ANAN - Transfer delay is a buying opportunity (TP Bt6.7, OUTPERFORM)
(12/01/2018 - 09:00)
กลุ่มอุตสาหกรรม อสังหาริมทรัพย์และก่อสร้าง
หุ้น ANAN
มูลค่าพื้นฐาน 6.70
  • Buy on share price weakness to capture 69% yoy earnings growth in FY18F to Bt2.2bn
  • FY17F presales to come in at Bt35bn (+39% yoy), 8% above our and management’s targets; should remain healthy in FY18F
  • OUTPERFORM, Bt6.7 TP is based on 10x FY18F PE (historical average)


Share price correction due to delayed transfers presents buying opportunity

ANAN’s share price has fallen c.8% in one week due to delays in transfer of Ashton Asoke (JV, Bt6.7bn, 98% sold) and Venio Sukhumvit 10 (Bt860m, 90% sold) from 4Q17 to 1Q18. This prompted us to cut FY17F earnings by 29% to Bt1.3bn (-12% yoy), so we now expect 4Q17F profit to come in at Bt751m, up 433% qoq but down 16% yoy. However, this does not affect our FY18F earnings which we forecast at Bt2.2bn (+69% yoy), and its condominium transfer schedule for this year is more diversified than in FY17. This should reduce transfer delay risk in FY18. We recommend to buy on weakness to capture strong earnings growth in FY18F.


FY17F presales beat target, expect momentum to remain strong this year

Despite near-term negative earnings momentum in 4Q17F, there is positive news on presales. We estimate ANAN to achieve Bt35bn presales in FY17F (+39% yoy), 8% above our and management’s targets, thanks to good take-up for new launches. This should improve long-term revenue visibility and help to offset the negative sentiment triggered by the delayed transfers. For FY18F, presales should remain healthy at Bt41bn (+17% yoy), supported by 15% growth in value of launches. It has secured land for 40% of launches. Our FY18F presales are in line with management’s target.


Maintain OUTPERFORM, TP Bt6.7; top pick in the sector

We continue to like ANAN as (i) presales outlook remains strong, (ii) valuation is undemanding. Current share price implies 8.0x FY18F PE, which is below its historical average of 10x, and (iii) it should deliver strong earnings growth in FY18F. ANAN remains our top pick in the sector.