Maybank Kim Eng Securities (MBKET) has given a “BUY” recommendation on Ichitan Group Public Company Limited (ICHI) with a target price at ฿16.60/share, expecting sales to grow despite the Covid-19 outbreak.
MBKET estimated ICHI to reported 2Q21 earnings at 155 million baht, representing an increase of 7% YoY and 29% QoQ as sales revenue would continue to grow amid Covid-19 outbreak due to the initiation of new products and through Soho. The company will recognize revenue from OEM production for the first time in 2Q. Meanwhile, overseas markets are recovering faster than domestic market as well.
In addition, the new hemp-infused product could be ICHI’s new S-curve later this year. MBKET saw the recent decline in share price is the opportunity to accumulate, believing that the Covid-19 outbreak has limited impact on ICHI, while expecting the business to recover faster than its peers.