Analysts Expects JMT to Grow even Stronger in 2H, Giving a Target Price as High as Bt58

JMT sets its target of purchasing up to 10,000 million baht of bad debt in 2021, showing strong financial status with a D/E at 1x as analysts agreed on giving “BUY” recommendations with a target price as high as Bt58.00 per share.

 

In the analysts meeting, the management stated that in 1Q21, JMT had purchased 1,833 million baht of bad debt from the target collection of 6,000-10,000 million baht in 2021. The performance in 1Q21 was outstanding, considering financial institutions usually provide bad debt for collection in the second half of the year, especially near year’s end.

JMT also added that the company has an interest in Citi Group’s bad debt portfolio with enough funds to purchase the NPL. Meanwhile, the company stated that the news of JMT has the best chance of winning the debt auction with Citi Thailand across the media, newspapers, and analysts was untrue.

 

Trinity Securities has given a “BUY” recommendation on JMT with a target price at ฿52.00/share, expecting the company to record earnings in 2021 at 1,391 million baht, representing a 33% increase YoY.

A significant growth should be visible in 2H21 after fully amortizing the bad debt. More importantly, the debt purchasing at the end of 2020 should be starting to recognize more revenue in 2H21 as well.

Trinity Securities stated that JMT’s financial status has improved after the exercise of JMT-W2, resulting in a decrease in D/E from 1.48x to 1.07x, which allowed JMT to be able to purchase more bad debt.

 

Finansia Syrus Securities (FSS) also gave a “BUY” recommendation on JMT with a target price at ฿52.00/share as well, saying that the resurgence of Covid-19 has limited impact on JMT, which would result in higher earnings in 2Q21, compared to the previous quarter and the same quarter last year.

FSS added that JMT’s 2021 earnings will continue to increase from the growing portfolio, the fully amortization of debt debt and the benefit from purchasing a tremendous amount of NPL in the first quarter. FSS expected that JMT will book the highest earnings in 4Q21.

In addition, the decline in these past two weeks could be due to a profit taking after the share price has been on a rise since 2020. However, FSS expressed no concerns regarding JMT’s growth and earnings quality, while expecting the company to book 1,501 million baht of profit in 2021, representing an increase of 43.36% YoY.

 

Aside from Trinity Securities and Finansia Syrus Securities, Kasikorn Securities and KGI securities also had a similar view on JMT, giving “BUY” recommendations with target prices at ฿50.25/share and ฿58.00/share, respectively.