Equity Analysis /
Thailand

Ditto Thailand: Party’s not over, just taking a break

  • Record high 1Q22 core earnings expected …

  • …with clear revenue visibility and scope for upside …

  • …but DITTO’s valuation is stretched

Napon Jaisan
Napon Jaisan

Equity Research Analyst

Bualuang Securities
24 March 2022

Last year, DITTO was one of our favorite tech plays. It’s still one of our best stocks, due to its long-term growth potential. But it became overpriced—it shot up from Bt15 in Nov 2021 to Bt58 now—too fast and furious! The current price implies a 2022 PER of 111x and PEG of 2.6x. Although there’s scope for upside to our profit forecasts, it’s too soon to factor such possible upside into our model, we believe. Our call shifts down from BUY to HOLD.

Record high 1Q22 core earnings expected …

During 2021, DITTO signed many projects. It started marking revenue from the new contracts in 3Q21. DITTO signed two big projects during 2Q21—a Hybrid Cyber Security Operations Center for KTB Computer Services (Bt351m) and a planetarium in Phitsanulok Province (Bt163m). In 1Q22-to-date, two big projects have been sealed—Phuket Marine Life (Bt369m) and Natural World Heritage Learnings Center in Ranong province (Bt375m). Moreover, recurring revenue should rise further in 1Q22, due to the snowballing effect of the data & document manage-ment biz (DMS). Hence, we expect 1Q22 core earnings of Bt60m, up by 46% YoY and 86% QoQ and a new record high.