Analyst Forecasts RS’s 2020 Earnings to Grow 51% with a Dividend Payment of ฿0.40/Share

RS is expected to book a profit of 124 million baht in 4Q20, an increase of 89%, as revenue from commerce business has grown 45%, while 2020 earnings are estimated to increase 51% to 548 million baht, with a dividend payment of ฿0.40/share. For the 2021 performance, analyst forecasts RS to book a net profit of 844 million baht, an increase of 54%, thus recommending “BUY” at a target price of ฿23.90/share.   

 

Capital Nomura Securities (CNS) forecasts RS Public Company Limited (RS)’s net profit in 4Q20 to grow 89% YoY to 124 million baht as revenue from commerce business would increase 45% YoY to 673 million baht and the total revenue for the quarter would rise 5% YoY to 936 million baht, driven by dietary supplement products, Predictive Dialing System (PDS) that help telesales staff can contact more customers, and a revenue from sales of program rights worth 40 million baht, as well as an improving gross profit margin by 5% YoY to 47% supported by a high gross profit margin of commerce business at the level of 60-70%.

 

For the 2020 outlook, CNS expects RS’s net profit in 2020 to grow 51% to 548 million baht underpinned by a 19% growth in commerce business to 2,403 million baht and revenue of more than 180 million baht from sales of program rights. CNS also projects RS to offer a dividend payment at ฿0.40/share.

 

CNS has revised up 2021 net profit forecast of RS to grow by 54% YoY to 844 million baht as commerce business remains solid from database management and the use of technology that have helped in customer analysis and insights, as well as helped telesales staff to contact more customers. CNS raised the revenue from commerce business to 3,200 million baht, an increase of 33% YoY.

 

CBS reiterates a BUY rating on RS with an upgraded target price of ฿23.90/share in line with the 2021 earnings revision, but has yet to include the upside risk from merger and acquisition (M&A) that expected to complete the transaction within January 2021.