Global Power Synergy - GPSC · 4/16/2015 · GPSC, via Natee Synergy, owns 25% of the project). We...

16 April 2015

Global Power Synergy

High voltage

TISCO Securities Company Limited is acting as financial advisor and lead underwriter for an offering securities by Global Power

Synergy Public Company Limited. Investors should read the information about the issuer and the securities offering in the

prospectus before making any investment decision.

IPO Report | GPSC

IPO

12 month Target Price Bt33

Price (IPO) N/A

CG Rating N/A

Sector ENERG

SHARE SUMMARY

Stock data:

Issued shares (pre-IPO): 374.58m

Issued shares (post-IPO): 1,498.30m

Par value: Bt10.0

Foreign Limit: n.a.

Foreign Ownership: 0%

Free Float: < 25%

Major Shareholders (Pre-IPO):

PTT 30.1%

PTTGC 30.3%

TOP 11.9%

Thaioil Power 27.7%

Major Shareholders (Post-IPO):

PTT 22.6%

PTTGC 22.7%

TOP 8.9%

Thaioil Power 20.8%

Public 25.0%

GPSC is a growth utility stock

Unlike other utility stocks in the Thai market, GPSC has an exceptional growth

outlook. We expect GPSC to raise its capacity by 41% by 2019, the highest in the

sector. GPSC also has a uniquely positive outlook as its major IPP power plant is still

in a flat earnings period while it is ramping up four projects which will contribute to

higher earnings in 2015-17F. With expected earnings growth of 14% p.a. (CAGR) in

2015-17F, GPSC is a prime growth utility stock in the sector.

Expanding capacity by 16% over the next 2 years

Over the next two years, or by the end of 2017, GPSC will raise its operating MW

capacity by 16% with the startups of 1) 125MW Nava Nakorn Electricity Generating

(NNEG) in 2016; 2) 240MW IRPC Clean Power (IRPCCP) in 2017 (Phase 1 for 40MW to

reach COD in 2015); 3) 65MW Nam Lik 1 Power (NL1PC) in 2017 and; 4) 117MW

Bangpa-in Cogeneration 2 (BIC2) in 2017. The above four projects combined are

215MW (+16%) net equity contribution to GPSC and will be the major driver for

earnings.

Most of the growth will be in 2019

Despite sizable expansion in the medium-term, most of GPSC’s capacity addition will

be in 2019 when the 1,285MW Xayaburi hydropower project is completed in Laos

PDR. This project is an IPP project, selling 1,220MW to EGAT and the other 60MW to

Electricite du Laos (EDL), and will add the other 321MW (+24%) to GPSC portfolio (as

GPSC, via Natee Synergy, owns 25% of the project). We expect GPSC to more than

double its 2020F earnings from its 2014 level (see Figure 8).

Our target price is based on DCF

We value GPSC at Bt33/shr, based on discounted cash flow method to reflect its PPA

contract-based cash flows. Assuming cost of equity (ke) of 9.9%, and no terminal

value for all of its power plants, we derive an enterprise value of Bt37bn for GPSC.

We also incorporate GPSC’s cash on hand (including assumed IPO proceeds) into our

target price, as we believe this is not captured in our DCF calculation (as we have not

assumed additional investments from this IPO proceeds). Note that we believe the

market is also likely to price-in the company's robust cash reserves.

CONSOLIDATED FINANCIAL SUMMARY

Year 2013 2014 2015F 2016F 2017F

Sales (Bt, m) 26,328 23,755 23,816 24,368 26,558

EBITDA (Bt, m) 2,907 2,858 3,101 3,370 3,161

Net profit (Bt, m) 1,161 1,578 1,961 1,952 2,313

Net profit (YoY%) n.a. 35.9 24.3 (0.5) 18.5

Basic EPS (Bt) 1.03 1.40 1.31 1.30 1.54

EPS (YoY%) n.a. 35.9 (6.8) (0.5) 18.5

PER (X) 29.0 21.4 22.9 23.0 19.4

PBV (X) 1.4 1.3 1.0 1.0 1.0

Yield (%) 0.0 0.3 1.3 1.3 1.5

ROE (%) 9.7 6.4 5.8 4.5 5.1

Source: TISCO Research Note: use average price for historical PER, PBV, yield

IPO Report | GPSC




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16 April 2015

High voltage

The biggest expansion in the Thai power sector

GPSC has a plan to expand its capacity by 41% over the next 4 years (see Figure 4). When

compared to the current plans of other listed power generation (powergen) companies, GPSC’s

target represents the highest growth in the sector. Based on company filings, GPSC currently has

1,351MW of electricity generation, excluding steam, chilled, and industrial water. By 2019, new

power plant startups should raise this number to 1,851MW. Over the next few years starting

2015, we expect to see a steady rampup of new projects which will show in company’s earnings

and dividends.

Figure 1. GPSC’s committed projects

1,000

1,200

1,400

1,600

1,800

2,000

2014 2015F 2016F 2017F 2018F 2019F

MW

Current NNEG IRPCCP NL1PC BIC2 XPCL

Source: TISCO Research, GPSC

Expanding capacity by 16% over the next 2 years

Over the next two years, or by the end of 2017, GPSC will raise its operating MW capacity by 16%

with the startups of 1) 125MW Nava Nakorn Electricity Generating (NNEG) in 2016; 2) 240MW

IRPC Clean Power (IRPCCP) in 2017 (Phase 1 for 40MW to reach COD in 2015); 3) 65MW Nam Lik 1

Power (NL1PC) in 2017 and; 4) 117MW Bangpa-in Cogeneration 2 (BIC2) in 2017– for more

detailed overview of each project, see Figure 18. In May 2015, IRPCCP will reach its first phase of

commercial operation by supplying 45MW and 180 ton/hr of steam to IRPC (who will complete its

UHV project in 3Q15). The above four projects combined offer 215MW (+16%) net equity

contribution to GPSC (i.e. GPSC doesn’t hold 100% in each of these projects).

Most of the growth will be in 2019

Despite sizable expansion in the medium-term, most of GPSC’s capacity addition will be in 2019

when the 1,285MW Xayaburi hydropower project (under Natee Synergy) is completed in Laos

PDR. This project is an IPP project, selling 1,220MW to EGAT and the other 60MW to Electricite du

Laos (EDL), and will add the other 321MW (+24%) to GPSC portfolio (as GPSC, via Natee Synergy,

owns 25% of the project).

Expect earnings rampup over the next 3 years

Even though the majority of the capacity expansion should be coming online in 2019, we believe

GPSC will see earnings improvement well before that, thanks to improving profitability in its

current portfolio of power plants. We expect the higher contribution from subsidiaries will help

offset the declining trend of IPT income (due to its front-loaded contract). In 2015, we forecast

income from subsidiary to rise to Bt764m (from Bt268m) thanks to 1) Bt250m higher dividend

income from RPCL (GPSC did not recognize this income last year) and; 2) Bt200m higher

IPO Report | GPSC




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16 April 2015

contribution from the steady rampup at BIC (117MW) and TSE (80MW solar), while the earnings

contribution from the partial (phase I) startup of IRPCCP would still be subdued. In 2017,

normalization of NNEG operations and the full IRPCCP startup would raise subsidiary income to

Bt1,251m.

Figure 2. GPSC’s revenue and EBITDA forecasts Figure 3. GPSC’s earnings forecasts

22

23

24

25

26

27

2013 2014 2015 2016 2017

Bt, bn

(0.5)

0.5

1.5

2.5

3.5

4.5

Bt, bnRevenues EBITDA (RHS)

0.0

0.5

1.0

1.5

2.0

2.5

2013 2014 2015 2016 2017

Bt, bn

Source: TISCO Research, GPSC Source: TISCO Research, GPSC

Expansion strategy on top of the committed projects

64-67MW projects near reality before others to go

On top of its committed projects, GPSC expects some 600-1000MW of additional opportunities to

arise domestically (new IPP bidding rounds, renewable energy projects) and regionally (solar

power in Japan and coal-fired power plant in Myanmar). The specific projects under study include

1) 6-9MW Waste-to-Energy projects in Rayong; 2) 40MW Central Utility Plant 4 (CUP4) plant in

Asia Industrial Estate, Rayong; 3) 18MW solar farm in Japan. In our view, since these projects are

either already in contracting or environmental permitting stage, the combined 64-67MW projects

under study are potential projects which could materialize over the next 1-2 years. We have not

valued these projects in our valuation section as we only value confirmed projects.

The advantage of being a PTT flagship

Given the group’s sizable planned expansions within the region, PTT has positioned GPSC as its

flagship power company and expects to leverage on GPSC’s current partners to accommodate the

group’s needs. For example, PTT is currently studying building a 660kbd refinery in Vietnam

(US$22bn investment) while PTTGC has petrochemical project ambitions in the US, Indonesia and

China.

Figure 4. GPSC’s investment plan

2,451-2,851

1,851

1,315

0

1,000

2,000

3,000

Existing Projects in

pipeline

New projects Others Others

Equity MW


IPO Report | GPSC




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16 April 2015

GPSC should be able to raise dividends

The IPO and the lower Capex burden should turn GPSC’s net debt position to negative (i.e. net

cash position) and allow GPSC to raise dividends this year. By assuming IPO proceeds based on our

fair value analysis, we estimate GPSC’s net debt position will turn to negative Bt9.6bn in 2015F

(Figure 5). This implies that the company has ample room to raise borrowing to fund its Capex

and/or raise dividends. Nevertheless, given our expectation that GPSC’s Capex burden will be

light, amounting to only Bt5bn over the next 3 years, hence allowing its free cash flow to turn

positive from this year onwards, we believe the company has ample room to raise dividends. In

Figure 7, we have assumed GPSC will raise its dividend payout ratio to 30% from 2015F, in line

with management guidance, and we believe this is rather conservative.

Figure 5. GPSC net debt should turn negative

(net cash) in 2015F

Figure 6. GPSC’s free cash flow should turn

positive in 2015F

(20)

(10)

0

10

20

2013 2014 2015F 2016F 2017F

Bt, bn

(0.4)

(0.2)

0.0

0.2

0.4

xNet interest bearing debt Net gearing

(8.0)

(4.0)

0.0

4.0

8.0

2013 2014 2015F 2016F 2017F

Bt, bn CFO CFI Free cash flow


Figure 7. Thailand’s electricity generation by scheme

0.0

0.1

0.2

0.3

0.4

0.5

2013 2014 2015F 2016F 2017F

Bt/shr

0

10

20

30

40

%DPS Payout ratio (RHS)


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16 April 2015

Figure 8. Key financial projections

Income statement (Bt, m) 2013 2014 2015F 2016F 2017F 2018F 2019F 2020F

Net sales 26,328 23,755 23,816 24,368 26,558 27,612 34,298 36,884

Cost of sales 23,321 20,622 20,513 20,791 23,171 24,261 30,624 33,373

Depreciation 1,016 1,043 1,385 1,415 1,442 1,477 1,503 1,537

SG&A 289 410 356 364 397 412 513 551

Other Income 189 135 153 157 171 178 221 237

Other Expense 0 0 0 0 0 0 0 0

EBIT 1,891 1,815 1,716 1,954 1,719 1,639 1,880 1,661

Associates 2 268 764 508 1,251 1,408 1,324 2,478

Interest Income 0 0 0 0 0 0 0 0

Interest Expense 618 470 519 509 552 479 406 333

Pretax profit 1,275 1,613 1,961 1,952 2,417 2,568 2,798 3,806

Tax 4 27 0 0 104 236 289 291

Minority interest 0 0 0 0 0 0 0 0

Net extraordinary items (110) (8) 0 0 0 0 0 0

Reported net income 1,161 1,578 1,961 1,952 2,313 2,332 2,509 3,515

Balance sheet (Bt, m) 2013 2014 2015F 2016F 2017F 2018F 2019F 2020F

Cash and marketable securities 6,390 3,421 25,299 23,126 26,088 29,898 33,047 35,393

Investment 906 182 182 182 182 182 182 182

Accounts receivable 4,999 3,013 3,021 3,091 3,368 3,502 4,350 4,678

Inventory 389 359 357 362 403 422 534 582

Total other current assets 1,808 1,170 731 753 776 799 823 848

Total current assets 14,492 8,145 29,590 27,513 30,817 34,804 38,936 41,682

LT Investment 1 2,687 2,687 2,687 2,687 2,687 2,687 2,687

Net tangible fixed assets 25,568 26,977 25,768 27,512 27,590 27,634 26,132 24,595

Net Intangible 27 73 73 73 73 73 73 73

Total other non-current assets 3,257 5,050 5,062 5,074 5,087 5,100 5,113 5,127

Total Non-current assets 28,853 34,787 33,590 35,346 35,437 35,494 34,005 32,482

Total assets 43,345 42,932 63,180 62,859 66,254 70,298 72,941 74,164

Accounts payable 4,769 3,483 3,520 3,570 3,957 4,138 5,165 5,612

Short-term debt 2,254 1,595 1,743 1,743 1,743 1,743 1,743 1,743

Total other current liabilities 673 127 131 135 1,702 3,689 4,491 4,522

Total current liabilities 8,056 5,205 5,395 5,448 7,402 9,570 11,400 11,877

Long-term debt 10,384 11,197 14,113 12,370 10,627 8,883 7,140 5,397

Total obligations 23 27 27 27 27 27 27 27

Total other non-current liabilities 520 486 82 85 1,650 3,636 4,437 4,465

Total Non-current Liabilities 10,927 11,710 14,223 12,482 12,304 12,547 11,604 9,889

Total liabilities 18,983 16,915 19,617 17,930 19,706 22,117 23,004 21,766

Issued and paid-up share capital 11,237 11,237 14,983 14,983 14,983 14,983 14,983 14,983

Share premium 3,393 3,393 14,622 14,622 14,622 14,622 14,622 14,622

Retained earnings 9,297 10,655 13,225 14,591 16,211 17,843 19,599 22,060

Shareholders' equity 23,927 25,285 42,830 44,196 45,816 47,448 49,204 51,665

Liabilities and shareholders' equity*

(incl. minority interest) 43,344 42,933 63,180 62,859 66,254 70,298 72,941 74,164

Cash flow statement (Bt, m) 2013 2014 2015F 2016F 2017F 2018F 2019F 2020F

Depreciation and amortization 1,161 1,578 1,961 1,952 2,313 2,332 2,509 3,515

Add back fx 20 8 0 0 0 0 0 0

Total other operating cash flow 522 1,171 0 0 0 0 0 0

Net change in working capital (200) 803 465 (53) 1,602 1,982 835 66

Capital expenditure 0 (5,619) (176) (3,159) (1,521) (1,521) 0 0

Net acquisitions/disposals 0 0 0 0 0 0 0 0

Total other investing cash flows (2,589) (2,058) 0 0 0 0 0 0

Change in borrowings 2,560 1,765 2,757 (1,743) (1,743) (1,743) (1,743) (1,743)

Equity raised/share buybacks 3,393 0 11,229 0 0 0 0 0

Dividends paid 0 (112) (588) (586) (694) (700) (753) (1,055)

Total other financing cash flows (2,606) (2,272) 0 0 0 0 0 0 Source: TISCO Research, GPSC

IPO Report | GPSC




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16 April 2015

Stagnant industry growth

No near-term industry catalyst; but this doesn’t bother GPSC

We don’t expect to see significant growth in the power sector any time soon as a result of

demand flattening out and near-term oversupply. In our view, this could help GPSC stand out

from its peers whose growth is constrained by capacity limitations. While Thailand’s power

demand grew at almost 5% p.a. from 2002-12 (see Figure 9), economic slowdown and political

turmoil have lowered power consumption growth to only 2% in 2015F (based on official

estimates). This is becoming an issue as powergen capacities have also expanded significantly

over the period (see Figure 10). As a result, the industry saw reserve margins climb to 23% (the

portion of powergen capacity not being utilized) in 2014, based on our estimates.

Figure 9. Thai power demand has grown 4.9% p.a. over the past 10 years

0

50,000

100,000

150,000

200,000

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

GWh Residential Small General Service

Business Industrial

Government and Non-Profit Agriculture

Other Free of Charge 10-yr CAGR: 4.9%

Source: TISCO Research, EPPO

Figure 10. Thailand’s power generation capacity has grown by 3.2% p.a. (Cagr)

0

10,000

20,000

30,000

40,000

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

MW Purchase Gas Turbine Diesel

Renewable Energy Hydropower Thermal

10-yr CAGR: 3.2%


IPO Report | GPSC




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16 April 2015

Expect the next IPP bidding in 2016

We believe the next round of IPP bidding, a historically significant industry event which adds

material capacity and is also a major catalyst to share prices, will still happen as the government

continues to support IPPs (see Figure 8) and its policy commands diversification into new fuel

sources. That said, we believe the likelihood of the event happening in 2015 is low. We believe

the new Power Development Plan (PDP), which we expect to be announced this year (dubbed

PDP2015), will result in a new coal-fired IPP bidding round sometime next year. This would create

an opportunity for GPSC to participate. While we believe this will be the single most important

share driver for GPSC, the actual income contribution from any such project is unlikely to

materialize in the next few years (or until the project is scheduled to begin operations). We also

believe competition for the project from contenders like EGCO and GLOW will be fierce.

Figure 11. Thailand’s electricity generation by scheme

0

50,000

100,000

150,000

200,000

1991

1994

1997

2000

2003

2006

2009

2012

GWh Hydro Fuel oil Lignite Gas Diesel Imported SPP IPP


Figure 12. Thailand installed power capacity by

segment (2014)

Figure 13. Natural gas is the primary source of

fuel for Thailand’s power generation (2014)

SPP

8%

IPP

39%

Import

7%

EGAT

46%

Natural gas

67%

Import &

others

7%

Oil

1%

Lignite/coal

21%

Hydro

4%

Source: TISCO Research, EGAT Source: TISCO Research, EPPO

IPO Report | GPSC




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16 April 2015

Valuation & Risks

We value GPSC using discounted cash flow

We value GPSC using discounted cash flow method to reflect its defensive (i.e. power demand is

not volatile), long-term (many projects last up to 25 years), and highly visible (as much of its sales

is based on PPA contracts) business. We believe discounting GPSC’s free cash flow to equity is

intuitive as it allows us to value each power project individually and reflects the project financing

nature of each without making assumptions regarding company’s debt levels. Assuming cost of

equity (ke) of 9.9% (based on risk-free rate of 2.5%, beta of 0.8x and market risk premium of

9.2%), and no terminal value for all of its power plants, we derive an enterprise value of Bt37bn

for GPSC. We also incorporate GPSC’s cash on hands into our target price, as we believe this cash

is not captured in our DCF calculation given that we have not assumed such cash to be put to

work (i.e. we have not assumed any additional projects above and beyond those that GPSC has

already committed itself). We also believe the market will price in such cash into the share price.

Figure 14. GPSC’s fair value calculation

Unit

Discounted cash flows (2015F) 37,208 Bt, m

Cash on hand (assume IPO proceeds) 12,404 Bt, m

GPSC fair value 49,612 Bt, m

Total number of shares (post-IPO) 1,498 Mil. shares

GPSC fair value 33 Bt/shr

Source: TISCO Research

Figure 15. GPSC’s fair value breakdown by project

NNEG

1%

IRPCCP

9%

XPCL

15%

NL1PC

1%

TSR

7%

CHPP

0%

BIC 2

0%

RPCL

4%

BIC 1

2%

IPT + PTTUT

61%


IPO Report | GPSC




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16 April 2015

Figure 16. GPSC’s FCFE calculations

2016F 2017F 2018F 2019F … 2030F … 2049F

IPT + PTTUT (324) 1,095 1,018 2,867 3,034 3,263

RPCL 288 209 211 176 161 0

CHPP (107) 4 4 (1) 45 0

BIC 1 61 57 11 55 54 0

BIC 2 0 0 0 0 0 0

NNEG (79) 39 48 46 55 0

IRPCCP (402) (31) 282 368 479 0

XPCL (1,102) (1,148) (1,183) (475) 1,824 0

NL1PC (77) 76 63 56 99 0

TSR 259 274 288 302 191 0

Total FCFE (1,482) 574 741 3,394 5,944 3,263


Risks

Key risks to GPSC are similar to the other stocks in the utilities sector, namely;

� Production disruptions/unplanned shutdowns which could result in penalties (for IPPs) and

lost opportunities for non-EGAT sales

� Contraction in power and steam demand from industrial customers (IC)

� Lower than expected returns on investments from construction delays/cost overruns

� Inability to pass through rising upstream gas costs (in the case of SPPs)

� A sharp rise in bond yields

IPO Report | GPSC




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16 April 2015

Company profile

Company description

GPSC has been founded on 10 January 2013 through the amalgamation between PTTUT and IPT to

be the PTT Group’s Power Flagship. The integration resulted in reaching a total generating

capacity of 1,039MW of electricity, 1,340 T/hr of steam, and 2,080 m3/hr of industrial water. Its

core business is to generate and supply electricity, steam, and industrial water to its customers

both electricity authority, namely EGAT, PEA, and MEA, and industrial users. Currently, GPSC has

total generating capacity of 1,315MW of electricity, 1,345 T/hr of steam, 12,000 RT of chilled

water, and 2,080 m3/hr of industrial water.

Figure 17. GPSC company overview

30.10% 30.31% 27.71% 11.88%

Electricity

Steam

Chilled Water

Under construction

Industrial Water

Capacity

Total Equity Capacity: Electricity ~1,851 MW: Steam ~1,512 T/H

: Industrial water ~2,080 Cu.m./H: Chilled water ~12,000 RT

Combined Cycle/

Cogeneration Power Plant Other Businesses

Solar Energy Power Plant

Hydroelectric Power Plant

Natee Synergy Co.,

Ltd.

Business Services

Alliance Co., Ltd.

24M Technologies, Inc.

5 MW

12,000 RT

240 MW

300 T/H

100%

51%

30%

25%40%

15%

25%

17%

100%

100%

125 MW

30 T/H

117 MW

20 T/H

1,400 MW

- T/H

80 MW

1,285 MW

25%

117 MW

20 T/H

40%65 MW

100% Sport Services Alliance Co., Ltd.

Operating*

SCOD: 2017

SCOD: 2016

SCOD: 2017

SCOD: 2017

SCOD: 2019

Operating

Operating

Operating

433 MW 172 T/H 12,000 RT 32 MW 347 MW

Note: *CHPP currently operates only Electric Chiller

1,039 MW

1,340 T/H

2,080 Cu.m./H

Rayong and Sriracha

Project % Holding by GPSC Total MW Equity MW

GPSC Owned-asset 1,039 1,039

CHPP 100% 5 5

IRPC-CP 51% 240 122

NNEG 30% 125 38

BIC1 & 2 25% 234 59

RPCL 15% 1,400 210

TSR 40% 80 32

XPCL 25% 1,285 321

NL1PC 40% 65 26

Total 4,473 1,851 Source: TISCO Research, GPSC

Detailed view of GPSC business operations

As per Figure 17, GPSC is an IPP-based powergen player in Thailand, with 69% (910MW) of its

equity-share powergen capacity selling under the Independent Power Producer (IPP) scheme. The

remaining 31% of GPSC’s powergen capacity sells to Small Power Producers (SPP) and Industrial

Customers (IC). GPSC is mostly gas-based, with 79% of its capacities fired by gas. All of the above

observations about GPSC would still hold true when we take into account the company’s

committed expansion plans (showing full effects in 2019), as we illustrate in Figure 20 and Figure

22.

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16 April 2015

Figure 18. List of GPSC power plants

Electricity

(MW)

Steam

(ton/hr)*

Demin water

(m/hr)*

Share-

holding (%)

Net equity

capacity (MW) COD** Scheme

Company-owned

IPP

Sriracha power plant 700 80 100% 700 2000 IPP

Cogen

PTTUT - CUP1 226 890 720 100% 226 2006 Cogen

PTTUT - CUP2 113 170 510 100% 113 2008 Cogen

PTTUT - CUP3 - 280 770 100% - 2009 Cogen

Total 1,039 1,340 2,080 100% 1,039

Investment companies

Combined cycle/Cogeneration

Ratchaburi Power (RPCL) 1,400 - - 15% 210 2008 IPP

Combined Heat and Power Producing (CHPP) 5 - 12,000 100% 5 2009 VSPP

Bangpa-in Cogeneration (BIC) 117 29 - 25% 29 2013 SPP (90MW), IC

Bangpa-in Cogeneration 2 (BIC2) 117 29 - 25% 29 2017

Nava Nakorn Electricity Generating (NNEG) 125 30 - 30% 38 2016 SPP (90MW), IC

IRPC Clean Power (IRPCCP) 240 300 - 51% 122 2017 SPP (180MW), IC

Solar

Thai Solar Renewable (SSE1) 80 - - 40% 32 2012 VSPP

Hydro

Natee Synergy (XPCL) 1,285 - - 25% 321 2020 IPP

Nam Lik 1 Power (NL1PC) 65 - - 40% 26 2017

Total 3,434 388 12,000 24% 813

Total GPSC capacity 4,473 1,728 14,080 41% 1,852


Figure 19. Breakdown of existing capacity by

output buyer

Figure 20. Breakdown of 2019 capacity by output

buyer

IPP

69%

SPP

26%

Others

5%

IPP

67%

SPP

19%

Others

14%

Source: TISCO Research, GPSC (Others include power plants with mixed buyers including PEA, MEA

(as in the case of renewable energy projects), and industrial customers

Source: TISCO Research, GPSC (Others include power plants with mixed buyers including PEA, MEA

(as in the case of renewable energy projects), and industrial customers

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16 April 2015

Figure 21. Breakdown of existing capacity by fuel

type

Figure 22. Breakdown of 2019 capacity by fuel

type

Gas

79%

Hydro

19%

Renewable

2%

Hydro

12%

Renewable

11%

Coal

12%

Gas

64%


Map of GPSC power plants

Figure 23. GPSC’s portfolio of power plants


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16 April 2015

Ownership structure

GPSC is owned by four shareholders namely PTT, PTTGC, Thaioil Power (TP) and TOP – see Figure

24. Since all four current (pre-IPO) shareholders of GPSC are PTT group companies, PTT effectively

holds 68% of GPSC. Since the IPO will create 375m new shares (equivalent to 33% of paid-up

shares pre-IPO), we estimate PTT ownership would be diluted to 51% post-IPO.

Figure 24. Shareholding (pre-IPO) Figure 25. Shareholding (post-IPO)

PTTGC

30.3%

Thaioil

power

27.7%

TOP

11.9%

PTT

30.1%

PTTGC

22.7%Thaioil

power

20.8%

Public

25.0%

PTT

22.6%

TOP

8.9%


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16 April 2015

TISCO Securities Company Limited

www.tiscosec.com

Bangkok

48/8 TISCO Tower 4th Floor, North Sathorn Road, Bangkok 10500, Thailand

Tel : (66) 2633 6999 Fax : (66) 2633 6490, (66) 2633 6660

Esplanade Branch

99 Esplanade Shopping Center, Room 202-2, 2nd Floor, Ratchadapisek Road, Din Daeng, Bangkok 10400

Tel : (66) 2641 3251, (66) 2641 3252 Fax : (66) 2641 3253

Chiang Mai

275/4, 2nd Floor, Chang Phuak Road, Chang Phuak, Muang District, Chiang Mai 50300

Tel. 0 5322 4722 Fax. 0 5322 4711

Nakhon Pathom

386, 388 Petchkasem Road, Prapatone, Muang District, Nakhon Pathom 73000

Tel: 0 3421 1812 Fax: 0 3425 1676

Nakhon Ratchasima

Tesco Lotus Korat, 719/5 Mittraphap Road, Naimuang, Muang District, Nakhon Ratchasima 30000 Tel: 0 4425 7752 Fax: 0 4425 3752

Udon Thani

227/21 2nd Floor, Udondussadee Road, Muang District, Udon Thani 41000 Tel: 0 4224 6888 Fax: 0 4224 5793

Score Range Level Description 90 - 100 5 Excellent 80 - 89 4 Very Good 70 - 79 3 Good 60 - 69 2 Satisfactory Corporate Governance Report 50 - 59 1 Pass of Thai Listed Companies 2014 < 50 n.a. n.a. N/R Does not appear in the CGR report

Disclaimer

The disclosure of the survey result of the Thai Institute of Directors Association (“IOD”) regarding corporate governance is made pursuant to the policy of the Office of

the Securities and Exchange Commission. The survey of the IOD is based on the information of a company listed on the Stock Exchange of Thailand and the Market for

Alternative Investment disclosed to the public and able to be accessed by a general public investor. The result, therefore, is from the perspective of a third party. It is

not an evaluation of operation and is not based on inside information. (In order to recognize well performed companies, companies classified into the three highest

score groups (Good, Very Good, and Excellent) will be announced to the public).

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

date. TISCO Securities Company Limited does not confirm nor certify the accuracy of such survey result.

The information, statements, forecasts and projections contained herein, including any expression of opinion, are based upon sources believed to be reliable but their accuracy completeness or

correctness are not guaranteed. Expressions of opinion herein were arrived at after due and careful consideration and they were based upon the best information then known to us, and in our

opinion are fair and reasonable in the circumstances prevailing at the time. Expressions of opinion contained herein are subject to change without notice. This document is not, and should not be

construed as, an offer or the solicitation of an offer to buy or sell any securities. TISCO and other companies in the TISCO Group and/or their officers, directors and employees may have positions

and may affect transactions in securities of companies mentioned herein and may also perform or seek to perform investment banking services for these companies. No person is authorized to

give any information or to make any representation not contained in this document and any information or representation not contained in this document must not be relied upon as having been

authorized by or on behalf of TISCO. This document is for private circulation only and is not for publication in the press or elsewhere. TISCO accepts no liability whatsoever for any direct or

consequential loss arising from any use of this document or its content. The use of any information, statements forecasts and projections contained herein shall be at the sole discretion and risk of

the user.

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