Equity Analysis /
Thailand

CP All: 3Q22 preview: 7-Eleven should mark a solid recovery

  • Expect a solid CVS biz recovery for 3Q22

  • Product price rises would have boosted margins

  • Profit recovery profile through 4Q22 and into 2023

Bualuang Securities
11 October 2022

We expect CPALL’s convenience store biz to mark a YoY traffic recovery for 3Q22. Furthermore, product price increases should outweigh the effect of higher costs, boosting its margins.

Expect a solid CVS biz recovery for 3Q22

Our model points to a 3Q22 core profit of Bt3,124m, up by 113% YoY and 2% QoQ. We assume SSSG of 20% for the quarter. Our revenue assumption is Bt201,136m, up 61% YoY but down 3% QoQ. Disregarding the makro and Lotus’s operations, we estimate a standalone CPALL core profit of Bt2,199m, up by 1009% YoY and 5% QoQ. Although heavy rains and flooding probably discouraged traffic QoQ, we still assume a strong YoY traffic recovery from the low 3Q21 base. Our 7-Eleven mean traffic assumption is more than 900 customers/store/day (versus 918 in 2Q22 and 900 in 3Q21). With delivery biz income included, we expect a mean ticket size of Bt84 (down 1% YoY, flat QoQ).