Kiatnakin Phatra Securities (KKPS) has raised its target price for Delta Electronics (Thailand) Public Company Limited (SET: DELTA) to THB 285 per share, up from THB 174, primarily due to a shift in valuation methodology and increased earnings forecast tied to the accelerated rollout of NVIDIA’s Vera Rubin platform.
Despite this higher price target, KKPS reiterates its “Underperform” rating as the current share price of THB 364 remains well above its target, with downside risks.
The upward revision comes as KKPS shifts from a +0.5 standard deviation (SD) to a +1 SD methodology to better reflect DELTA’s unique position as Thailand’s only stock with significant artificial intelligence exposure. This adjustment bumps the price-to-earnings ratio (PER) target from 58x to 87x, accounting for the majority of the valuation uplift.
Additionally, expectations of a faster-than-anticipated mass production of NVIDIA’s Vera Rubin platform—now in full production as of May 2026, with shipments in Q3 and a greater ramp-up in Q4—led KKPS to increase its 2026 and 2027 earnings-per-share (EPS) estimates by 10% and 21%, respectively.
However, KKPS cautions that even giving full credit to the earlier benefits from the Vera Rubin production, market expectations remain overly optimistic, with most of the 2027 earnings inflection already priced in. The analyst firm cited several downside risks, including a lack of clarity on royalty fee obligations to Delta Taiwan regarding liquid cooling technology, which remain unresolved.
Furthermore, DELTA’s research and development expenditure, guided at 3.5% of revenue, is lower than that of the parent company, indicating possible future cost increases not fully reflected.
