Krungsri Securities (KSS) remains bullish on the Thai ICT sector, highlighting TRUE as its top pick following the conclusion of the recent spectrum auction, which wrapped up under the supervision of the National Broadcasting and Telecommunications Commission (NBTC). The auction, which was monitored closely by industry observers, concluded with relatively low competitive pressure, according to KSS, but revealed some noteworthy surprises in the allocation of key spectrum bands.
Auction Results: TRUE Outpaces Expectations
AIS (ADVANC) and TRUE emerged as the primary winners in this latest spectrum allocation, but TRUE’s achievements stood out. ADVANC secured three lots in the 2100MHz frequency band at a final cost of THB 14.85 billion, marking a 10% increase over the opening bid. Meanwhile, TRUE clinched two critical bands for a total license payment of THB 26.4 billion, about 17.9% above the starting price.
Breaking down TRUE’s winnings: The company took home all four available lots in the 1500MHz band, paying THB 4.6 billion (up 10% from the outset). Additionally, TRUE claimed all seven lots in the 2300MHz band with a winning bid of THB 21.7 billion, a 19.8% gain over the minimum price. KSS noted that while license prices for all three auctioned bands finished roughly 15% higher than their initial levels, overall competition was not as fierce as previously anticipated. This lighter bidding intensity enabled operators like ADVANC and TRUE to acquire strategic spectrum while maintaining notable cost efficiencies.
Financial Implications: Room for Upward Earnings Revisions
KSS analyzed the likely impact of these outcomes on the profit-and-loss and cash flow statements of ADVANC and TRUE. For ADVANC, the amortization of these new license costs is expected to save approximately THB 2.9 billion—compared to the THB 3.9 billion annual rental previously paid to NT for similar bandwidth. This improved cost structure should translate into an estimated 3% increase in EPS by 2025 and a 7% rise in 2026. The earnings uplift in 2025 is slightly muted as the new licenses only commence from August 4, 2025, leading to a partial impact for that financial year.
TRUE stands to benefit even more, with analysts forecasting savings of around THB 2.5 billion due to lower amortization expenses vis-à-vis the THB 4.3 billion in rental fees previously paid to NT. The result: projected earnings growth of 7.2% in 2025 and a solid 13.5% in 2026. Like ADVANC, TRUE’s 2025 results will reflect only a five-month contribution from the new licenses.
Outlook: TRUE Remains Sector Leader
Given these developments, Krungsri Securities reaffirms its Buy ratings on both ADVANC and TRUE and suggests a potential upward revision to target prices on the back of stronger-than-expected earnings dynamics. With its sweeping spectrum wins and promising growth outlook, TRUE remains KSS’ preferred pick among Thai telecoms for 2025, buoyed by anticipated robust earnings momentum in the years ahead.
