BANKINGSECTOR：SLOWINGEARNINGSMOMENTUMIN3Q12F1011

1、sep-11nov-11 dec-11 apr-12oct-11 aug-12 may-12 sep-12jan-12jun-12feb-12 mar-12 jul-12 15 10 5 0 -10 -5 -15 -20 -25 thailand sector update overweight (unchanged) banking sector 11 october 2012 sector index : set index : 508.82 1,292.48 slowing earnings momentum in 3q12f overweight maintained. we esti

2、mate 3q12 earnings for thai banks to be flat from the prior quarter, but still grow well yoy. tisco, scb and bay should post strong 3q12f earnings. we expect net profit for the woraphon wiroonsri, cfa http:/www.maybank-ke.co.th (02) 658-6300 sector will grow 30% this year and a further 23% in 2013f.

3、 we maintain our overweight rating for thai banks with tcap, tisco and scb as our medium-term picks, while ktb is our long-term favourite. earnings momentum slowing in 3q12f. we project that the nine banks under our coverage will report an aggregate 3q12f net profit of bay bbl kbank kk ktb scb tcap

4、tisco tmb rating buy buy hold buy buy buy buy buy sell target price 38.0 232.0 200.0 53.0 25.0 190.0 46.0 54.0 1.64 upside 20.6% 20.5% 11.1% 11.0% 34.4% 14.8% 11.5% 10.8% -8.9% thb44.6b, up 1% qoq and 24% yoy. earnings growth momentum will slow in this quarter compared with 1h12. tisco, scb and bay

5、are expected to show outstanding growth both on a qoq and yoy basis, while growth at bbl is likely to be lacklustre. the sme and retail segments will be the key drivers of anticipated loan growth of 3.1% qoq (+9.6% ytd), while nims will be maintained at 3.11% on flat funding costs. fee income growth

6、 is forecast at 4% qoq with the vayupak dividends (for ktb, scb, tcap and bay) driving non-nii. the cost-to- income ratio is expected to fall a slight 0.7ppt to 45%, with ppop growth estimated at 5% qoq and 11% yoy. we do expect to see increases in historical chart 25 20 credit costs on ktbs extra p

7、rovision and tcaps turning back to normalized level after extra low in 2q12. there are still no concerns on npls. likely earnings decline in 4q12f, but solid full-year growth. overall, we expect 9m12f thai bank earnings to hit 77% of our full year forecast. however, we think 4q12f earnings could con

8、tract, on a seasonal increase in opex and extra provisioning at ktb. we maintain our net profit growth forecast of 30% this year and 23% in 2013f. key drivers will be healthy loan growth next year with 1) continuing momentum in performance 52-week high/low index bank set 519.49 / 328.48 retail loans

9、, 2) accelerated public investment and 3) private investment for business expansion at the upcoming aec. fee income will grow well, while the nims are expected to gradually improve as pricing power returns to commercial banks. the cut in the corporate tax rate from 23% to 20% will be another key ear

10、nings growth driver. absolute (%) relative (%) 1-mth 4.5 0.8 3-mth 8.7 1.3 1-yrs 40.5 2.7 ytd 35.3 7.3 prefer a selective buy strategy: we maintain our positive view on thai banks on solid loans and earnings growth prospects and healthy close price 10 oct 2012 balance sheets. however, the ytd share

11、price outperformance of the sector (setbank +36.6% vs. set +27.2%) would seem to somewhat reflect positives issues. we thus prefer selective buy strategy. we see scb, tcap and tisco as medium-term (3-6 months) picks on strong retail loan business, while we like ktb as a long-term investment (1-2 yea

12、rs) on an expected acceleration of government borrowing and an undeserved valuation discount. key stock highlights price as of:current target upside2013f 8 oct 12mkt cap priceprice+/-p/bv p/up per yieldroe stock bay bbl kbank kk ktb scb tcap tisco tmb rec buy buy hold buy buy buy buy buy sell (btbn)

13、 191.3 367.5 430.8 30.3 208.0 562.6 55.0 35.5 78.4 (bt) 31.50 192.50 180.00 47.75 18.60 165.50 41.25 48.75 1.80 (bt) 38.0 232.0 200.0 53.0 25.0 190.0 46.0 54.0 1.64 (%) 20.6 20.5 11.1 11.0 34.4 14.8 11.5 10.8 -8.9 (x) 1.55 1.26 2.01 1.07 1.25 2.23 1.08 1.69 1.33 (x) 5.5 6.2 6.8 5.3 5.0 7.9 2.7 4.6 8

14、.6 (x) 10.4 9.0 10.5 9.0 7.6 11.0 7.0 7.8 16.0 (%) 4.0 4.2 2.2 5.2 5.1 2.7 4.1 5.4 1.9 (%) 15.6 14.6 20.7 12.4 17.6 22.0 16.2 23.1 8.6 source: company reports and kelive research estimates. see appendix i for important disclosures and analyst certifications banking sector table 1: thai banks compara

15、tive valuations 8-oct-12 current price (bt) market cap (btmn) no. of shares - end 2011 (mn) recommendation target price % upside to target bay 31.50 191,336 6,074 buy 38.0 21% bbl 192.50 367,452 1,909 buy 232.0 21% kbank 180.00 430,787 2,393 hold 200.0 11% kk 47.75 30,289 634 buy 53.0 11% ktb 18.60

16、208,046 11,185 buy 25.0 34% scb 165.50 562,566 3,399 buy 190.0 15% tcap 41.25 54,993 1,333 buy 46.0 12% tisco 48.75 35,486 728 buy 54.0 11% tmb 1.80 78,352 43,529 sell 1.64 -9% sector price/bv (x) 2010 2011 2012f 2013f 1.93 1.87 1.71 1.55 1.59 1.51 1.39 1.26 3.19 2.78 2.36 2.01 1.31 1.27 1.15 1.07 1

17、.65 1.60 1.42 1.25 3.65 3.03 2.62 2.23 1.52 1.44 1.22 1.08 2.40 2.19 1.94 1.69 1.57 1.50 1.41 1.33 2.24 2.05 1.80 1.59 price/underlying profits (x) 2010 2011 2012f 2013f 7.74 6.88 6.42 5.45 8.37 7.96 7.20 6.21 11.60 9.07 7.71 6.80 5.73 6.43 5.86 5.29 7.83 5.72 5.01 4.99 14.61 11.49 9.31 7.93 3.14 3.

18、77 3.26 2.72 5.81 5.78 5.40 4.64 16.06 10.92 10.21 8.63 9.53 8.11 7.04 6.15 per - fully diluted (x) 2010 2011 2012f 2013f 21.76 20.65 13.14 10.39 14.94 13.44 10.96 9.02 21.49 17.78 12.36 10.51 9.62 10.62 10.25 8.97 13.95 12.22 8.68 7.55 23.24 15.51 13.46 10.96 9.35 10.54 8.46 7.04 12.28 10.86 9.44 7

19、.82 24.47 19.54 16.65 16.01 18.09 15.00 11.62 9.62 dividend yield (%) 2010 2011 2012f 2013f 1.81 2.22 3.17 3.97 2.60 3.12 3.64 4.16 1.39 1.39 1.94 2.22 5.03 5.03 4.19 5.24 2.74 3.33 3.76 5.11 1.81 2.11 2.42 2.72 2.91 2.91 3.39 4.12 4.62 4.82 5.13 5.44 0.83 1.67 1.94 1.94 2.07 2.40 2.91 3.45 roe (%)

20、2010 2011 2012f 2013f 9.2 9.2 13.6 15.6 11.6 11.5 13.2 14.6 15.7 16.7 20.7 20.7 14.7 12.8 10.9 12.4 12.5 13.3 16.3 17.6 16.4 21.3 20.8 22.0 16.2 13.5 15.3 16.2 21.2 21.1 21.8 23.1 6.6 7.9 8.7 8.6 13.1 14.3 16.3 17.5 net profit (btmn) 2010 2011 2012f 2013f 8,793 9,264 14,560 18,410 24,593 27,338 33,5

21、28 40,735 20,047 24,226 34,842 41,001 2,840 2,859 3,185 4,421 14,913 17,027 25,473 34,443 24,206 36,273 41,780 51,349 5,639 5,002 6,231 7,489 2,888 3,267 3,758 4,537 3,202 4,009 4,706 4,893 107,122 129,265 168,064 207,278 eps growth - fully diluted (% yoy) 2010 2011 2012f 2013f 32 5 57 26 20 11 23 2

22、1 36 21 44 18 17 -9 4 14 22 14 41 15 17 50 15 23 11 -11 25 20 52 13 15 21 65 25 17 4 24.4 20.6 29.1 20.8 eps - fully diluted (bt) 2010 2011 2012f 2013f book value (bt) 2010 book value (bt) 2011 book value (bt) 2012f book value (bt) 2013f dps (bt) 2010 dps (bt) 2011 dps (bt) 2012f dps (bt) 2013f assu

23、mptions behind target prices sustainable roe lt growth cost of equity implied p/bv multiple 1.45 1.53 2.40 3.03 16.28 16.87 18.42 20.33 0.57 0.70 1.00 1.25 bay 17.5% 5.5% 11.9% 1.87 12.88 14.32 17.56 21.34 120.79 127.73 138.79 152.63 5.00 6.00 7.00 8.00 bbl 16.0% 5.0% 12.2% 1.52 8.38 10.12 14.56 17.

24、13 56.38 64.68 76.24 89.62 2.50 2.50 3.50 4.00 kbank 21.0% 5.0% 12.2% 2.23 4.97 4.50 4.66 5.32 36.53 37.65 41.61 44.69 2.40 2.40 2.00 2.50 kk 14.0% 5.0% 12.6% 1.18 1.33 1.52 2.14 2.46 11.25 11.61 13.13 14.89 0.51 0.62 0.70 0.95 ktb 17.5% 5.0% 12.5% 1.67 7.12 10.67 12.29 15.11 45.40 54.68 63.23 74.09

25、 3.00 3.50 4.00 4.50 scb 22.5% 5.5% 12.1% 2.56 4.41 3.91 4.88 5.86 27.07 28.70 33.85 38.31 1.20 1.20 1.40 1.70 tcap 15.5% 5.0% 12.4% 1.20 3.97 4.49 5.16 6.23 20.30 22.27 25.08 28.88 2.25 2.35 2.50 2.65 tisco 19.0% 5.0% 12.5% 1.87 0.07 0.09 0.11 0.11 1.14 1.20 1.27 1.35 0.02 0.03 0.04 0.04 tmb 14.5%

26、5.0% 12.9% 1.21 source: set, company reports and kelive research estimates. *implied target p/bv multiple derived from (roe g)/(coe g) 11 october 2012page 2 of 12 banking sector earnings momentum in 3q12f to slow we project that the nine banks we cover will report an aggregate 3q12f net profit of th

27、b44.6b, up 1% qoq and 24% yoy. earnings growth momentum this quarter will slow from 1h12. we expect bay, ktb, scb and tisco to report net profit at new quarterly highs. table 2: thai banks 3q12f earnings preview btmn net interest income non interest income non interest expense pre-provision profit b

28、ay 10,393 5,326 7,827 7,892 bbl kbank 13,919 16,006 8,028 10,668 9,354 11,628 12,593 15,047 kk 1,834 895 1,372 1,357 ktb 14,756 6,382 8,891 12,246 scb 15,927 10,618 10,437 16,108 tcap 6,407 3,480 5,675 4,213 tisco 1,845 1,376 1,460 1,762 tmb 4,137 1,706 3,635 2,207 sector 85,225 48,479 60,278 73,426

29、 %qoq 3.0% 3.9% 1.7% 4.7% %yoy 8.7% 11.7% 8.6% 10.7% provision expense2,7801,6601,9622732,5142,18076545194413,5293.9%0.5% pre-tax profit5,11310,933 13,0851,0839,73213,9283,4481,3101,26459,8974.9%13.3% net profit3,9208,2899,4708307,59110,6301,6051,0021,24544,5831.1%23.8% eps (b)0.654.343.961.230.683.

30、131.261.380.03 norm profit3,9208,2899,4708307,59110,6301,6051,0021,24544,5831.1%23.8% norm eps (b)0.654.343.961.230.683.131.261.380.03 assets equities loans deposits 1,038,7692,299,5561,956,929 243,2492,165,6262,065,559 962,615 245,733 675,62511,653,659 111,717 262,373 179,500 34,200 145,235 209,302

31、 42,032 17,148 54,438 1,055,945 741,2021,475,4491,245,863 156,2221,501,0201,453,430 679,660 225,641 397,423 7,875,910 659,7351,756,5141,378,655 149,2591,633,2491,509,809 655,830 158,784 490,176 8,392,011 2.6% 5.3% 3.1% 6.8% 2q12a 12.6% 15.6% 13.9% 24.8% 3q11a l/d ratio nim asset yields funding cost

32、spread cost-to-income ratio npls coverage ratio provision/bot required roe 112% 4.37% 6.39% 2.38% 4.01% 50% 2.0% 133% 164% 14.3% 84% 2.51% 4.22% 1.75% 2.47% 43% 2.6% 192% 232% 12.8% 90% 3.56% 5.08% 1.75% 3.33% 44% 2.0% 157% 154% 21.7% 105% 3.25% 6.47% 3.33% 3.14% 50% 3.4% 109% 142% 11.3% 92% 2.86% 4

33、.78% 2.04% 2.74% 42% 3.4% 73% 109% 21.5% 96% 3.28% 5.11% 2.00% 3.11% 39% 1.9% 155% 154% 20.8% 104% 2.83% 5.44% 2.73% 2.71% 57% 5.0% 72% 125% 15.6% 142% 3.12% 6.46% 3.36% 3.10% 45% 1.2% 181% 190% 24.1% 81% 2.61% 4.42% 1.97% 2.45% 62% 5.2% 85% 142% 9.3% 94% 3.11% 5.03% 2.06% 2.96% 45% 3.1% 120% 156% 1

34、7.3% 97% 3.09% 4.98% 2.04% 2.94% 46% 3.3% 117% 153% 17.7% 103% 3.25% 4.99% 1.91% 3.08% 46% 3.9% 102% 141% 15.9% source: company reports and kelive research estimates. tisco, scb and bay should show outstanding growth both qoq and yoy, while bbls earnings are likely to be lacklustre. other banks are

35、expected to report flat qoq earnings. table 3: thai banks 3q12f net profit forecast btmn bay bbl kbank kk ktb scb tcap tisco tmb sector 3q11 3,007 7,551 7,761 874 5,492 8,351 1,337 899 750 36,022 2q12 3,699 8,874 9,367 818 7,384 10,074 1,709 920 1,263 44,107 3q12f 3,920 8,289 9,470 830 7,591 10,630

36、1,605 1,002 1,245 44,583 %qoq 6% -7% 1% 2% 3% 6% -6% 9% -1% 1% %yoy 30% 10% 22% -5% 38% 27% 20% 11% 66% 24% source: company reports and kelive research estimates. table 4: thai banks ppop btmn bay bbl kbank kk ktb scb tcap tisco tmb sector 3q11 6,875 12,804 13,294 1,477 10,418 14,133 3,239 1,576 2,5

37、13 66,328 2q12 7,845 12,214 14,450 1,523 11,096 15,007 4,023 1,776 2,211 70,147 3q12f 7,892 12,593 15,047 1,357 12,246 16,108 4,213 1,762 2,207 73,426 %qoq 1% 3% 4% -11% 10% 7% 5% -1% 0% 5% %yoy 15% -2% 13% -8% 18% 14% 30% 12% -12% 11% source: company reports and kelive research estimates. 11 octobe

38、r 2012page 3 of 12 tiscotisco tcap tmb tcap kbankkbank sectorsector baybay tmbscb ktb scbktb kk bbl kk bbl banking sector table 5: thai banks net interest income btmn bay bbl kbank kk ktb scb tcap tisco tmb sector 3q11 9,733 13,853 14,680 1,676 13,338 13,533 6,136 1,741 3,747 78,438 2q12 10,052 13,9

39、33 15,465 1,921 14,289 15,172 6,164 1,729 4,051 82,775 3q12f 10,393 13,919 16,006 1,834 14,756 15,927 6,407 1,845 4,137 85,225 %qoq 3% 0% 3% -5% 3% 5% 4% 7% 2% 3% %yoy 7% 0% 9% 9% 11% 18% 4% 6% 10% 9% source: company reports and kelive research estimates. the sme and retail segments will likely be t

40、he main drivers for loan growth of 3.1% qoq (+9.6% ytd). auto hire purchase remains the fastest-growing segment from strong domestic car sales. we expect tisco, scb, tcap and kk to reported outstanding loan expansion in 3q12f, in line with our full-year loan growth projections. table 6: thai banks n

41、et loan growth btbn bay bbl kbank kk ktb scb tcap tisco tmb sector 3q11 667 1,326 1,162 126 1,283 1,198 611 177 366 6,917 2q12 729 1,461 1,215 149 1,461 1,369 650 205 400 7,641 3q12f 741 1,475 1,246 156 1,501 1,453 680 226 397 7,876 %qoq 1.7% 1.0% 2.5% 4.6% 2.7% 6.1% 4.5% 9.8% -0.7% 3.1% %yoy 11.2%

42、11.2% 7.2% 23.8% 17.0% 21.3% 11.3% 27.3% 8.5% 13.9% source: company reports and kelive research estimates. chart 1: thai banks 3q12f qoq net loans growth 12.0% chart 2: thai banks 9m12f net loans growth 30.0% 10.0% 8.0% 9.8% 6.1% 25.0% 20.0% 24.8% 18.9% 6.0% 4.6%4.5% 15.0% 16.3% 4.0% 2.0% 3.1% 2.7%

43、2.5% 1.7% 1.0% 10.0% 11.3% 9.6% 8.4% 7.4% 6.2%6.2% 5.5% 0.0% 5.0% -2.0% source: company reports and kelive research estimates. -0.7% 0.0% source: company reports and kelive research estimates. nim remains at 3.11% on flat funding costs. table 7: thai banks net interest margin 3q112q123q12fqoq (bps)y

44、oy (bps) bay bbl kbank kk ktb scb tcap tisco tmb sector 4.52% 2.82% 3.65% 3.89% 3.02% 3.32% 2.94% 3.47% 2.46% 3.25% 4.33% 2.57% 3.53% 3.70% 2.82% 3.21% 2.81% 3.01% 2.52% 3.09% 4.37% 2.51% 3.56% 3.25% 2.86% 3.28% 2.83% 3.12% 2.61% 3.11% 5 -6 3 -46 4 7 2 11 8 2 -15 -31 -8 -65 -16 -4 -10 -35 15 -14 sou

45、rce: company reports and kelive research estimates. 11 october 2012page 4 of 12 1q052q053q054q051q062q063q064q061q072q073q074q071q082q083q084q081q092q093q094q091q102q103q104q101q112q113q114q111q122q12 3q12f tisco kbank tcap tmbscbktb kk sector bay bbl banking sector chart 3: thai banks net interest

46、marginchart 4: thai banks 3q12f net interest margin 7.0% 4.5% 4.37% 6.0% 5.03% 4.0% 5.0% 3.56% 4.0% 3.11% 3.5% 3.28% 3.25% 3.0% 3.0% 3.12% 3.11% 2.86% 2.83% 2.0% 1.0% 2.06% 2.5% 2.61% 2.51% 0.0% 2.0% nimasset yieldfunding cost source: company reports and kelive research estimates.source: company rep

47、orts and kelive research estimates. fee income growth is forecasted at 4% qoq driven by retail banking business i.e. bancassurance, mutual funds and credit cards. vayupak dividend (for ktb, scb, tcap and bay) will drive non-nii growth. table 8: thai banks net fee income btmn bay bbl kbank kk ktb scb

48、 tcap tisco tmb sector 3q11 2,750 4,468 5,498 389 2,928 5,409 832 728 944 23,947 2q12 3,260 4,701 5,965 450 3,154 5,057 1,022 924 1,107 25,640 3q12f 3,326 4,771 6,153 485 3,259 5,399 1,080 970 1,097 26,540 %qoq 2% 1% 3% 8% 3% 7% 6% 5% -1% 4% %yoy 21% 7% 12% 25% 11% 0% 30% 33% 16% 11% source: company

49、 reports and kelive research estimates. the cost-to-income ratio should fall slightly, by 0.7ppt qoq, to 45%. table 9: thai banks cost to income ratio 3q112q123q12fqoqyoy bay bbl kbank kk ktb scb tcap tisco tmb sector 52.3% 40.0% 43.6% 41.8% 44.6% 39.8% 64.7% 44.4% 55.6% 45.6% 49.4% 44.6% 44.2% 44.3

50、% 43.9% 40.1% 57.9% 44.4% 61.1% 45.8% 49.8% 42.6% 43.6% 50.3% 42.1% 39.3% 57.4% 45.3% 62.2% 45.1% 0.4% -2.0% -0.6% 6.0% -1.8% -0.8% -0.5% 0.9% 1.1% -0.7% -2.5% 2.6% 0.0% 8.5% -2.6% -0.5% -7.3% 0.9% 6.6% -0.5% source: company reports and kelive research estimates. credit costs is likely to rise from

51、ktbs extra provision and tcaps turning back to normal level after extra low in 2q12. there is still no concern on npls. table 10: thai banks provisioning expenses btmn bay bbl kbank kk ktb scb tcap tisco tmb sector 3q11 2,624 1,685 1,719 372 3,012 1,872 129 302 1,747 13,463 2q12 2,990 1,664 1,894 56

52、0 1,543 2,365 488 591 932 13,026 3q12f 2,780 1,660 1,962 273 2,514 2,180 765 451 944 13,529 %qoq -7% 0% 4% -51% 63% -8% 57% -24% 1% 4% %yoy 6% -1% 14% -27% -17% 16% 493% 50% -46% 0% source: company reports and kelive research estimates. 11 october 2012page 5 of 12 tisco 2012f2013f2014f tcap 2002 200

53、3 2004 2005 2006 2007 2008 2009 2010 2011 2012f2013f2014f 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012f 2013f kbank sector bay 2014f 20042005200620072008200920102011 tmbscbktb kk bbl 3.08% banking sector likely earnings decline in 4q12f, but solid full-year growth overall, we expect 9m12f

54、thai bank earnings to reach 77% of our full year forecast, even though we think earnings will contract in 4q12f on seasonally rising opex and extra provisioning at ktb. we maintain our net profit growth forecast of 30% this year and 23% in 2013f. the key supports will be healthy loan growth next yea

55、r, on 1) continuing momentum in the retail loan sector, 2) accelerated public investment and 3) private investment in the upcoming aec. fee income will expand, while nims are expected to gradually improve as pricing power returns to commercial banks. the reduction in corporate tax rates to 20% from

56、23% will be another support to earnings. chart 5: thai banks loans growthchart 6: thai banks 2013f loans growth 20.0% 18.0% 17.7% 25.0% 23.6% 16.0% 14.0% 12.0% 10.0% 8.0% 6.6% 6.0% 9.6% 13.9% 5.7% 8.3% 6.3% 12.2% 15.1%14.6% 10.9%10.5% 20.0% 15.0% 10.0% 16.4% 14.1% 12.5% 10.9% 9.5%9.5%9.4% 8.6%8.5% 4

57、.0% 2.0% 0.0% 1.1% 5.0% 0.0% source: company reports and kelive research estimates. chart 7: thai banks net interest margin source: company reports and kelive research estimates. chart 8: thai banks fee income growth 3.50% 3.30% 3.10% 2.90% 2.70% 2.50% 2.89% 2.46% 3.36% 3.02% 3.30% 3.12%3.16% 3.18%3

58、.13%3.22% 25.0% 20.0% 15.0% 12.7% 23.4% 13.9% 15.4% 13.2% 13.7% 21.9% 16.9% 15.7% 12.1% 2.30% 2.10% 1.87% 10.0% 7.8% 1.90% 1.72% 1.70% 1.50% source: company reports and kelive research estimates. 5.0% 0.0% source: company reports and kelive research estimates. we expect bay, ktb and kbank to report

59、outstanding net profit growth this year while kk, ktb and bay will be the best performers in the banking sector in term of earnings growth in 2013f. 11 october 2012page 6 of 12 tisco tisco tcap tmb kbanksector tcap 2012f2013f kbank sector baybay 2014f 2002 2003 2004 2005 2006 20072008 2009 2010 2011

60、 tmbscb ktb scbktb kkkk bbl bbl banking sector chart 9: thai banks 2012f net profit growth 70.0% chart 10: thai banks 2013f net profit growth 45.0% 60.0% 57.2%40.0% 38.8% 35.2% 49.6%35.0% 50.0% 43.8% 30.0% 26.4% 40.0% 30.0% 30.0% 24.6% 22.6% 25.0% 20.0% 23.3% 22.9% 21.5% 20.7% 20.2% 17.7% 20.0% 10.0