The share price of Dynasty Ceramic Public Company Limited (DCC) rose ฿0.20/share or 6.58% to ฿3.24/share as of 12:05 local time in Thailand, with a trading value of 486 million baht.
Maybank Kim Eng (Maybank) said since DCC’s 1Q21 earnings hit a new record of 493 million baht (+36% QoQ, +34% YoY), beating previous expectation of 460 million baht, Maybank maintains BUY recommendation on DCC for investment and raised a target price to ฿3.50/share, on the 10-year average of Dividend Yield -1SD = 5%, up from ฿3.18/share due to adjusted forecast.
Maybank revised up DCC’s 2021 earnings forecast, estimating 2021 sales of 9.019 billion baht, (+6%) and profit of 1.68 billion baht, (+6%), setting a new record high. DCC has released new products, large sized with beautiful patterns and high margin to substitute imported ones, such as 60×120 cm and 80×80 cm floor tiles. They received a strong response, especially those imported from China that faced shipping trouble.
Despite higher gas costs, new product launch and price hike will enable gross margins to maintain around 42%. For construction material centers, rental space covered 80,000 sq m in 2020 with rental income of about 60 million baht, expecting to increase to 85-100 million baht in 2021.