Stock Dimension – TTW from Dao Securities (Thailand) said it maintains a “Hold” recommendation and a target price of 9.70 baht based on SOTP. We consider it neutral from the SET Opportunity Day meeting on Friday (22 December) with’ r issue Important points are as follows: 1) Set a target for tap water sales in 2024E to be stable YoY, slightly lower than expected at +2% YoY from the industrial sector (38% of total water users in the Nakhon Pathom-Samut Sakhon area and 19% of total water users in the Pathum Thani-Rangsit area) which is still slowing down But this will be compensated by an increase in households, 2) El Nino affects the volume of the water in 4 main dams, decreasing -12% YoY and the usable water volume is weakening -18% YoY, but it is still not a concern, and 3 ) still looking for new investment that is in the water supply business , waste water treatment and water management
Therefore maintaining net profit in 2023E at 2.7 billion baht (-10% YoY) and 2024E at 2.5 billion baht (-8% YoY) In 2024E, the slowdown was mainly due to the decrease in the selling price of PTW water following the new concession on for Q4 /23E Preliminary profit is estimated to be slightly better than expected at around 580-620 million baht (originally expected to be 560 million baht), growing YoY but slowing QoQ in line with lower water selling prices and seasonal factors. CKP.
As for the stock price, outperforming SET + 13% in 6 months from positive news about PTW’s new concession expansion but in line with SET in 1 month. We maintain our “Hold” recommendation even though the 2024E profit trend is weak from the base of the new concession water sales price But consider that the price shares at the moment which was trading at -2SD only, reflecting negative factors to some extent Although the company can consider new projects after i PTW concession expansion be resolved.
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