We believe the recent share price underperformance has already priced in the expectations of 2Q22 core earnings soft patch. Looking further ahead, strong earnings growth outlook for 2022 should catalyze the share price going forward. Moreover, SCGP’s long-term prospects look favorable, buoyed by growing demand and substantial growth opportunities from global mega trends. Our BUY rating stands.
SCGP reported a 1Q22 net profit of Bt1,658m, down 22% both YoY and QoQ. Stripping out a Bt8m FX loss, core earnings would be Bt1,666m, down by 26% YoY but up 29% QoQ. The net profit was 19% above our estimate, due to better margin of Integrated Packaging Chain (IPC) than expected (5% below the consensus).