Earnings Report /
Thailand

Kerry Express (Thailand): Shallower QoQ loss reported for 1Q22

  • Shallower QoQ loss

  • KEX reported 1Q22 red ink of Bt491m

  • Revenue increased 5% YoY, led by greater parcel volume

Kijapat Wongmetta
Kijapat Wongmetta

Equity Research Analyst

Bualuang Securities
18 May 2022

KEX is building market share from big competitors (squeezing them), making for significantly greater volume and a lower cost-per-parcel. And its balance sheet is a lot healthier (debt-free) than the balance sheets of most of its competitors. The price-war also makes it harder for competitors to raise new funding, due to the weaker outlook. Hence, if KEX were to emerge from the price war as the last man standing, there would be huge scope for upside. However, we expect the firm to continue reporting red ink for quarters ahead, until some of its competitors give up. Our HOLD rating stands.

Shallower QoQ loss

KEX reported 1Q22 red ink of Bt491m, a YoY reversal from earnings, but a shallower QoQ loss. The loss was 13% shallower than our estimate (15% deeper than the consensus), due to a shallower loss-per-parcel and lower parcel volume than assumed.