Earnings Report /

Krungthai Card PCL: Result miss; slight NIM squeeze

  • Net profit was 7% below our model

  • KTC posted a 4Q20 bottom-line of Bt1.32bn

  • Gross loans were up 4.3% YoY at YE20

Bualuang Securities
20 January 2021

KTC’s share price has shot up to 43% above our YE21 target price, pushing its 2021 PER up to 30x (2.5SDs above its long-term mean). We don’t see any justification for such a high valuation, so have shifted down our call from BUY to SELL—time to lock in profits before the market becomes cognizant of its hubris over the stock. 

Net profit was 7% below our model  

KTC posted a 4Q20 bottom-line of Bt1.32bn, flat YoY and up 8% QoQ. The result was 7% below our projection (albeit 7% above the Bloomberg consensus), due to a slightly slimmer NIM than assumed. KTC marked a 4Q20 NIM of 21.3%; we had assumed 21.5%. Pre-provision operating profit was Bt2.3bn, down by 11% YoY and 6% QoQ. 2020 earnings dipped 3% YoY to Bt5.3bn, which represents 98% of our 2020 estimate of Bt5.5bn.