Equity Analysis /
Thailand

Thailand: System Integrators - A new journey in 2023

  • 4Q22 set to be earnings peak of the year

  • Cautious over AIT’s and ITEL’s 2023 outlooks

  • All new MFEC

Napon Jaisan
Napon Jaisan

Equity Research Analyst

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Bualuang Securities
13 December 2022

4Q22 will be the strongest quarter of 2022. MFEC is our top pick, as it will mark both YoY and QoQ growth for 4Q22 and won’t face any stock dilution. For 2023, our top pick is also MFEC, as it will transition from made-to-order projects to recurring managed services.

4Q22 set to be earnings peak of the year

For MFEC, we expect a Bt109m core profit for 4Q22, up by 12% YoY and 107% QoQ. Projects tend to start in the fourth-quarter. Our AIT model points to an 8% YoY core earnings decline (a high 4Q21 base, due to a fat GM of 26%) but QoQ growth of 39% (greater revenue recognition from new fat-margin projects that started in 3Q22).