报告名称：KCE Electronics(KCE.BK)4QFY15 results to be highest of the year
报告类型：海外市场
报告日期：2016-01-27
研究机构：辉立证券
页数：7
简介：4QFY15 net profit to hit year’s high of Bt619mn, up 7% y‐y and 8% q‐q
We expect 4QFY15 to be the best quarter of the year for KCE. Our forecast puts its 4QFY15 netprofit at Bt619mn, up 7% y‐y and 8% q‐q on margin boost. In our forecast, we assume (i) marginsexpanded 2% q‐q as the closure of its aging plant in mid‐4QFY15 allowed it to see expense savingsand brought the company‐wide scrap rate down to 4.2%‐4.3% from 4.6%‐4.7% in the priorquarter, (ii) quarterly sales came in at Bt3,237mn, up 20% y‐y on higher operating rates at itsnewfacility but down 2% q‐q due to the traditional low season for exports, (iii) SG&A expenseswere little changed and (iv) the benefit of a weak baht led to a FX gain of around Bt18mn in4QFY15.
As 4QFY15 results are expected to come in much better than previously thought, we thereforeraise our FY15 earnings forecast for KCE by 4%. Our new forecast shows a 4% y‐y rise in FY15 netprofit to Bt2,194mn based on assumptions that (i) full‐year sales grew 10% y‐y to Bt12,467mn, (ii)margins widened 2% y‐y on the back of higher operating rates at its new facility and (iii) SG&Aexpenses rose at a slower pace after the new plant was in operation.
Earnings growth set to accelerate in FY16 after new facility runs at full capacity
We have a more bullish view on KCE’s earnings growth prospects after last Mon’s analyst briefing.Earnings growth is expected to be strong in FY16 driven by a combination of factors including: (1) fullcapacity run at its new facility, (2) lower scrap rates and (3) expense savings following the closure ofits aging plant. These positive factors would push margins up 2% y‐y in FY16. Sales also tend to farebetter on the back of additional orders from new clients. To reflect better‐than‐expected outlook forFY16, we ratchet up our FY16 net profit forecast for KCE by 9% to Bt2,880mn, which implies a growthof 31% y‐y. Our new forecast assumes (i) FY16 sales will grow 17% y‐y to Bt14,618mn and (ii) SG&Aexpenses will rise at a slower rate on expense savings.
FY16 target price raised to Bt74/share but ‘SELL’ rating maintained
Even if KCE is one of our top picks in the electronics space in view of its continued growth potentialdriven by new client additions to absorb new capacity and high production efficiency at its newfacility, which would be the catalysts to bring it back to strong growth path, it seems to us that muchof its upbeat earnings outlook for FY16 appears to have already been baked into the share price aftera recent price run‐up. On balance, we maintain a ‘SELL’ stance on KCE shares but we nudge up ourFY16 target price to Bt74/share to reflect the above earnings upgrades.

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