The stock price is likely to fall. In contrast to the other stocks under our Healthcare coverage, BCH didn’t pitch a positive surprise for 2Q22. We suggest selling-on-fact, as its COVID-related windfall has already peaked and earnings will fall this year and next. We have a HOLD call with a YE22 DCF-derived target price of Bt22 (7.0% WACC and 2.0% terminal growth).
Earnings were in line with our estimate and consensus
BCH reported a net profit of Bt1.1bn for 2Q22, down by 0.2% YoY and 44% QoQ. Stripping out an FX loss and an allowance for bad debts of Bt100m, core earnings would be Bt1.2bn, up 8.6% YoY but down 39% QoQ. The result was in line with our estimate and the consensus. BCH announced a DPS for 1H22 of Bt0.40, a 1.9% simple yield (XD Aug 31, payment Sep 14).