TU Jumps 3%, Analyst Recomm. “BUY” with TP of ฿20 ahead of Seafood Business Rebound

The share price of Thai Union Group Public Company Limited (TU) rose ฿0.50/share or 2.66% to ฿19.30/share as of 15:59 local time in Thailand, with a trading value of 599 million baht.

Asia Plus Securities (ASPS) has given a “BUY” rating with a target price of 20.00 baht, stating that Songkla Canning (TU’s subsidiary) reported that more than 400 of its workers were infected with COVID-19 and it is conducting test on more than 1,000 high-risk workers.  This would have limited impact on TU since it has many other factories in and outside Thailand that can offset its production and it has dealt with COVID-19 infection in its plants many times, so this should be manageable.

ASPS maintains its forecast, estimating 2021 net profit to grow 2% yoy as Red Lobster, shrimp, and salmon businesses would rebound. This issue would have limited short-term impact, so TU is still favorable for medium-and long-term investment.