Analysts Recommend “BUY” on ICHI, Expecting High Profit Growth in 1Q21 from New Products

The share price of Ichitan Group Public Company Limited (ICHI) rose ฿0.10/share or 0.70% to close the morning session on April 21, 2021, at ฿14.40/share with a trading value of 556 million baht. The highest share price in the morning session was ฿14.80/share and the lowest was ฿14.30/share.

 

Maybank Kim Eng has given a “BUY” recommendation on ICHI with a target price at Bt16.60 per share, stating that the company is entering the growth phase in the next few years. The security company expected 2021-22 net profit to grow 31% and 24%, respectively. The increase is due to revenue recognition from new products, an increased OEM orders and a strategy to penetrate grocery stores to expand sales channels. Moreover, the new products will have higher GPM and economies of scale.

 

Finansia Syrus Securities (FSS) has also given a “BUY” recommendation on ICHI with a target price at Bt15.00 per share, emphasizing profit boost from new products, especially Thailand’s first terpene-flavor green tea that is expected to be displayed exclusively in 7 Eleven for the first 4 months.

1Q21 earnings were expected to increase 46.4% QoQ from higher production before 2Q, which is a peak season due to it being summer in Thailand. Meanwhile, FSS expected higher demand for vitamin water amid the new Covid-19 outbreak. The security company maintained 2021 earnings estimate at +44.1%.