BTS Group "Turnaround and re-rating potential, despite near-term earnings..."

Research evidence excerpt

BTS Group "Turnaround and re-rating potential, despite near-term earnings..."

5) NM (0.09)

BTS reported a FY26 core net loss of Bt783m, below our forecast of a Bt480m net loss,

03/28E 0.09 (0.02) NM (0.04)

affected by distortions from the full-year consolidation of subsidiary Rabbit Holdings and

03/29E 0.13 0.02 -82 (0.11)

ROCTEC's earnings into BTS's financials. While growth was driven by the real estate and

IT solution segment (MATCH), where revenue more than doubled YoY alongside margin Sukrit Friestad

expansion, Mass transit segment (MOVE) remained broadly stable and media (MIX) Analyst

declined YoY amid weaker advertising demand. At the operating level, profitability sukrit.friestad@ubs.com

improved with recurring EBITDA and gross margin expanding YoY, supported by a +662-613 5732

higher contribution from MATCH. However, below the line pressure led to a net loss,

reflecting impairment charges, higher finance costs and a structural reduction in interest

income following the BMA debt repayment, which also weighed on MOVE profitability.

Valuation: lower SOTP-based price target; reiterate Buy rating

Based on weaker than expected FY26 earnings, we cut FY27-29E EPS materially, with

FY27-28E to remain loss-making vs. our prior expectation of a turnaround. This reflects

three key changes: slower ridership ramp on the Pink and Yellow lines; lower MOVE

profitability; weaker advertising demand and an absence of street furniture revenue,

implying a 10-12% decline in MIX revenue; and higher expected interest costs amid rate

headwinds. These are reflected in our lower price target of Bt3.00 from Bt4.30 (see

Figure 2).

Highlights (Btm) 03/24 03/25 03/26 03/27E 03/28E 03/29E 03/30E 03/31E

Revenues 18,175 19,012 23,044 25,976 27,722 29,423 32,488 39,374