Equity Analysis /
Thailand

Central Pattana PCL: More than a reopening play

  • Expecting big shopping spree in 2H22

  • SF, new malls, hotels & residential to drive growth post-COVID era

  • Limited impact from a rising cost environment

Bualuang Securities
5 September 2022

We have raised our YE22 target price from Bt76 to Bt80, as our expectations have expanded for 2022-24 earnings and CPN’s five-year plans for its hotel and residential development businesses. The stock is not just a reopening play, but a high-quality mall operator that can sustain growth for years ahead.

Expecting big shopping spree in 2H22

Heavier mall traffic (driven by both local and foreign shoppers), a reduced rent discount, and CPN’s ability to control costs will generate YoY and QoQ earnings growth for both 3Q22 and 4Q22 (CPN’s best quarter of 2022). We have upgraded our 2022 profit forecast by 5% to factor in the strong 1H22 profit recovery, which we expect to continue through 2H22. Our channel check points to an ongoing recovery in traffic and a diminished mean rent discount in July (down by 1-2% from a 15% discount to headline rates in 2Q22). We also expect the hotel and real estate businesses to mark HoH revenue growth for 2H22, supported by the tourism recovery and seasonality.