2023-12-23 22:00:00
Travel stocks are more worth watching. After entering the tourist season in the 4th quarter of 2023, especially the celebration of the New Year Festival 2024, securities analysts Pointing to positive signs of a recovery in tourist numbers. From entering the high season Ready to evaluate next year’s profit trend as bright
Securities analyst Asia Plus Securities Company Limited stated in its analysis that The number of foreign tourists coming to Thailand during 1 Jan. – 17 Dec. 2023 is at 26.45 million people, in line with the full year assumption of 27 million people, considering that during the last week of the year there will be momentum from the year-end event during the year. new and the European travel season, while in 2024 it is expected that foreign tourists to Thailand will be 31.5 million, an increase of 14.9% from 2023.
At the same time, the research department maintains a normal profit view. Excluding special items from 4Q2023 to 1Q24, stocks with income mainly in Thailand (except MINT) climbed from the previous quarter. Supported by entering the high season. However, the weekly tourist numbers above are not very hot. As a result, the competition in average room rate (ADR) of hotels in Thailand in 2024 will be more closely watched by the market.
Strategically, the research department views that Shares of Minor International Public Company Limited or MINT shares will be able to outperform with an appropriate price of 38 baht after the share price since the beginning of the year has dropped 16.3% compared to the Thai stock market index which has decreased 16.4%. This is expected to be due to Mainly concerned about energy prices in Europe. (Quarterly profits are in line with the tourist season in Europe.) At present, electricity prices in the EU have gradually decreased to a level lower than before the unrest in the Middle East. In addition, the MINT stock price seems too counter-intuitive to European hotel stocks, reflected in the STOXX Europe 600 Travel & Leisure, which increased from the beginning of 2023 at 22%.
Company shares Airports of Thailand Public Company Limited or AOT shares estimates current profits in 2024 at 23 billion baht, growing 154% from 2023 or accounting for 95% of pre-Covid profits. This is lower than the estimate of Bloomberg Consensus as of 19 Dec. 2023 at 24 billion baht, approximately 3%, so it is still possible to monitor operations for the 1st quarter of 2024 (Oct.–Dec. 2023) again before revising the estimate. In terms of AOT’s share price minus 19.7%, starting to make Risk to reward attractive as the main gateway to Thailand. Do not have to face competition factors in the country. Compared to Thai hotel stocks
Analysis side Maybank Securities (Thailand) Public Company Limited stated that it still has a positive view of the hotel group. This is because profits are expected to grow strongly in 2024-2025, which will be driven by demand from foreign tourists. increasing profit margin and expansion of new hotels We believe that the stock price has already reflected the trend of core earnings contraction in 4Q23. As a result, we expect positive momentum to recover again in 1Q24, supported by demand from Chinese tourists and Profit margin of food business
Meanwhile, the demand for leisure travel is increasing. And the recovery of customers in the business travel (MICE) segment will boost hotel group profits in 2024 to record highs, or grow 21% from the previous year. We also expect the important international tourist market to recover. such as Europe, South Asia, Oceania, and the Middle East. Meanwhile, the slow recovery of Chinese tourists Especially in group tour groups. will have limited impact This is because they are not the main target group for listed hotel operators. In addition, mainland tourists tend to spend less on accommodation compared to other countries. Meanwhile, the length of stay will be relatively short for Chinese guests.
However, shares of Minor International Public Company Limited or MINT are still our top stocks. This is due to strong profit growth and the cheapest share price. We believe the number of corporate customers will reach pre-pandemic peaks in 2024, which will support F&B room rates and growth and operating margins.
We also recommend buying the company’s shares. Central Plaza Hotel Public Company Limited or CENTEL shares as they benefit from the recovery of Chinese tourists. Amid the decreasing cost of food and utilities in the country. We expect CENTEL to have the highest profit growth in the group at 30% per year over 2024-2026, while the price remains attractive.
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