Equity Analysis /

Thailand: Discretionary Retailers - Time to reload shopping bags

  • Reopening and normalization to drive 2022-24 profit growth

  • Only limited downside risk tied to cost-push inflation

  • Bricks&mortar retail will continue to dominate

Bualuang Securities
3 May 2022

We have re-initiated coverage on CPN with a BUY call to a YE22 target price of Bt74, HMPRO with a BUY call to YE22 target price of Bt17.50, and CRC with a HOLD rating (target price Bt44). We believe CPN, CRC, and HMPRO will benefit substantially from Thailand’s reopening. CPN is our top pick in anticipation of a strong and sustained earnings recovery, its scope for building market share in the post-COVID era, and an attractive valuation.

Reopening and normalization to drive 2022-24 profit growth

Thailand is reopening and inbound tourists are returning, so we expect the discretionary retailers under our coverage—CPN, HMPRO, and CRC—to see solid revenue and profit growth, 2022-24. Our models point to aggregate 2022-24 revenue and core profit CAGRs of 10% and 40%, respectively. Among retailers, we expect CRC to post the strongest 2022-24 profit CAGR of 250%, followed by CPN at 38% and HMPRO at 12%.