BAM Advances 4% as Analysts Expect a Significant Profit Growth from High NPL-NPA Sales

The share price of Bangkok Commercial Asset Management Public Company Limited (BAM) rose ฿0.80/share or 3.74% to trade at ฿22.20/share as of 15:37 local time in Thailand on Wednesday with a trading value of 2,633 million baht.

 

Capital Nomura Securities (CNS) has given a “BUY” recommendation on BAM as high growth and laggard stock with a target price at ฿27.50/share. CNS had a positive view toward BAM’s 4Q20 to report a net profit at 807 million baht, a decrease of 32% YoY and an increase of 170% QoQ.

 

Asia Plus Securities (ASPS) gave a “BUY” recommendation on BAM with a target price of ฿26.00/share. ASPS expected BAM to book 1.1 billion baht of net profit in 4Q20, a decrease of 36% YoY and an increase of 257.6% QoQ due to an increase in sales of NPLs and NPAs.

In 2020, ASPS estimated BAM’s profit to increase 60.2% from the economic recovery, and expected a dividend yield at 4%.

 

Kasikorn Securities (KS) has given a “BUY” recommendation on BAM with a target price of ฿25.50/share. KS expected a 4Q20 net profit of Bt799mn (+168% QoQ, -52% YoY), supported by an increase in sales of NPLs and NPAs on a recovering economy.

The security company also expected BAM to report a 2020 net profit of Bt1.93bn, on higher-than-expected NPA sales. Based on BAM’s aggressive business plan for 2021, earnings should increase significantly.

In addition, KS expected BAM to sell medium to large-size assets in 1H21 that should spur growth in 2021. Valuation looks undemanding with the stock trading at an adjusted PBV of 0.5x.