Equity Analysis /
Thailand

Plan B Media Pcl: External factors do not define your internal worth

  • External headwinds can’t topple PLANB’s growth

  • PLANB 2 “PLAN A”

  • OOH market too mature?

Napon Jaisan
Napon Jaisan

Equity Research Analyst

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Bualuang Securities
28 September 2022

While finding ways to survive the COVID era, PLANB also used the period to speedily expand its business. Unfortunately, decelerating ad growth due to recession risk implies downward pressure on the media industry. But PLANB has strong roots that can withstand any storm, so once the storm passes, wait for the rainbow. If the business environment returns to normal, PLANB’s performance will be better than its pre-COVID results, we predict.

External headwinds can’t topple PLANB’s growth

We expect PLANB’s utilization rate to rise from 35% in 3Q21 to 55% in 3Q22, due to a recovery in ad spending (but drop slightly from 57% in 2Q22, slowed by the macro headwinds). Brand owners haven’t cut their budgets but postponed their ad campaigns to 4Q22 instead. During 2020-21, ad budgets were spent mostly in the fourth quarter, as some budgets were postponed from the first nine months. We expect to see the same pattern in 2022. Therefore, we see its utilization rate rising to above 60% in 4Q22 vs. 54% in 4Q21. For engagement marketing, boxing will play a major role to support growth in 2H22, which is expected to contribute revenue of Bt200m (30% in 3Q22 and 70% in 4Q22). Overall, we expect PLANB’s net profit to rise by 250% YoY and 20% HoH in 2H22. 4Q22 should be its best quarter for this year.