Global Green Chemicals PCL: 1Q21 earnings miss; better 2Q21 profit already priced in

  • Below estimate
  • GGC posted a 1Q21 net profit of Bt94m
  • GGC’s 2Q21 core earnings should rise YoY and QoQ

GGC’s recent share price rally—it currently trades at a 2021 PBV of 1.2x, its historical mean—has already priced in expectations of a core profit improvement for 2Q21, we believe. Moreover, the downsized 2021 earnings outlook is uninspiring. We think it’s time to lock in profits. Hence, our call shifts down from BUY to HOLD.

GGC posted a 1Q21 net profit of Bt94m, down by 61% YoY and 83% QoQ. Stripping out extra items, core earnings would be Bt33m, down by 75% YoY and 62% QoQ. The result was 23% below our projection, due to a deeper loss at the FA biz than expected (but was in line with the consensus).

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