ASPS Expects TIDLOR’s 2021 Earnings to Grow 25.5%, Recom. “Buy on Weakness” at Bt44

Asia Plus Securities (ASPS) has given a “Buy on Weakness” recommendation on Ngern Tid Lor Public Company Limited (TIDLOR) with a target price at ฿44.00/share.

 

ASPS expected to see a solid growth in TIDLOR business in 2021 from the growing loan and insurance business, following the recovery in Thai economy. The company expected to recognize revenue from its previously high provision, while taking a step further on the insurance business due to its high GPM.

TIDLOR projected loan loss reserve/total loans at 4% in a long term, compared to 4.9% in 1Q21, resulting in a recognition from its previous provision at approx. 500 million baht in a long term.

 

ASPS estimated 2021 earnings to grow 25.5% YoY from the growing loan business by 16.2%. Moreover, 2Q21 earnings would continue to be in a positive outlook from lower interest cost as the company would utilize the IPO funding for a repayment. However, expenses were expected to increase due to WFH measures as the company required to purchase more IT accessories for its employees.

 

Nevertheless, ASPS asserted that TIDLOR has limited upside on its target price, based on 4.7x PBV from GGM of a long-term average ROE at 20.0%. ASPS recommended “BUY on Weakness” with a target price at ฿44.00/share.