Citigroup has maintained a ‘Neutral’ rating for Osotspa Public Company Limited (SET: OSP), setting a target price at THB 15 per share, highlighting the company’s robust operational execution in the first quarter of 2026 as a key factor offsetting ongoing challenges in its overseas markets.
For 1Q26, Citi projects OSP will report core earnings of THB 1.1 billion, reflecting a 13% year-on-year and 33% quarter-on-quarter increase. The broker notes that this result is ahead of market consensus, mainly due to a stronger-than-expected EBIT margin expansion, which is set to reach a record high.
Despite the impressive bottom-line growth, Citi points out that total sales for OSP are expected to decline by 7% YoY, primarily due to headwinds from Myanmar’s ongoing import restrictions, which have hampered OSP’s overseas supply chain. Nevertheless, OSP’s savings on raw materials, streamlined production processes, and strict operating expense management have successfully mitigated the impact of weaker sales.
Looking forward to the second quarter of 2026, Citi expects OSP’s cost outlook to remain favorable, buoyed by previously secured input prices. The recovery in overseas sales, however, is likely to be gradual and will depend heavily on regulatory developments in Myanmar.
While earnings growth for 2026 is likely to be underpinned by continued cost savings and production rationalization, the firm warns that rising competition—following a competitor’s price rollback in March—could cap upside potential for OSP in the near-term.
