Equity Analysis /

Thailand: Energy - 3Q22 preview—refining firms to post robust YoY growth

  • Aggregate 3Q22 core earnings to expand YoY, but slip QoQ

  • Further YoY aggregate core profit growth expected for 4Q22

  • Diminished 3Q22 expectations prompted earnings downgrade

Suppata Srisuk
Suppata Srisuk

Equity Research Analyst

Bualuang Securities
1 November 2022

The aggregate 3Q22 core earnings of our Energy coverage looks set to rise YoY, led by refining firms, BANPU, and PTTEP. Refining names are likely to post further core profit growth YoY and QoQ in 4Q22. PTTEP and TOP are our preferred picks.

Aggregate 3Q22 core earnings to expand YoY, but slip QoQ 

We expect the eight Energy names we cover to post an aggregate 3Q22 net profit of Bt58bn, up 29% YoY but down 52% QoQ, with core earnings of Bt103bn, up by 103% YoY but down 28% QoQ. Better operational performance would be the drivers of the YoY modeled aggregate net profit growth. Meanwhile, expected extra losses and weaker performance would be the key factors behind the QoQ bottom-line contraction. Among our Energy coverage, we expect most firms to post hefty YoY core earnings expansion, driven mainly by fatter margins. Refining firms look set to deliver the strongest YoY core profit growth (fatter GRMs), followed by BANPU (higher earnings from the coal and gas bizes) and PTTEP (greater petroleum sales volume and higher ASP).