We believe ERW’s bottom-line bottomed out in 2021 and expect a swift recovery through 2H22. We like the HOP INN operation for its turnaround and successful eight-year expansion story. Our rating is BUY to a YE22 DCF-derived target price of Bt4.50.
Loss was deeper than our estimate (but in line with the street)
ERW reported a 1Q22 loss of Bt313m (against losses of Bt492m for 1Q21 and Bt246m for 4Q21). The red ink was deeper than we had expected (but was in line with the consensus projection), due largely to lower revenue than assumed.