Equity Analysis /

Thailand (Bualuang): Media - TV operators to lead bottom-line growth

  • TV operators to lead growth in 1Q21

  • Leaders of the pack—BEC, MONO, and WORK

  • OOH and cinema bottom-lines to drop QoQ

Napon Jaisan
Napon Jaisan

Equity Research Analyst

Bualuang Securities
7 May 2021

We expect TV operators to report strong profit growth for 1Q21. The third COVID-19 outbreak will affect overall ad spend in 2Q21, but less severely than the initial 2020 outbreak. We like TV operators—the biggest beneficiaries of lockdowns. Also, it’s a good time to buy OOH and cinema on dips. Our top pick is BEC.

TV operators to lead growth in 1Q21

Total ad spend was Bt23.2bn in 1Q21, down by 4% YoY and 14% QoQ, according to Nielsen. All media sub-categories reported YoY ad spend drops—transit (down by 34% YoY and 29% QoQ), in-store (down by 21% YoY and 27% QoQ), cinema (down by 19% YoY and 25% QoQ), outdoor (down by 5% YoY and 13% QoQ) and TV (down by 4% YoY and 12% QoQ). Total OOH media (outdoor, in-store and transit media) was down by 19% YoY and 20% QoQ. The seven firms under coverage should post aggregate 1Q21 core earnings of Bt299m, a YoY turn-around but down 72% QoQ. We estimate the four TV operators’ aggregate 1Q21 core profit of Bt346m, a YoY turnaround (cost-cutting) but down QoQ (seasonality). The two OOH players should mark combined core earnings of Bt346m, down by 78% YoY and 80% QoQ.