Stocks in Focus on October 5, 2020: SCCC and VGI

Stocks in Focus on October 5, 2020: SCCC (Maybank Kim Eng TP at ฿180.00/share) and VGI (KGI Securities TP at ฿8.30/share).

Kaohoon Online has selected stocks with a high-growth potential for investors to consider on October 5, 2020.

 

Maybank Kim Eng has given a “BUY” recommendation on Siam City Cement Public Company Limited (SCCC) with a target price at ฿180.00/share.

Maybank expected a 3Q20 profit to slow to THB800m (-22% QoQ, -14% YoY), driven by performance improvement and cost reduction despite the overseas operations being severely hit by the Covid-19. Given an impairment of investment may be set aside in 4Q20, the 9M20 profit would account for 89% of the full-year forecast.

Maybank estimated a full-year profit of THB2.979b, slightly down 6%, giving an upside to the forecast and believed the company to return to pay dividend for yearly earnings.

The current share price is trading at an interesting valuation of 12x P/E, 8.1x EV/EBITDA, 1.1x P/BV and a 6.5% dividend yield. Reiterate BUY for investment, TP for 2021 is THB180, on average P/E – 0.5SD = 15.7x.

 

KGI Securities has given an “Outperform” rating on VGI Public Company Limited (VGI) with a target price at ฿8.30/share.

KGI expected VGI to report a 2Q20/21F (July 2020  September 2020) core profit of Bt18mn, recovering from a core loss of Bt104mn in 1Q20/21 but dropping from a core profit of Bt355mn in 2Q19/20. The recovery QoQ would be thanks to revenue increasing to Bt597mn (+34% QoQ) thanks to expected recoveries in both the OOH segment and digital services. The decline YoY would be due to revenue dropping 43% YoY.

KGI reiterated a rating of Outperform for VGI backed by i) earnings bottoming out since 1Q20/21, ii) expected turnaround in profit in 2021/22, and iii) upside from greater capacity and revenue in the transit segment along with BTS Group Holdings (BTS)’s extension line and new lines (Gold, Pink and Yellow).