Stocks in Focus on 31 July 2019: AMATA and RATCH

On July 31, 2019, Kaohoon Online has selected two stocks with a potential of high growth for investors to consider.

Finansia Syrus Securities stated that a sale and land transfer of AMATA Corporation Public Company Limited (AMATA) has been brighter in the 2Q2019. The result of moving base productions of Chinese investors has made a sale of land to increase higher approximately 166 rai, increasing 30% QoQ, 26% YoY. The land transfer has increased to 154 rai or 92% QoQ.
Finansia expected a normal profit to rise 28%QoQ, 89% YoY to THB 335 million from a sale of land. Finansia also believed that revenue of electricity sale, a fixed rent, and good cost and expenses controlling has substituted baht appreciation and a profit loss of AMATAV which resulting from no transaction of the land. Therefore, Finansia recommended “BUY” AMATA share with the target price of ฿28.00/share.

KTB Securities (KTBST) recommended “BUY” Ratch Group Public Company Limited (RATCH) share with the target price of ฿72.00/share. RATCH has purchased wind power plant which made an upside of ฿3.00/ share. Moreover, there is an upside from investing 70% in 214 MW of wind farm in Australia in a total amount of AUD 53.3 million.
The revenue recognition of this project is expected to be in September 2020. Additionally, KTBST expected the project to have 12% of EIRR which RATCH will recognize a profit of THB 500 million per year or THB 3.00 per share of RATCH, however, the current share price has not priced in yet.
KTBST recommended RATCH for three reasons. Firstly, there is an upside in RATCH’s share price from a profit growth that could hit an all-time high this year. Secondly, RATCH has acquired 700MW of Independent Power Producer (IPP) and recently, 150MW of a wind farm in Australia. Thirdly, KTBST expected a 2Q/2019 profit growth to be better in both YoY and QoQ from the commencement of 34.7MW Berkprai Cogeneration SPP.