Stocks in Focus on March 19, 2021: SPRC and TOP

Kaohoon Online has selected stocks with a potentially high growth for investors to consider on March 19, 2021.

 

KGI Securities has given an “Outperform” rating on Star Petroleum Refining Public Company Limited (SPRC) with a target price at ฿10.90/share.

KGI revised up SPRC’s earnings estimate for 2021 by 9% to Bt4.1bn thanks to higher stock gains. The security company expected new large stock gains of Bt3.1bn this year, up 89% from the previous forecast after KGI adjusted up its assumptions on Dubai crude price from US$53/55/bbl to US$65/65/bbl for 2021/22.

However, KGI cut its earnings projection for 2022 by 9% to Bt4.3bn as the security company revised down SPRC’s base GRM 6% to US$5.6bbl next year. Meanwhile, KGI rolled its target price over to 2022 and upgraded it to Bt10.90, from Bt9.80, based on 6.0x EV/EBITDA to reflect core earnings growth (excluding stock gain/loss) of 168% next year.

 

KGI Securities has given an “Outperform” rating on Thai Oil Public Company Limited (TOP) with a target price of ฿74.00/share.

KGI upgraded its earnings forecast for 2021 by 17% to Bt10.0bn mainly due to better stock gains. The security company expected new big stock gains of Bt4.9bn this year, up 89% from the previous forecast after KGI adjusted up the assumptions on Dubai crude price from US$53/55/bbl to US$65/65/bbl for 2021/22.

However, KGI revised down its earnings estimate for 2022 by 7% to Bt10.9bn as the security company adjusted down TOP’s base GRM by 2% to US$4.8/bbl next year. Meanwhile, KGI rolled the target price over to 2022 and upgraded it to Bt74.00, from Bt68.00, based on 7.0x EV/EBITDA, to reflect core earnings growth (excluding stock gain/loss) of 87% next year.

 

KGI maintained a rating of Outperform on SPRC and TOP and kept them in the portfolio of Energy top picks for 2021 as the security company believed refinery-product spreads will increase gradually every quarter and some may reach their normal levels in 2H21.