The share price of Gunkul Engineering Public Company Limited (GUNKUL) rose ฿0.10/share or 3.88% to ฿2.68/share in the morning session on Feb 25, with a trading value of 143 million baht.
KTBST Securities reiterated a “BUY” rating on GUNKUL with a SOTP-based target price of ฿3.25/share, stating the 4Q20 operating results of 567 million baht (+7%YoY, +188%QoQ) were above the market expected by 30%. KTBST maintained its 2021 core profit forecast at 2.3 billion baht (+60%YoY) in expectation of a full-year revenue recognition from existing power plant projects and EPC backlog.
GUNKUL’s share price has gained 7% in three months which is in line with the SET Index as the slowdown has bottomed out in 3Q20. KTBST believed GUNKUL should outperform the market with the key catalysts including 1) a potential to win a greenfield 200MW project, which should add 0.60 bath to KTBST target price, and 2) an attractive valuation. The stock currently trades at 2021E PER of 10x, which is well below 25x the sector’s average level, and PEG of 0.3x while forecasting EPS to grow +32% CAGR in 2020-22E.