In the short run, the 1Q22 profit beat is likely to trigger a stock price rise. Over the longer view, we expect QH to move sideways-up in the Bt2.20-2.40 range, supported by the value of its investments—HMPRO (QH holds 20%), LHFG (14% stake), QHPF (26% stake), and QHHR (31% stake). Our HOLD rating stands with an SOTP-derived target price of Bt2.50, pegged to investment value of Bt2.2/share (a 15% discount to market value) and a targeted residential PER of 9.0x.
Profit beat our expectation and the consensus
QH posted a 1Q22 net profit of Bt585m, up by 36% YoY and 18% QoQ. The core result, which was also Bt585m, was 20% above our estimate (a fatter GM and a lower SG&A/revenue than we had assumed) and 12% ahead of the consensus.