Equity Analysis /

PTT PCL: Long-term growth assured

  • Gas business earnings to soften in 2H22

  • Key investment projects progressing as planned

  • Future Energy & Beyond businesses…sustaining long-term growth

Suppata Srisuk
Suppata Srisuk

Equity Research Analyst

Bualuang Securities
18 August 2022

Despite the expectations of profit softness in 2H22, PTT’s earnings will still expand strongly this year. Also, potential new investments would add to long-term earnings growth. The current valuation is undemanding—a YE22 PBV of 1.0x (1.1SD below its long-term mean of 1.6x) with an attractive dividend yield for 2022 of 6.1% (against 2.9% for the SET).

Gas business earnings to soften in 2H22

PTT’s gas business earnings look set to soften HoH in 2H22, squeezed by lower sales volume and slimmer margins. The gas sales volume will tend to decline HoH in 2H22, due to lower gas production from the Gulf of Thailand (reduced output from the Erawan project) and lower gas sales to the power plants (the power plants are likely to use more diesel/fuel oil as fuel burn in substitution for LNG which has seen its price skyrocket and is now more expensive than oil).