KGI Securities (Thailand) Public Company Limited

Shares of Hana Microelectronics Public Company Limited, or HANA, rose 5.39%, trading at 53.75 baht in the afternoon, up 2.75 baht, after touching a high of 54.00 baht during the session, with turnover of 2.39658 billion baht. KGI Securities (Thailand) recommends buying with a target price of 63.00 baht at the end of 2027. It expects core profit in the third quarter of 2026 to recover to 305 million baht, improving both year on year and quarter on quarter, driven by better margins, a smaller loss at PMS after production was shifted to Chinese manufacturers, rising orders from Phononic, and a weaker baht. As a result, core profit for the first nine months of this year stands at 686 million baht, up 67% year on year, accounting for 70% of the research house's full-year profit estimate. KGI also expects core profit in the fourth quarter of 2026 to rise both year on year and quarter on quarter, with a continuously improving trend in 2027, when it forecasts growth of 44% on higher sales and gross margin. It sees earnings continuing to recover on the back of growing AI adoption, after HANA won orders related to cooling solutions, data transmission apps, and solid-state transformers.

KGI Securities has issued an analysis updating the latest capital increase and subscription price for the PROSPECT REIT fund, setting the final offering price at 9.00 baht per unit, reduced from the previous maximum ceiling of 10.50 baht per unit. The target asset is the Bangkok Free Trade Zone 4 project, or BFTZ 4, located in Bang Pakong district of Chachoengsao province. This capital increase aims to grow total portfolio value from about 10 billion baht to 15 billion baht and to raise net leasable area to 750,000 square meters, focusing on the logistics and warehouse market within the Eastern Economic Corridor. The sponsor, Prospect Development, has guaranteed a minimum rental income of 170 baht per square meter per month for two years for space that remains unleased as of the investment date. The historical distribution yield of PROSPECT REIT is around 8 to 11 percent per year, and there are plans to switch to monthly distributions. For the funds KGI recommends for September 2026, the research team continues to recommend top-tier funds CPNREIT, WHAIR and AMATAR, as well as second-tier picks ALLY, LHHOTEL and PROSPECT.

Shares of ALT Telecom, or ALT, rose 3.01% to 1.71 baht at 10:02 a.m. after the company signed a contract for a fiber optic network project along the Bangkok-EEC route linked to data centers, with a total value of approximately 2 billion baht, and it will begin recognizing revenue in the middle of next year. KGI Securities (Thailand) said in an analysis, giving a base target price of 3.0 baht, that it expects ALT to be one of the stocks benefiting from the unlocking of the PDP2026 plan and data centers this October. It also expects that the investment project to replace smart meters to support Thailand's energy transition will be an upside. Currently ALT holds a 40% stake in Energy Max, which operates a smart meter business, while the other 50% is held by PIS, a subsidiary of SKY, and it is expected that in the third quarter of 2026 there is a chance of recording an extraordinary profit from selling Energy Max shares to PIS. It estimates support at 1.65 baht and resistance at 1.71-1.75 baht; if this resistance range is broken, the next resistance is estimated at 1.80-1.90 baht, with a stop loss at 1.60 baht.

KGI Securities (Thailand) Public Company Limited, or KGI, has initiated coverage on Siam Cement Public Company Limited, or SCC, with a Buy rating and a 2027 sum-of-the-parts target price of 305 baht per share, based on blended EV/EBITDA and P/E. It views the current valuation as still below historical averages and those of its peer group. KGI said SCC is in a period of structural transition, having previously relied mainly on its petrochemical business. In 2021, core profit peaked at around 47 billion baht, with the chemicals business accounting for roughly 60%, before profit fell to about 5 billion baht in 2025 on weaker product spreads and operating costs from the LSP project. In the first half of 2026, the share of EBITDA from the chemicals business fell to about 36% from 45% in 2021, while SCG Packaging Public Company Limited, or SCGP, and the Cement-Building Materials business, or CBM, which includes SCG Decor Public Company Limited, or SCGD, together saw their share of EBITDA rise to 55% from 49%. KGI expects SCC's core profit in 2026-2028 to grow 287%, 7% and 27% from the previous year, respectively, with its 2027-2028 estimates about 14% and 10% above the market consensus, respectively. It estimates SCC's annual CAPEX will fall to about 30 billion baht from around 61 billion baht previously, which should accelerate debt reduction and increase dividend-paying capacity. It also estimates a bull case of 381 baht per share and a bear case of 117 baht per share.

AWC shares rose 5.09%, bucking the market, after the company approved the sale of 5 projects to AWR for a minimum value of 48.449 billion baht. The stock climbed as high as 3.30 baht, up 0.16 baht. KGI Securities (Thailand) set a base target price for AWC at 3.6 baht, expecting strong earnings in the third and fourth quarters. It also sees positive sentiment from China's long holiday period starting late this month through early October, which is expected to boost the number of Chinese tourists. AWC has a Chinese customer base of about 13%, and several large events in the fourth quarter will support Thailand's overall tourism picture. Meanwhile, the planned launch of the AWR REIT will help unlock asset value and prepare investment funds to continue expanding the hotel business. KGI assesses the share price as a sideways uptrend, with support at 3.08 baht and resistance at 3.18 to 3.22 baht. If it breaks through this resistance range, the next resistance is estimated at 3.4 baht, with a stop loss at 3.04 baht.

KGI Securities (Thailand) said after a meeting with THAI management that the business outlook for the second half of 2026 remains strong even as the airline enters the low season, with 3Q69 bookings growing from a year earlier, supported by a strong recovery on European routes and a cabin factor of 85%. For 4Q69, operating results are expected to grow well in line with the tourism season. On oil price hedging, in 2Q69 THAI raised its hedge ratio to 60% covering 24 months, from 50% covering 12 months, while in 2H69 the hedging ratio stands at 40%, split between Brent at 30% and jet fuel at 10%. As for the search for a new CEO, applications are open until September 27, 2026, and clarity is expected by the end of this year. The research team maintained its net profit forecast for THAI in 2026F at 19.5 billion baht, down 36.8% from a year earlier, mainly due to higher fuel costs stemming from the US-Iran war, while 2027F profit is expected to recover to 23.0 billion baht, up 17.7% year on year. It maintained its Buy recommendation with a 2027F target price of 7.00 baht, based on an EV/EBITDA of 6 times, or plus 1.5 standard deviations, after THAI was added to the FTSE Small Cap index effective September 21, 2026.

Technology component stocks led by KCE and HANA rose more than 2%. At 10:55 a.m., KCE stood at 67.25 baht, up 1.50 baht or 2.28%, with trading value of 764.19 million baht, while HANA stood at 49.50 baht, up 1.00 baht or 2.06%, with trading value of 677.56 million baht. This followed an analysis note from KGI Securities (Thailand) stating that KCE has an opportunity to expand into the printed circuit board, or PCB, business for humanoid robots, after KCE informed the Stock Exchange of Thailand on September 11, 2026, that it is in negotiations to buy and sell products with a company in the United States, which KGI believes could be Tesla, and the product could be PCBs for the Tesla Optimus robot. Tesla aims to scale up robot production from about 10,000 units initially to 1 million units per year, and eventually to 10 million units in the long term. KGI preliminarily estimates that revenue from this project could account for roughly 0.3% to 1.3% of KCE's total revenue, under the assumption of production of 1 million robots using PCBs worth 150 to 200 US dollars per unit and KCE holding an order share of about 1% to 3%. It has therefore not yet included revenue from this project in its forecasts. It also raised its core business profit forecasts for 2026-2027 by 6% to 25%, recommended "Hold" on KCE, and raised its end-2027 target price to 62 baht from 48 baht, based on a PER of 40 times. Meanwhile, HANA is expected to benefit indirectly from the upgrading of the AI server supply chain through three key businesses: thermal solutions for HBM and GPU through a partnership with Phononic, high-density PCBA testing equipment, and SiC solid-state transformers. KGI raised its profit forecasts for HANA by 6% to 11%, maintained its "Buy" recommendation, and raised its end-2027 target price to 63 baht from 45 baht, based on a PER of 40 times, expecting normal operating profit in 2027 to grow 44%.

Two brokerages have maintained their buy recommendations on BEM shares, with KGI Securities (Thailand) setting a sum-of-the-parts target price of 8.40 baht and Yuanta giving a fair value of 10.50 baht for the end of 2026. This follows the August 2026 report on Blue Line electric train passenger volumes, which averaged 444,000 people per day, up 1.0% year on year and 4.2% month on month, while ticket sales revenue came in at 13.2 million baht. Average daily vehicle volume on the expressway was 1.12 million vehicles, up 0.7% year on year and 1.4% month on month, generating revenue of 25.6 million baht. For the first eight months of 2026, average passenger volume was 424,500 people per day, up 0.8% year on year, and average vehicle volume was 1.1 million vehicles, up 0.8% year on year. KGI maintained its 2026 profit forecast at 3.9 billion baht, up 4% year on year, and its 2027 forecast at 4.0 billion baht, up 3% year on year, excluding any upside from the Orange Line. Yuanta maintained its 2026 normalized profit forecast at 3,973 million baht, up 5.1% year on year, and expects third-quarter 2026 profit to hit a new all-time high, driven by a dividend of 221 million baht received from TTW and the start of maintenance cost savings on the Purple Line. Meanwhile, the first of 32 trains for the entire Orange Line will be delivered to Thailand in November 2026, with the eastern section expected to begin commercial service by January 2028 and the western section by July 2030.

KGI Securities (Thailand) said in an analysis that Bangkok Expressway and Metro, or BEM, will post strong profit in the second half of the year. In August 2026, average electric train ridership was 444,000 passengers per day, up 1.0% from the same period last year and up 4.2% from the previous month, while average fare revenue was 13.2 million baht per day. In the expressway business, average traffic volume was 1.12 million vehicles per day, up 0.7% from a year earlier, with average revenue of 25.6 million baht per day. For the first eight months of 2026, average train ridership was 424,500 passengers per day, up 0.8%, and average expressway traffic was 1.10 million vehicles per day, up 0.8%. KGI expects third-quarter 2026 ridership and revenue to rise about 1-1.3% from the same period last year and 11-12% from the previous quarter. It maintained its 2026 net profit forecast at 3.9 billion baht, up 4% from a year earlier, and its 2027 forecast at 4.0 billion baht, up 3%. It also maintained its Buy recommendation with a sum-of-the-parts target price of 8.40 baht, comprising 6.30 baht for the core business, 0.75 baht for investments in TTW and CKP, and 1.35 baht for the Orange Line electric train project.

KGI Securities (Thailand) stated that the Cabinet has approved Bangkok Flight Services Ground Company, or AOTGA, as the winner of the bidding for the cargo warehouse, aircraft parking, and ground services project at Suvarnabhumi Airport under the PPP Net Cost model. AOTGA will become the third service provider. The project comprises two main contracts: cargo warehouse services, and aircraft parking, ground support equipment, and passenger services, with a concession period of 25 years and a total value exceeding 67 billion baht. AOTGA is a joint venture between AOT, holding 49%, and Bangkok Flight Services Ground Company, or SAL, holding 51%. SAL is a subsidiary of Sky ICT, or SKY. KGI Securities estimates that AOTGA will manage approximately 400,000 to 600,000 tons of cargo per year, generating revenue of about 4 to 6 billion baht annually, and expects AOT to recognize profit sharing of approximately 400 to 600 million baht per year, representing an opportunity to increase its FY2027 net profit forecast by about 1.5% to 2.2%. KGI Securities maintains a "Buy" recommendation with a FY2027 target price of 71 baht.

KGI Securities (Thailand) stated that CPAXT has launched "The Happitat" project on August 21, 2026, under the concept of "Happiness-Led Destination," with a total investment value of 15 billion baht. The project is divided into three main towers, with a total retail area of approximately 43,000 square meters and a total office area of approximately 24,000 square meters. It is expected to attract about 19 million visitors per year and is expected to recognize a loss of 500 million baht from this project this year. In the acquisition of ordinary shares of The Food Purveyor Sdn. Bhd. Group (TFP), the final price was MRR 1,597 million, or approximately 13.095 billion baht, with 80% of the funding coming from bank loans. The company expects TFP's sales to account for approximately 4% of its retail sales and to support profit growth from 2027 onwards. However, CPAXT's profit is expected to decline in the third and fourth quarters of this year due to the impact of government stimulus measures and business expansion costs. The company maintains its 2026 profit forecast at 8.8 billion baht and maintains a "Hold" recommendation with a year-end 2026F target price of 15.00 baht, based on a PER of 18.0 times.

CP Axtra, or CPAXT, announced the completion of its acquisition of The Food Purveyor, a premium supermarket operator in Malaysia, for 1,660 million Malaysian ringgit, or approximately 13,483 million baht. Its subsidiary, Lotuss Stores (Malaysia), acquired 100% of the shares on September 1, 2026, after fulfilling conditions and obtaining regulatory approvals. This makes The Food Purveyor an indirect subsidiary, operating under the brands Village Grocer, B.I.G., BSC Fine Foods, OTK, and The Food Merchant, with a total of 50 branches. KGI Securities expects TFP's profit to be around 38 million ringgit, or 300 million baht per year, based on a 31% market share in Malaysia's premium supermarket market, which is valued at 4.1 billion ringgit, and a net margin of 3%. Meanwhile, CPAXT may incur debt of 60-70% of the investment value and use some cash of around 4-5 billion baht, causing its debt-to-equity ratio to rise from 0.4 times to 0.42-0.43 times. The outlook is neutral due to limited synergies, and third-quarter profit is expected to decline due to government stimulus measures and business expansion costs. The recommendation is 'Hold' with a target price of 15 baht.