“Next Capital (NCAP)” holds a good luck this November 9, ready to enter the trading board on the first day Highlighting a leading motorcycle loan – with branches nationwide Raising funds to expand credit portfolio With a major shareholder like COM7-SYNEX calling for confidence, the company gave the target of 2.84 baht.
* NCAP is ready for trading on the first day of this Nov. 9.
Mr. Manphong Senanarong Deputy Manager, Head of Issuer Division The Stock Exchange of Thailand disclosed that the Stock Exchange of Thailand (SET) welcomes the Next Capital Public Company Limited or NCAP to trade on November 9, 2020 by setting the price for offering ordinary shares to the public as First time (IPO), not more than 300 million shares, par value (par), 0.50 baht per share at IPO price 2.20 baht per share, registered in the financial / finance and securities business (FIN)
NCAP is a non-bank financial service provider and is not under the supervision of the Bank of Thailand and is currently one of the leading motorcycle hire purchase businesses. By focusing mainly on serving retail customers who want to own motorcycles By purchasing a car from a dealer (Dealer) and bringing it to customers for leasing By contacting local customers through dealer partners (Dealer) in different areas The company provides hire purchase loans for motorcycles such as Yamaha Honda, Vespa, Kawasaki and Suzuki, etc. through 24 branches nationwide.
* Bring funds to raise funds to expand credit portfolio 80%
NCAP Chief Executive Officer Somchai Limpattanasin revealed that the amount raised from the offering of securities before deducting expenses at this time, about 660 million baht, will be used as working capital to expand the credit portfolio of 80%. Repay 15% of the loan from financial institutions and invest in information systems to develop credit service and work support systems 5%, the estimated period of time within the year ’21 to support quality credit expansion plans. Increase competitiveness And have a good growth rate in the future
Currently, NCAP has a total credit portfolio of approximately 4,000 million baht and has approximately 100,000 account holders, with 24 branches spread across the country, as well as car dealerships as partners of the Company. In various areas of approximately 600 companies, which the Company has the strength and leadership in the southern region Ready to expand its credit portfolio and service to more regions with plans to expand 1 branch in the year 64 and 2 in the year 65
Including investments in information systems to improve work efficiency, including mobile applications and credit scoring systems, expected to be completed this year. And an enterprise resource planning (ERP) system is in progress. It is expected to be completed as planned next year, so we are confident that it will be a key factor in expanding the Company’s new credit portfolio. To grow exponentially in the year 64
* After entering the market, SYNEX – COM7 still holds a large share.
NCAP, formerly Buff (Thailand) Co., Ltd., is held by Mitsui & Co., Ltd.In 2017, NCAP changed its shareholding structure, where Mitsui sold its shares to a group of current major shareholders, Com7. Public Company Limited or COM7 and Synnex (Thailand) Public Company Limited or SYNEX, a listed company on the Stock Exchange of Thailand.
After listing, COM7 and SYNEX are still the major shareholders. With a ratio of 26.67% each or 240 million shares
* Boasting a gain of 74% Q2 / 63 profits – 6 months, 30% growth
Next Capital Public Company Limited or NCAP informed the Stock Exchange of Thailand (SET) that the operating results for the second quarter of 2020 had a profit of 33.79 million baht or 0.06 baht / share, an increase of 74.05% from the same period of the year 2019. Profit 19.42 million baht or 0.03 baht / share
Total revenue in Q2 / 63 increased 16.68% following an increase in hire purchase interest income. And debt collection income and bad debt income have been increased.
In the six-month period of the year 20, there was a profit of 70.65 million baht or 0.12 baht / share, an increase of 30.33% from the same period of year 2019 with a profit of 54.20 million baht or 0.09 baht / share, with revenue growing 16.46% following interest income and collection income. Same debt
In the year 19, there was a profit of 126.23 million baht or 4.21 baht / share, an increase of 40.41% from the year 2018 with a profit of 89.91 million baht or 3.53 baht / share, increasing in line with interest income. And bad debt income has been returned
* Highlighting strong credit strength in the southern zone
Finansia Syrus Securities Public Company Limited disclosed that NCAP’s main customers are retail tenants. It accounts for approximately 99% of the hire purchase receivables, and another 1% is corporate customers (B2B) and car rental operators.
In addition, there is a second hand motorcycle hire purchase loan service. Only cars that were owned by the company (Only 0.05% of the total income of hire purchase contract) and Refinance service for customers of the company with good repayment history. And there are other services related to business The amount of credit approved depends on the retail price of the car make and model in the market. With a loan term of 12-48 months
At the end of Q2 / 63 NCAP has a total of 24 branches spread across all regions. There are 7 branches in the south, which are considered quite strong in the South. Approximately 30% of all hire purchase loans are from the South, and there are more than 600 dealer partners in different areas nationwide. The company plans to expand 1 branch in Year 20 and 2 in the year 20 to potential areas.
* Expect profit this year to grow 28%, next year 35%.
Over the past three years (2017-19), the Company’s hire purchase interest income grew at an average of 50.4% CAGR following an increase in contract numbers. However, interest income and interest spread continued to decline from promotions to accelerate the expansion of customer base and credit portfolio. As a result, earnings grow at an average of 23% CAGR for the year 63-64. We expect a net profit of + 28% YoY and + 35% YoY, respectively, from the increase in new contracts. An increase in non-interest income And lower financial costs after entering the market
Valuation target price of 64 at 2.70 baht based on GGM method (Ke 6.75%, g 3%) and 64 Prospective EPS 0.24 baht, the target price is 11 times Implied PE, close to TK and S11 PE and is Implied PBV 1.6. Slightly below the mean of finance group of 1.8 times
* The target price for next year is 2.84 baht.
Asia Wealth Securities Co., Ltd. revealed that under the premise that the development of IT systems completed in the year ’64 estimates the loan growth in the year 63-65F, average growth of 20% CAGR, contributing to the PPOP and net profit growth. During this period, averaged 30% CAGR and 54% CAGR, respectively.The 20-year net profit is expected to be 162 million baht, expanding 28.7% YoY.
Although the loan contracted 5.5% YoY, it saw lower interest expenses. And losses from seized vehicles are expected to be reduced. Because during the epidemic of COVID-19 As a result, many manufacturers of cars and motorcycles had to stop producing. Resulting in surplus demand in the market Causing more customers to use secondhand motorcycles
The appraisal of NCAP at the end of the year is 2.84 baht, using BVPS Year 64 at 2.02 baht / share and PBV at 1.41 times (based on GGM: LT-ROE = 16%, Ke = 12% and TG = 3%). 0.83 times higher than the group mean, NCAP deserves to be traded on that PBV as it has an ROE that is only 6.52% above the group average.
It is expected that after the IPO, the company will have a gradual ROE from the year ’20 at 9.5% to 19.5% in the year ’65 and the trend of NIM to increase. While the debt to equity ratio from 2.9 times after IPO to 1.5 times, reflecting high liquidity. Able to find sources of funds to further the business growth in the future In addition, there is also a policy to pay dividend not less than 40% of the profit, so at an appropriate price of 2.84 baht, it will give a dividend yield of 4% in the year ’21.