EGCO’s current stock price implies the cheapest PERs for 2021-22 among our Utilities coverage, while its core earnings growth profile is not bad. The company will purchase a 17.4% share in Apex Clean Energy Holdings LLC (a renewable power developer in the US), which may precipitate it entering the American renewables market in earnest. That could mean scope for upside to our long-term earnings forecasts and target price. If the firm were to announce a new profitable investment, we would expect its stock to rally.
Core earnings were in line with our estimate
EGCO reported a 3Q21 net profit of Bt1,074m, down by 53% YoY and 29% QoQ. The bottom-line beat our estimate massively, due to lighter extra losses (on FX and financial instruments) than assumed. Stripping out extra items, core earnings would be Bt3,270m, up by 15% YoY and 11% QoQ. The core number was in line with our projection.