HILITE: SCC plus 1.91% gaining strong buy back, outstanding brokerage Anti

SCC plus 1.91% or an increase of 7.00 points to 373.00 baht, trading value 684.31 million baht, with the opening price of 374 baht, the highest price 374 baht, the lowest price 372 baht.

DBS Securities, Vickers, stated in the analysis of the stock The Siam Cement Public Company Limited (SCC) is an outstanding stock. Anti-Commodity Good growth in cement demand from government projects Despite having some negative impact from the PE and PP spreads, it gradually improved because it benefited from the lower oil prices helping to save energy costs. and the share price is cheap The current price has a P/E this year of 11 times, lower than those in the region at 13 times, and expects DY to be good at 4% per year, and there is a stimulus factor that is listing SCGC in the market as well, giving a base price of 464 baht.

While KTBST Securities Positive outlook on SCC’s FY66 earnings recovery based on 1) Petrochemical business that will benefit from new capacity additions. In addition, the price spread should be recovered due to the declining new supply. 2) Cement-Building Materials Business should see an acceleration in demand while the pressure factor from coal prices will be less from this year; and 3) the packaging business should have higher sales volumes in accordance with the continuous capacity expansion plan. and the cost of waste paper decreased after the COVID-19 situation resolved.

It is estimated that SCC will report a net profit of 65-66 at 38.2 billion baht and 451 billion baht, compared with 4.72 million baht in 2020. We believe profits will drop 19% YoY in 65, mainly from 1) petrochemical price. lower spread due to incoming new supply; and 2) high cost of transportation and waste paper costs.

However, we expect the company to see a rebound in profit in FY23, driven by 1) higher petrochemical sales volume from the start of the LSP Petrochemical Complex project 2) better petrochemical price spread 3) high sales value. up CBM and 4) SCGP higher sales volume SET outperform share price +1.4% over the past 6 months in line with stable petrochemical price spreads. Current price reflects 2023 PBV of just 1.08x (about -1.75SD low. than the average of the past 5 years)

However, we think that the current price is attractive. Although there is no catalyst in the short term, we expect earnings to recover in ’66 thanks to recovering petrochemical profits. and there is a possibility of listing SCG Chemicals Co.,Ltd. (SCGC) on the stock exchange within the first half of ’66

Recommend “Buy” at the ’66 target price of 440.00 baht, based on the SoTP method.