Stocks in Focus on October 18, 2019: AOT and CPF

Stocks in Focus on October 18, 2019: AOT (Krungsri Securities TP ฿87.00/share) and CPF (Maybank Kim Eng TP ฿34.00/share).

Kaohoon Online has selected two stocks with a potential of high growth for investors to consider on October 18, 2019.


Krungsri Securities (KSS) – Airport of Thailand Public Company Limited (AOT) with a “BUY” recommendation and a target price at ฿87.00/share.

KSS has made an analysis after AOT announced submission deadline for Don Muang Airport duty-free concession is Dec 11. There will be 1 master contract that grants the winning bidder the right to operate the duty-free concession for 10 years and 6 months. Expecting up to 5 bidders, AOT will start selling the TOR documents from Oct 24 to Nov 8. The deadline for submission is Dec 11, presentations would be held on Dec 12-13, and the winning bidder would be announced Dec 16.

Despite the ban on CPN under the TOR, KSS still believes there will be intense competition with up to 5 bidders. This is similar to the numbers of bidders for Suvarnabhumi Airport duty-free concession in May.

KSS maintains that AOT will be a prime beneficiary of recovering tourist arrivals in Thailand. This will not only lift the company’s aeronautical revenue but also drive up competition for the concession in 4Q19-1Q20, which means higher concession revenue for AOT.


Maybank Kim Eng – Charoen Pokphand Foods Public Company Limited (CPF) with a “BUY” recommendation and target price at ฿34.00/share (+28%).

Maybank expects 3Q19 normalised earnings to decline QoQ and YoY, due to lower swine prices in Thailand and Vietnam, and overseas sales will be pressured by the strong THB. The 4Q19 earnings tend to be seasonally slower, forecasting 3Q19 net profit at THB4.7b (+15% QoQ, -4% YoY).

However, positive factors could stem from: 1) broiler prices remain higher YoY 2) Viet swine prices are recovering faster than expected.

Thus, Maybank maintains “BUY” recommendation, with SOTP-based TP of THB34: THB6.20 from CPF, pegged to 17x (PE +1SD to 3Y average) and THB27.80 from its stake in CPALL (THB82.25, BUY TP THB92) based on DCF 7.2% WACC, 4% LTG.

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