Following the release of 1Q25 earnings reports from Thai listed companies, JPMorgan analysts have expressed their views on Bangkok Life Assurance Public Company Limited (SET: BLA), Srisawad Corporation Public Company Limited (SET: SAWAD), and Osotspa Public Company Limited (SET: OSP).
Bangkok Life Assurance (BLA)
BLA has reported impressive first-quarter 2025 financial results under the new IFRS-17/9 accounting standards. JPMorgan has maintained an ‘Overweight’ rating on the stock, with a target price of THB 27.10 per share, following a robust 6% year-on-year net profit growth for the quarter.
The insurer has faced significant underperformance year-to-date, with its stock down 19% compared to the SET Index’s 13% decline. This is attributed to concerns over earnings reductions amid volatile macroeconomic conditions, potential risks from high-guarantee life policies, and limited clarity on the financial impact of new accounting standards.
Despite these challenges, BLA’s recent performance exceeded expectations, highlighting strong potential for further gains. Key figures include a 1Q25 net profit of THB 1.2 billion, solid profit contributions from its core insurance business, a book value of THB 47.8 billion, and a notable new business contractual service margin growth.
Trading at seven times its projected 2025 earnings with a 4% yield, BLA presents a compelling investment case, according to JPMorgan, as it looks to capitalize on its strong financial footing and navigate current market conditions.
Srisawad Corporation (SAWAD)
Despite delivering a lackluster first-quarter 2025 performance, JPMorgan maintained an ‘Overweight’ stance on SAWAD with a target price of THB 32 per share. However, the analyst cautioned about potential stock weakness in the near-term.
The company reported a net profit of THB 1.1 billion, marking a decline of 13% year-on-year and 10% quarter-on-quarter, falling short of both JPMorgan and Bloomberg consensus estimates by 4% and 8%, respectively.
The continued contraction in SAWAD’s loan portfolio, down 3% from the previous quarter and 8% annually, contributed to an 8 basis points quarter-on-quarter decline in the net interest margin (NIM) to 14.20%.
Management highlighted the impact of loan restructuring related to flood damages from 4Q24, which adversely affected asset yields. Unlike its peers, SAWAD has not joined the Bank of Thailand (BOT)’s debt restructuring program, further differentiating its approach.
On a more positive note, SAWAD reported improved liquidity, with cash as a percentage of assets increasing to 6.7%, significantly up from 3.2% in 3Q24. Despite a 13 basis point rise in credit costs and a significant uptick in non-performing loan (NPL) formation to 270 basis points annually, the company managed to reduce overall operating expenses by 2% quarter-on-quarter due to lower NPL sales losses.
The ongoing challenges, including deteriorating asset quality trends and an 8% loan book contraction over the past three quarters, are expected to exert further pressure on the stock. Meanwhile, SAWAD’s stock has decreased by 7% over the past week, indicating that the market largely anticipated this first-quarter slump.
Osotspa (OSP)
JPMorgan maintains an ‘Overweight’ rating on OSP with a target price of THB 20 per share, following solid first-quarter results marked by a strong margin performance.
OSP posted a core net income of THB 970 million for 1Q25, excluding a THB 295 million gain from divesting MGE, which reflects a 17% year-on-year and 60% quarter-on-quarter growth. The results aligned with JPMorgan estimates, showing no major outliers across key metrics.
Overall sales dipped by 6% year-on-year, primarily due to a decline in the beverage segment, which decreased by 4%. The beverage segment reported revenues of THB 5.58 billion, driven by robust international market growth of 22%, despite weaknesses in the domestic market, which fell 16%.
Additionally, the personal care segment achieved a notable 10% year-on-year revenue increase, fueled by strong performances in Myanmar and Vietnam.
The gross profit margin soared to a record high of 40.3% during the first three months of the year, up from 36.5% a year earlier, largely due to a favorable product mix and reduced raw material costs. Furthermore, selling, general, and administrative expenses were cut by 6% year-on-year, reflecting efficient cost management.
Overall, these factors buoy OSP’s financial health, supporting JPMorgan’s positive outlook.
At 11:06 AM (Bangkok time) on Friday, the share price of Bangkok Life Assurance Public Company Limited (SET: BLA) rose by 1.19% or THB 0.20 to THB 17.00, with a trading value of THB 14.66 million.
Srisawad Corporation Public Company Limited (SET: SAWAD) grew by 1.43% or THB 0.30 to THB 21.30, with a trading value of THB 155.75 million.
Osotspa Public Company Limited (SET: OSP) surged by 2.63% or THB 0.40 to THB 15.60, with a trading value of THB 63.66 million.
