Q15F 3Q15 4Q14 q‐q+/‐ y‐y+/‐ 2015F 2014 y‐y+/‐

As s e ts 986,633 982,280 1,025,684 0% ‐4% 986,633 1,025,684 ‐4%

Lia bi l i ti e s 877,992 875,207 921,408 0% ‐5% 877,992 921,408 ‐5%

Pa id ‐up  (mn  s hrs ) ‐ Pa r Bt10 1,278 1,278 1,278 0% 0% 1,278 1,278 0%

Equi ti e s 108,640 107,073 104,276 1% 4% 108,640 104,276 4%

BVPS  (Bt) 40.32 40.40 40.19 0% 0% 40.32 40.19 0%

Loan/depos i t (%) 112.5% 115.6% 116.5% ‐3% ‐3% 112.5% 116.5% ‐3%

THAILAND EQUITY RESEARCH 

 

 

PHILLIP SECURITIESS (THAILAND) | 3 | P a g e   

Corporate Governance ‐2015

ADVANC BAFS BCP BIGC BTS CK CPN DRT DTAC DTC

EASTW EGCO GRAMMY HANA HMPRO INTUCH IRPC IVL KBANK KCE

KKP KTB LHBANK LPN MCOT MINT MONO NKI PHOL PPS

PS PSL PTT PTTEP PTTGC  QTC RATCH ROBINS SAMART SAMTEL

SAT SC SCB SCC SE‐ED SIM SNC SPALI THCOM TISCO

TKT TMB TOP VGI WACOAL

AAV ACAP AGE AHC AKP AMATA ANAN AOT APCS ARIP

ASIMAR ASK ASP BANPU BAY BBL BDMS BECL BKI BLA

BMCL BOL BROOK BWG CENTEL CFRESH CHO CIMBT CM CNT

COL CPF CPI CSL DCC DELTA DEMCO ECF EE ERW

GBX GC GFPT GLOBAL GUNKUL HEMRAJ HOTPOT HYDRO ICC ICHI

INET IRC KSL KTC LANNA LH LOXLEY LRH MACO MBK

MC MEGA MFEC NBC NCH NINE NSI NTV OCC OGC

OISHI OTO PAP PDI PE PG PJW PM PPP PR

PRANDA PREB PT PTG Q‐CON QH RS S & J SABINA SAMCO

SCG SEAFCO SFP SIAM SINGER SIS SITHAI SMK SMPC SMT

SNP SPI SSF SSI SSSC SST STA STEC SVI SWC

SYMC SYNTEC TASCO TBSP TCAP TF TGCI THAI THANA THANI

THIP THRE THREL TICON TIP TIPCO TK TKS TMI TMILL

TMT TNDT TNITY TNL TOG TPC TPCORP TRC TRU TRUE

TSC TSTE TSTH TTA TTCL TTW TU TVD TVO TWFP

TWS UAC UT UV VNT WAVE WINNER YUASA ZMICO

2S AEC AEONTS AF AH AIRA AIT AJ AKR AMANAH

AMARIN AP APCO AQUA AS ASIA AUCT AYUD BA BEAUTY

BEC BFIT BH BIG BJC BJCHI BKD BTNC CBG CGD

CHG CHOW CI CITY CKP CNS CPALL CPL CSC CSP

CSS CTW DNA EARTH EASON ECL EFORL ESSO FE FIRE

FOCUS FORTH FPI FSMART FSS FVC GCAP GENCO GL GLAND

GLOW GOLD GYT HTC HTECH IEC IFEC IFS IHL IRCP

ITD JSP JTS JUBILE KASET KBS KCAR KGI KKC KTIS

KWC KYE L&E LALIN LHK LIT LIVE LST M MAJOR

MAKRO MATCH MATI MBKET M‐CHAI MFC MILL MJD MK MODERN

MOONG MPG MSC MTI MTLS NC NOK NUSA NWR NYT

OCEAN PACE PATO PB PCA PCSGH PDG PF PICO PL

PLANB PLAT PPM PRG PRIN PSTC PTL PYLON QLT RCI

RCL RICHY RML RPC S SALEE SAPPE SAWAD SCCC SCN

SCP SEAOIL SIRI SKR SMG SOLAR SORKON SPA SPC SPCG

SPPT SPVI SRICHA SSC STANLY STPI SUC SUSCO SUTHA SYNEX

TAE TAKUNI TCC TCCC TCJ TEAM TFD TFI TIC TIW

TLUXE TMC TMD TOPP TPCH TPIPL TRT TSE TSR UMI

UP UPF UPOIC UREKA UWC VIBHA VIH VPO WHA WIN

XO

Score Range

< 50%

50‐59%

60‐69%

70‐79%

80‐89%

90‐100%

The disclosure of the survey result of the Thai  Institute of Directors  Association (IOD) 

regarding corporate governance is  made pursuant to the Office of the Securities  and 

Exchange Commission. The survey of the IOD is  based on the information of a  company 

l isted on the Stock Exchange of Thailand and the Market for Alternative disclosure to the 

public and able to be accessed by a  general  public investor. The results, therefore, is  from 

the perspective of a  third party. It is  not an evaluation of operation and is  not based on 

inside information.

The survey result is  as  of the date appearing in the Corporate Governance Report of Thai  

Listed Companies. As  a  result, the survey result may be changed after that data. Phil l ip 

Securities  (Thailand) of securities  company does  not confirm nor certify the accuracy of 

such survey result.

No logo given

Number of Logo

Results Presentation

THAILAND EQUITY RESEARCH 

 

 

PHILLIP SECURITIESS (THAILAND) | 4 | P a g e   

Industry Group Name Sector Name Sector Index

Agro & Food Industry[AGRO]  Agribusiness AGRI

Food & Beverage FOOD

Consumer Products[CONSUMP] Fashion FASHION

Home & Office Products HOME

Personal  Products  & Pharmaceuticals PERSON

Financials  [FINCIAL] Banking BANK

Finance & Securities FIN

Insurance INSUR

Industrials  [INDUS] Automotive AUTO

Industrial  Materials  & Machinery IMM

Packaging PKG

Paper & Printing Materials PAPER

Petrochemicals  & Chemicals PETRO

Steel STEEL

Property & Construction[PROPCON] Construction Materials CONMAT

Construction Services CONS 

Property Development PROP

Property Fund & REITs PF&REIT 

Resources  [RESOURC] Energy & Util ities ENERG

Mining MINE

Services  [SERVICE] Commerce COMM

Media  & Publishing MEDIA

Health Care Services HELTH

Tourism & Leisure TOURISM

Professional  Services PROF

Transportation & Logistics TRANS

Technology [TECH] Electronic Components ETRON

Information & Communication Technology ICT

PSR Rating SystemCapital Gain Recommendation

> 15% BUY

> 5% ‐ 15% ACCUMULATE / TRADING BUY

> 0% ‐ 5% NEUTRAL

0 <= SELL

Remarks

We do not base our recommendations  entirely on the  above quantitative return bands.  We consider qualitative factors  l ike (but 

not l imited to) a  stock's  risk reward profi le, market sentiment, recent rate of share price appreciation, presence or absence of 

stock price catalysts, and speculative undertones  surrounding the stock, before making our final  recommendation 

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