Kasikornbank Public Company Limited (KBANK) reported a net profit of 10.6 billion baht in 1Q21, increased 44.10% from the same period of last year, as expected credit loss decreased 27% year-on-year and income from fees and service surged 7% year-on-year, while NPL stood at 3.93%.
With KBANK’s impressive 1Q21 results, Kaohoon Online has compiled analysis to help traders analyze potential investment in KBANK.
KGI Securities (KGI) stated that KBANK’s result was 45% above its forecast and 33% above the market consensus due to improvements on all fronts. The 1Q21 earnings accounted for 33% of KGI full-year forecast. As 1Q21 earnings were far better than KGI estimate, it revised up 2021/2022 earnings by 11%/8%, factoring in the NIM assumption being raised 15bps each year to 3.25% and raising gain on investment by Bt1bn in 2021. The earnings revision price resulted in slower earnings estimates in 2Q21 due to the third wave of COVID-19 infection. Applying PBV of 0.9x, KGI reached a new 2022 target price of ฿182.00/share, up from ฿172.00/share and maintained Outperform rating.
KTBST Securities (KTBST) reiterated a BUY rating on KBANK but raise a target price to ฿177.00/share from ฿160.00/share and 2021E PBV to 0.90x (-1.25SD below its 10-yr average) from 0.85x (-1.50SD). Also, upgrading 2021E earnings forecast to reflect KBANK’s stronger-than-expected 1Q21 results and bullish guidance. KBANK’s results beat Bloomberg consensus and KTBST forecast by 27% and 47% due to lower-than-expected loan-loss provision and higher fee-based income. NPL ratio remained unchanged at 3.93%, which was an upside surprise.
KTBST raised 2021E/22E net profit forecast by 10% to reflect the lower-than-expected loan-loss provision. In 2021E, KTBST forecasted net profit to grow +17% to 34.00 billion baht, while 2Q21E net profit is projected to grow significantly YoY on lower loan-loss provision.
Maybank Kim Eng (Maybank) maintained the 8-11% earnings growth forecasts for KBANK’s FY21-22E but saw upside risk from the lower-than-expected credit cost and higher fee income growth in 1Q21. Maintaining BUY and a target price of ฿160.00/share implies 0.8x FY21E P/BV and 9.1% ROE. Key risk is weaker-than-expected asset quality.