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LPN Development PCL: 1Q21 result in line with our estimate (but missed the street)

  • In line with our estimate, but short of the consensus
  • LPN reported a 1Q21 core profit of Bt123m
  • 1Q21 core profit represents 15% of our full-year forecast and 16% of the consensus

Our BUY rating stands to a YE21 target price of Bt5.50 (pegged to a PER of 9.9x, LPN’s long-term mean). We like LPN for its cheap valuation (a 32% discount to BV of Bt7.7 at end-March 2021, despite no recap risk) and an attractive dividend (9.6% assumed for 2021). A short-term catalyst would be strong take-up rates for projects slated to launch in June—we expect bookings of 50% for Lumpini Ville Charan Fai Chai (Bt960m; a cheap sales price of Bt60k/sq.m) and 20-30% of BAAN 365 Muangthong (Bt800-900m for phase-1 of a planned Bt2.6bn). That would mean a QoQ presales recovery for 2Q21 and a rising backlog in 2022 (the proportion of our 2022 revenue assumption to be secured by presales may rise from 29% to nearly 40%).

In line with our estimate, but short of the consensus

LPN reported a 1Q21 core profit of Bt123m, down by 43% YoY and 49% QoQ. The result was in line with our estimate of Bt116m, but was 33% below the street (which had assumed greater revenue).


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