Earnings Report /
Thailand

Home Product Center PCL: 1Q21 recovery visible, stronger 2Q21outlook

  • Slightly beat our forecast, in line with the consensus

  • HMPRO reported a core profit of Bt1.36bn for 1Q21

  • We expect 2Q21 core earnings growth YoY and QoQ

Bualuang Securities
28 April 2021

HMPRO has seen earnings recovery on YoY growth in 1Q21 after falling YoY for four straight quarters (1Q20-4Q20). Share price should rebound given YTD share price flattish against strong core profit recovery in 2021. Valuations are not expensive, as share price trades at a 2021 PER of 30.8x, near its mean in 2012-2020. We prefer HMPRO on leadership in ESG (endorsed by Dow Jones Sustainability indices in 2017-2020, FTSE4Good in 2016-2020, ‘AA’ MSCI ESG rating, and Bloomberg Gender Equality Index). We maintain BUY rating at a YE21 DCF-derived target price of Bt17 (6.3% WACC, 2.0% terminal growth).

Slightly beat our forecast, in line with the consensus 

HMPRO reported a core profit of Bt1.36bn for 1Q21, up 8% YoY but down 12% QoQ. The result was in line with the street number but 6% above our forecast due to better-than-expected sales GM.