XO Soars 6%, Analyst Recomm. “BUY” with TP of ฿15 on 25% Earnings Growth Forecast in 2021

The share price of Exotic Food Public Company Limited (XO) rose ฿0.80/share or 6.20% to ฿13.70/share as of 16:04 local time in Thailand, with a trading value of 295 million baht.

 

Mr. Jittiporn Jantarach, Managing Director of XO, said on the Opportunity Day that the company expected 2021 revenue to grow 10%, mainly from an existing customer group, while earnings are estimated to expand 20-25% with a gross profit margin as high as 40%. XO saw that Thai food is still being popular among foreigners and global demand for Thai food products remains high.

 

Globlex Securities has given a “BUY” recommendation on XO with a target price of ฿15.00/share, expecting the company to deliver a record high revenue in 1Q21 as XO has completed the payment for listing fee in order to expand the market to cover more European countries. However, gross profit margin is projected to remain flat at around 41-42% due to an increase in production capacity which led to Economies of scale.  

 

Also, XO’s 2021 earnings will be contributed by fixed raw material price until the end of this year. Moreover, container shortage is gradually showing an improvement.

 

Globlex expected 2021-2022 earnings of 344 million baht and 375 million baht, respectively, while full-year revenue will stand at 1.38 billion baht and 1.42 billion baht, respectively, driven by the ongoing Covid-19 pandemic in Europe.