Equity Analysis /
Thailand

Thailand: Hotel - Ready for upcoming high season

  • Room rates beat pre-COVID era levels; occupancy still to catch up

  • Tourism and MICE are twin 4Q22 drivers

  • QSR operations should rebound from low 3Q21 bases

Bualuang Securities
27 October 2022

3Q22 hotel RevPar numbers should be posted at about 75% of pre-COVID era levels, a big jump from the 50% recovery marked for 2Q22. The drivers are hotels in Thailand and Europe and QSR businesses. Our top pick is AWC, followed by ERW, CENTEL, and MINT.

Room rates beat pre-COVID era levels; occupancy still to catch up

We estimate our Hotel coverage aggregate 3Q22 profit at Bt1.96bn, a turnaround from a loss of Bt4.83bn for 2Q21 and up sharply from earnings of Bt699m for 2Q22. The expected bigger profit is due to shallower losses at AWC and ERW and higher earnings at CENTEL and MINT. Foreign arrivals exceeded 3.5m persons and more events/ functions were held during 3Q22, boosting occupancy and enabling hotels to raise room rates. The most popular tourist destinations were Bangkok, Hua Hin, and Koh Samui. The occupancy rates of the hotels in Thailand under coverage ranged 50-55% in 3Q22 (versus 75% in 3Q19, 13% in 3Q21 and 45% in 2Q22). Room rates already match pre-COVID era levels.