CGS International Securities (Thailand) (CGSI) has a neutral view following the latest analyst meeting with BTS Group Holdings Public Company Limited (SET: BTS), citing ongoing uncertainties and muted near-term catalysts.
BTS management reported ongoing negotiations with the government regarding the recently announced THB 20 flat fare scheme. Under the proposed policy, BTS is expected to receive full compensation if the initiative causes total revenues to dip below the current baseline. However, should the scheme generate additional income, BTS would likely have to share those incremental gains with the government.
Management flagged that higher ridership triggered by the discounted fare could also lead to elevated operating costs, diluting any potential net benefit to the company’s bottom line.
Meanwhile, losses from BTS’s Pink and Yellow Line monorail projects weighed heavily on the group’s financials, contributing a THB 1.6 billion loss in FY24/25—a trend CGSI expects to continue in the near term. The brokerage firm also warned that BTS may be required to book impairments on these investments in the fourth quarter of FY2025/26, given persistently low ridership levels.
As the analyst meeting delivered little in the way of new developments or positive surprises, CGSI maintained its ‘Hold’ rating on BTS, with a target price of THB 3.5 per share.
