Equity Analysis /
Thailand

Gulf Energy Development PCL: Optimal mix of blue-chip and growth

  • Strong profit growth secured for several years ahead!

  • Upcoming PDP to open new investment opportunities

  • Data center and digital transformation trends

Bualuang Securities
6 January 2022

We expect positive messages at our upcoming Thai Corporate Day on Jan 7. Apart from an impressive core earnings outlook, GULF should reveal more details about its transformation from a Utilities giant into an integrated infrastructure leviathan. We expect its businesses to seize opportunities tied to the upcoming PDP2022, the e-commerce industry, and the digital shift.

Strong profit growth secured for several years ahead!

GULF’s core earnings will jump 67% YoY to Bt12.6bn for 2022 (equity earnings from INTUCH and profits from new capacity) and will continue expanding fast for years ahead (driven by the start-ups of new IPPs), according to our model. And there are only modest risks tied to COVID-19 and gas price volatility, so the firm looks set to be a secure blue-chip stock, but one that can boast of fast profit growth. We also see scope for upside to GULF’s earnings profile and target price from potential new investments tied to Thailand’s upcoming PDP and new digital infrastructure businesses.