Non-bank share prices are weak after the OCPB has yet to come to a conclusion about setting the interest ceiling inconsistently and all parties are waiting for clarity. While many stocks ran to receive news during March before retreating in a later period Brokers assess MTC is less pressured than MTC market forces in a limited range, while directly affecting total revenue. and profitability potential of SAWAD. Other nonbank stocks are affected in proportion to the loan portfolio. The leasing business executives rushed to find a solution. Emphasis on personal loans to reduce risk
After the Consumer Protection Board (Board of OCPB) has notified the results of the board meeting on June 22, 65, and there has been no conclusion on the interest ceiling on motorcycle hire purchase. and some issues The original leasing interest ceiling has been concluded for the new car leasing interest rate of 15%, used cars 20%, but the motorcycles have not yet been agreed upon. Because the working group proposed to collect at 26% while entrepreneurs proposed at 30%, with the meeting asking to collect all the information again. Therefore, a new meeting was scheduled to consider the aforementioned matter and it was expected that a conclusion would be reached soon.
from Survey of stock prices of companies listed on the stock exchange or major companies assessed by various brokers It is expected that there will be both positive and negative results from the determination of the hire purchase interest ceiling under the aforementioned measures. Between March and June, it was found to fade. Even before that, the share price increased. But..when there is no conclusion, the share price is fading, such as TIDLOR or Ngern Tilor Public Company Limited from the beginning of March, trading at 40 baht and in June, the share price trades at 29.50 baht, followed by SAWAD or the company. Srisawad Corporation Public Company Limited trades at 58.50 baht, slightly declining on some days. But still trying to stand at the level of 50 baht, while MTC or Muang Thai Capital Public Company Limited traded around 51.75 baht, passed in June, the price weakened, until it traded at 44 baht, while TK traded at 11.80 baht. Considered that the share price of TK or Thitikorn Public Company Limited is not far off. because it’s been a month Jun. The share price traded at 10.70 baht and along the way, the share price didn’t go up and down like the others in the last group, NCAP or Next Capital Public Company Limited traded at 9.70 baht. Arrived in June. . Trading at 5.30 baht, moderately declining.
MTC is less pressured than market forces.
KGI Securities (Thailand) Assessment after the Office of the Consumer Protection Board or OCPB is in the process of finding a conclusion about setting the interest rate ceiling on leasing loans. which is a matter of debate for a long time Attempts have been made to impose a ceiling on leasing/leasing interest for a very long time and the process has been. back to consideration after the end of the procedure Listening to opinions from entrepreneurs
Operators offer a ceiling of 30%, but regulators will set a ceiling of 26%, regardless of the final interest ceiling. The new interest rate will change the market mechanism of H/P business. especially companies in the small motorcycle leasing group But it will affect the leasing business for new or used cars is not much. because the current interest rate is lower than 26% The setting of the interest ceiling will affect SAWAD but not MTC because motorcycle leasing operators such as TK, S-11, S-cap (subsidiaries of SAWAD) charge motorcycle loans higher than 30%. much more As for SAWAD, there is a plan to accelerate this business expansion. to drive long-term growth It will focus on expanding this group of loans rather than the growth rate of registered mortgage loans. SAWAD extended this group of loans by setting an initial interest rate of 30%. However, MTC extended the motorcycle loan by charging interest only 20-24%, which is lower than the rate that the unit Regulatory work suggests, so companies are less pressured on this issue than market forces. and business competition conditions will change
KGI Securities considers the performance of the leasing company. It is found that the current loan yield is around 30% plus or minus, and if you combine income, fees and other income, it will be much higher. cost of each company (including operating expenses, finance costs, provisions) as a percentage per loan It was found that credit cost was the highest proportion of expenses at about 15% of loans, as can be seen from TK and S11 in while the ratio of operating expenses/credit has different highs and lows. Leasing-only stocks will turn to losses, while SAWAD margins will be low but MTC will not be affected.
Nonbank group affected
Kasikorn Securities Public Company Limited stated that the weight of the meeting OCPB to the case of motorcycle hire purchase interest ceiling Entrepreneurs have asked for 30% while the working group of the OCPB wants to press the ceiling on the first-hand motorcycle interest at 20% per year. Assessing that this will affect only companies that provide motorcycle leasing, such as Srisawad Corporation Public Company Limited or SAWAD because There is approximately 17% of the motorcycle leasing portfolio in 2022, while Muang Thai Capital Public Company Limited (MTC) has only 5%.
Kasikorn Research Center Nonbanks are expected to be affected by signs of a policy rate hike in the second half of 2022 after the June 15 Fed meeting saw interest rates rise to 0.75% and Thai inflation remained high. With the direction of the domestic policy interest rate entering an uptrend during the rest of this year May reiterate the picture of non-bank financial costs that have risen significantly since the beginning of 2022.
especially companies that raised new capital through issuing debentures to support business expansion and redemption of existing debentures. Although the impact of the interest rate hike on the hire purchase business on the financial cost of the commercial bank operators will still be raised not much as interest rates on deposits remained at a low level. There is also an extension of the time to reduce the contribution to the FIDF at the rate of 0.23% per annum until the end of 2022.
Asia Plus Securities Company Limited I think that the large non-bank groups are starting to become interesting. After the price continued to decline from concerns about rising interest rates see that the impact is still in a limited range this year Because the operator has already locked interest costs. by issuing debentures at the beginning of last year It is expected that it will have a big impact in 2023 after the interest rate hike in the second half of 2022, and assess the impact of the interest rate hike on the nonbank group. In the event that the interest rate increases every 0.25%, it will affect the net profit of the nonbank group on average 1%. For example, SAWAD affects the least 0.5%, TIDLOR affects 1.1%, MTC affects profit 1.25%.
TIDLOR insists that it will not affect the business
Piyasak Ukritnukul, President Ngern Tid Lor Public Company Limited or TIDLOR Show confidence and not worry about the situation. because of the present The business’s loan portfolio grows primarily from loans with vehicle registrations as collateral. In addition, the majority of the Company’s hire purchase portfolio is truck hire purchase. which does not meet the CPB’s control criteria for the loan balance Continue to grow steadily according to the plan that has been set especially the expansion in the credit card group for both motorcycles and cars that received good feedback from the market. with products that satisfy customers to increase convenience Able to withdraw the remaining balance 24 hours 7 days through more than 50,000 ATMs nationwide. and in terms of insurance premiums Growing not less prominently as well Prominence with car insurance Divide the premium payment by cash for up to 10 months. Any premium can be divided by 10. There is no condition. pay the same every period no credit card required Protection as soon as the insurance premium is paid from the first installment By the past June The company has just released the logo of its subsidiary brand. “Insurance on wheels”, a comprehensive insurance broker official Reinforcing its position as the No. 2 leader among retail-focused insurance brokers Along with being confident that the overall performance of the company this year will continue to grow as the target set.
MTC dreads setting high ceilings People have difficult access to credit.
Chuchat Petampai, Chairman of the Executive Committee, Muang Thai Capital Public Company Limited or MTC Consider the trend that the Office of the Consumer Protection Board or OCPB will set interest rates on loans. The maximum leasing of motorcycles at 20% is for the OCPB to consider controlling interest rates. to be between 25-30%, which is an appropriate rate for entrepreneurs in managing portfolio risks
“This case has been discussed continuously. The entrepreneur would have to wait for clarity from the OCPB mainly, but if the interest ceiling is set so low that The operator cannot bear the risk. People will find it more difficult to access credit.”
Currently, MTC has a loan portfolio of 100 billion baht, which is a hire purchase loan of 5% of the total loan portfolio. Which carries an interest rate of about 22-24%, while most of the portfolio’s loans are still car registration loans. and other types of loans approximately 15% initially, the Company will continue to provide hire purchase loans To help people have motorcycles to continue their careers amid the economic recovery
SAWAD – BFIT merges with SCAP for retail loans
Sawthida Kaewbutta, Corporate Strategy Director, Srisawad Corporation Public Company Limited or SAWAD Revealed that the SAWAD group is preparing to adjust its strategy to support the criteria to control the hire-purchase interest rate ceiling of the OCPB, but the Thai economy has recovered strongly. After the government declared COVID-19 endemic and accepting tourists back in as well as the opening of entertainment venues and the opening of various activities, making the trend bright and SAWAD continues to use income-based lending criteria. and credit repayment potential of target customers in all groups Ready to go through all sales channels, both online and direct sales, including accepting motorcycle dealerships, electrical appliances across the country In order to cover the district level according to the goals of both SAWAD, which has nearly 5,000 branches nationwide and more than 1,000 branches of the Government Savings Bank, along with adjusting the collection guidelines to be flexible with each situation Therefore, it is confident that the ratio of bad debt (NPL) in year 20 will be equal to year 64 or not more than 3.71%, while the loan portfolio is expected to be 20-30%.
Recently, SAWAD returned the finance business license of Srisawad Finance Public Company Limited or BFIT, approved the transaction to purchase all ordinary shares in Srisawad Capital Company Limited (SCAP) and allocate newly issued ordinary shares to a specific investor ( Private Placement : PP) to pay as compensation for the purchase of all ordinary shares in SCAP according to the Group’s business restructuring plan. Due to the current economic conditions and operating requirements, the Group has to slow down credit and strict credit approval requirements. This affects the company’s future business policy that may not be flexible. and plans for new business in hire purchase and personal loan services instead, which are more flexible in operations It is expected to be allowed in the third quarter of this year.
For the merger, SAWAD will exchange shares by acquiring 487 million newly issued ordinary shares of BFIT at a price of 24 baht per share, which is a PP allocation as compensation for the sale of 39 million SCAP shares held by the company. to BFIT instead of paying by cash The total value of the transaction is 11,700 million baht, which is considered a fair value for both businesses, thus BFIT and the Company have no obligation to finance the transaction. BFIT will benefit from a proportionate stake in SCAP, while BFIT will benefit from a leveraged capital base with high growth potential. The shareholding structure and business of the Group will be clear. Helps reduce conflicts of interest making it grow more stable
NCAP takes on personal loans
for Next Capital Public Company Limited or NCAP Recently appointed Punnamas Wichitkulwongsa To hold the position of Co-CEO (Co-CEO) effective from June 7, 2021 onwards to enhance the Group’s personal loan business expansion plan. After the company set up “Next Money Company Limited”, a new company in the group with a registered capital of 50 million baht to expand the business. and increase revenue and profit recognition channels Other than just doing motorcycle hire purchase business Because after the outbreak of the covid-NCAP Manage work with caution and looking for new opportunities to expand the company’s growth as targeted
As for NCAP, it operates in new motorcycle hire purchase business, accounting for approximately 99% of the total receivable portfolio. It is the company’s main business. In addition, it also operates second-hand motorcycles. and other products that have market opportunities There are 24 branches spread all over the country. In addition, there are car dealers as partners of the company. in various areas, about 600, which the company is strong and the leader in the southern region Focus on expanding new areas Support for loan portfolio growth this year and expanding products and services to cover more especially the main business of providing loans for hire purchase of new motorcycles. Covers small to large motorcycles
In this regard, the broker sees If the OCPB imposes a maximum interest rate control ceiling of 20%, it will affect MTC’s profitability in a limited range, while directly affecting both total revenue. And the profit potential of SAWAD preliminary is expected to affect profits by about 15%, including TK or Thitikorn Plc. and NCAP or Next Capital Plc., which will be affected according to the condition of the company’s credit portfolio.
