辉立证券-lack luster outlook for property business,land expropriation risk-20170616-phillip securities

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1、Editor:VaughnLITel:(852)22776628Email:foreignstock@phillip.com.hk16June2017UpdateQualityHousesSell(Maintain)/TP’17:2.40(-0.99%)ClosingPrice(Bt)2.54COMPANYDATALacklusteroutlookforpropertybusiness,landexpropriationriskO/SShares(mn):10,714MarketCap.(Btmn):27,215Landexpropriationri

2、sk:The96raioflandownedbyQHworthBt725mnwillbeMarketCap.(USDmn):80152‐WKHi/Lo(Bt):2.88/2.24expropriatedunderBMA’splantobuild‘monkeycheek’waterretentionprojectaspartof3MAverageDailyT/O(mn):23.22thegovernment’seffortstocopewithfuturefloods.Inthelatestdevelopment,QHhasParValue(Bt):1.

3、00filedaletterwithBMA,objectingtoitslandexpropriationplan.ItisalsoexpectedtohearMAJORSHAREHOLDERS(%)27April2017BMA’sdecisionontheissueinJul.Inourview,landexpropriationcouldposeadownside1.LH25.0riskforQHascompensationtendstobelowerthantheactualmarketprice.2.GICPRIVATELIMITED10.83

4、.ThaiNVDR5.6Presalesstuckinslowlane:QHachieved1QFY17totalpresalesofBt3bn,accountingforaPRICEVSSETINDEXmere17%ofitsfull‐yeartargetofBt18bn.Eventhoughthelatestdatashoweditstotal5presalesin2M2QFY17startedtoperkupfrom1QFY17onthebackofadditionalcontribution4fromthenewlylaunchedSDH/T

5、Hprojects,they‐ycomparisonhoweverremainedbelow3thoseof2QFY16whentheindustrybenefitedfromthegovernment’spropertystimulus21measures.Onthehigh‐risefront,YTDcondopresalesalsoremainedstagnateinthe0absenceofnewprojectlaunches.Forthisreason,westicktoourcallthatthereisariskofJun‐14Jun‐1

6、5Jun‐16Jun‐17adownsidesurpriseinfull‐yeartotalpresales.QHTBEQUITYSETI(rebased)Source:Bloomberg,PSRFY17coreprofitseenboostedbybetterprofitfromassociates:ForthewholeofFY17,weforecastQHtoseea13%y‐ydipinrevenuetoBt15bn.TheforecastisbasedonKEYFINANCIALSassumptionsthat(i)QHcurrentlyh

7、asabacklogofaroundBt3bntobebookedasrevenueFYEDecFY15FY16FY17EFY18ESales(Btmn)20,52319,28217,14018,699inFY17,(ii)sluggishSDH/THpresalesin1HFY17willdragfull‐yearSDH/THpresalesdownNetProfit(Btmn)3,1063,0853,0893,4288%y‐ytoBt12.8bn,and(iii)condorevenuefortheyearwillcomeinatBt3.2bn.M

8、arginsEPS(Bt)0.290.290.290.32tendtoholdsteady.P