RT Confirms 20% Growth in 2021 Revenue, Analyst Recomm. “BUY” with TP at ฿3

Mr. Surasak Seekhiew, Managing Director of Right Tunnelling Public Company Limited (RT), revealed that for the 2021 earnings outlook, the company has set a revenue growth target of 3,000 million baht in 2021, an increase of 20% from the year 2020. 70% of total revenue this year is expected to come from the current 3,552 million baht backlog, while another 30% will be from future projects. 


Also, RT is confident that it will be the winner for the 72.9-billion baht Den Chai-Chiang Rai-Chiang Khong double-track railway project bidding as this project comprises tunnels with a total length of 22 kilometers and RT is an expert in the tunnel construction.


KTBST Securities (KTBST) maintained a “BUY” recommendation on RT, but raised a target price to ฿3.00/share from ฿2.50/share and 2021E PER re-rates to 13x as it foresaw a possibility to acquire Den Chai-Chiang Rai-Chiang Khong railway project is high, while the current backlog is high. 


Overall, KTBST was positive about RT’s earnings outlook following SET Opportunity Day yesterday (March 23). First, RT has set a revenue growth target at 20% YoY to be contributed from the existing backlog (70%) and new backlog (30%). Second, the company is confident to acquire Den Chai-Chiang Rai-Chiang Khong railway project whether in terms of main or subcontractor and lastly, RT is also confident to win some part of Luang Prabang project.   


Additionally, KTBST reiterated a net profit forecast in 2021 of 250 million baht (+6% YoY).

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