Stock dimension – Asia Plus Securities Co., Ltd.
Expanding production capacity … poised for long-term growth
4Q22 net profit was 368 million baht (below expectations), down 30% qoq and 39% yoy The impact of the average selling price of para rubber in 4Q22 decreased 12% qoq and 8% yoy to 51.5 baht/kg. in 4Q22 has weakened. NER has announced the construction of a third rubber works block with a capacity of 170,000 tonnes per year, increasing NER’s production capacity by 32% from the current one Production is expected to start in 1Q24 by the research department. not included in the estimates
Net profit in 2023 is expected to increase 19% yoy, driven by a 14% yoy increase in para rubber sales volume and economies of scale. Expected net profit for the 1Q23 period will grow from the 4Q22 period of the gross profit trend for the 1Q23 period recovering in line with the world rubber price direction. NER announced a dividend payout for the 2H22 period equal to 0.31 baht, representing a Div yield of 5.3%, up XD on 20 Apr 23 recommended. buy
Maybank Kim Eng Securities
keep advice BUY 8.70 baht
- The 4th quarter is believed to be the bottom for rubber and GPM prices, with earnings peaking in the 3rd quarter since January 2023. Chinese orders are tight, both in the city and in EVs. Although 1Q23 volume is shortened from 4Q22, but the recovery GPM is seen as profit What will begin to recover QoQ and move forward this year?
- The company is preparing to expand new production margin +33% another 1.7 hundred thousand tons, spending 700 million baht, completed 1Q24, using internal cash flow. And loans, this issue is new beyond expectation.
- Capital increase with PP mandate 8.7% still asking to hold the decision for capital preparation, reduce interest burden, expand w/ci reduce D/E ratio
*** NER announced a 2H22 dividend payment of 0.31 baht, representing a Divisional yield of 5.2%,XD 20 Apr 23
Pi Securities
“4Q22 is not good because of the selling price”
We maintain our BUY recommendation and base valuation at Bt8.50, excluding capital increase shares for sale to foreign funds. If the underlying value is included, it will be 7.10 baht from the previous 8.90 baht (8XPER’23E). Recommend buying for short-term dividends with a yield of more than 5%. Soon, the company received more orders in the future, leading to the expansion of new production capacity by announcing the construction of the 3rd factory. This will increase production capacity by 33%.
UOB Kay Hian Securities (Thailand)
The best place to buy has arrived.
4Q22 earnings fell 39.6% yoy and 30.4% qoq below expectations. Mainly pressured by lower ASPs and GPM following rubber price trends in 3Q22, the research department has revised down 2023-24 projections by 9% and 7%, respectively, with profits in 2023 still growing 14% yoy, driven by expanding yoy sales volume but believes it will start to see a better recovery in 2Q23 as rubber prices start to recover from late 2022 while the new target price of 7.6 baht still has a profit + sy Attractive, repeat BUY.
Yuanta Securities (Thailand)
Maintain purchase recommendation 9.70 baht
We expect normalized earnings in 1Q23 to return to above Bt400mn from an average selling price recovery of around 10%, while sales volume is expected to stabilize to slightly increase QoQ, resulting in earnings recovery of 20% +/- QoQ and flat YoY. a sales volume target of 500,000 tonnes in 2023 is still higher than our estimate of 480,000 tonnes and the revenue target is 30 billion baht, higher than our estimate of 28.5 billion baht. Therefore, we maintain our 2023 profit forecast at 2,200 million baht. (+19.2% YoY) maintains 2023 year-end target price of 9.70 baht, maintains BUY recommendation Current price trades at only 4.90x PER2566 and expected dividend for 2023 is 0.48 baht, yielding 8.1
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