2023-06-09 03:25:10
Reporters reported that today (June 9, 2023) the company’s stock price Advance Info Service Public Company Limited or ADVANCE As of 10:12 a.m., it was 218 baht, plus 1 baht or 0.46%, the highest at 218 baht, the lowest at 217 million baht with a trading value of 41.68 million baht.
The share price of ADVANC has increased for the fifth consecutive day since the share price closed at 210 baht on June 1, 2023, representing an increase of 8 baht or 3.80%.
Mr. Supachai Wattanawiteskul analyst, securities company Yuanta (Thailand) Co., Ltd. raised ADVANC’s 2023 normalized profit forecast and adjusted its fair value estimate at the end of 2023 to 240 baht/share from the original 235 baht, maintaining a “BUY” recommendation. ADVANC’s share price is currently trading on low EV/EBITDA. than the historical average in a three-player market environment and intense competition Reflecting that the market is already very concerned regarding regulatory risks.
However, the normal profit forecast for the year 2023 has been increased by 8% and for the year 2024 by 9%, which the projection for 2023 is likely to increase from 1) price competition. Especially in the mobile market that dropped faster than expected and 2) the deal of Triple T Broadband Public Company Limited or 3BB was delayed by one quarter, causing a negative impact on the short-term financial statements in 2023. decrease because the loss statement will be recognized only in the second half of the year 2023 from adjusting the assumption of loss recognition from 3BB from 9 months to only 6 months in 2023 and reducing the assumption of depreciation that can be controlled well from expiration of some assets Including reducing the assumption of selling and administrative expenses or SG&A that is better than expected.
However, an upward revision of the 2023-2024 projection might lead to increased regulatory pressures due to changes in government that might lead to changes in regulations. Causing the market to worry regarding the industry in the next phase, which are 1) the government will try to add new players in the industry, 2) the merger of 3BB and ADVANC may be delayed, and 3) post-merger controls of companies. Ru Corporation Public Company Limited or TRUE formerly and Total Access Communication Public Company Limited or DTAC that may be more intense. In particular, controlling the service provider’s average revenue per customer, or ARPU.
However, from the analysis of such concerns Considered that the chance of new players in the industry at the late-cycle condition was assessed as being low. because new players have to invest a lot both the frequency spectrum and the network Even if the government helps, it’s not easy either. This is because it takes many years for new players to become profitable. And it is unlikely that the government will support a lot with any one private sector. The new government will likely have to look for other investments that are more worth the time and money.
As for the merger with 3BB, it is currently under consideration by the Office of the Broadcasting Commission. television business And the National Telecommunications Commission (NBTC), with the NBTC recently having a resolution for the working group to do more focus groups, so it is estimated that the deal will be more challenging to pass under the new government. But the chances of passing are still high.
Because if the deal does not happen, ADVANC is negative in the long run, but ADVANC’s share price has already been exposed to such negative risks. Including post-merger controls that may be more intense. which is another important approach that has the opportunity to occur The main control is tracking package prices that may affect customers. This may cause the group’s price increase to occur more slowly than the market expects. Such factors will make ADVANC less attractive. It is the main risk that must be monitored. In the short term, the trend of competition in the 2nd quarter of 2023 is still gradually decreasing from the previous quarter.
side Refinitive Consensus from 20 brokers rated ADVANCE Expected total revenue in 2023 at 197,490 million baht, net profit of 29,777 million baht and a target price of 240.83 baht.
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