JMT Continues on Growth Path in 2021, Analyst Recomm. “BUY” with a TP of ฿47


Analyst forecasts that JMT Network Services Public Company Limited (JMT) in 2021 is still on growth path, expecting a net profit of 1,391 million baht, an increase of 33% compared to a 1,047.04 million baht in 2020 driven by the distressed debt divisions, which have a portion of the debt that will fully amortize the investment value this year.

 

The debt collection is also expected to increase by a billion baht per quarter compared to a year earlier that has been affected by moratorium programs.

 

As of December 31, 2020, JMT’s total income was 3,190.75 million baht, increasing by 26.4% compared to the last year which had total income of 2,524.56 million baht, resulting in a net profit of 1,047.04 million baht and EPS of ฿1.15, up from a net profit of 681.36 million baht or EPS of ฿0.77 in 2019. 

 

The strong result was mainly from an increase in interest and dividend income and profit from loans on purchase of receivables due to the collection efficiency and the quality of the non-performing debt that JMT had acquired in the past year. 

 

By interest income and dividends and gains on loans from purchases of receivables accounted for 82.4% of total income. 

 

JMT stated that the profit from loans from the purchase of receivables which is the income of the non performing debt which has fully amortized the investment value increase. This is because the value of the debt pool has increased significantly during the years 2019 – 2020. 

 

Furthermore, JMT in 4Q20 has delivered a better-than-expected earnings of 330 million baht, an increase of 17% QoQ and 66% YoY. 

 

The Board of Directors of JMT approved a dividend payment from the second half of 2020 (June 1 – Dec 31, 2020) at rate of ฿0.41/share to be paid on May 5, 2021, with the EX-dividend date on April 21, 2021.

 

Trinity Securities maintains a target price of JMT at ฿47.00/share with a “BUY” rating in anticipation of a continued growth despite the share price has been increasing for a while.

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