KGI Securities (Thailand) expects AP (Thailand) Public Company Limited (SET: AP) to report third-quarter 2026 net profit of THB 1.14 billion, up 7.5% from the previous quarter, supported by healthy equity income despite pressure on residential gross margins. The brokerage maintained its “Outperform” rating and target price of THB 9.40.
Residential revenue is projected at THB 10.7 billion, rising 21% YoY and 2% QoQ. Landed properties are expected to contribute THB 9.8 billion, up 14% from a year earlier, while condominium revenue is forecast to surge 240% to THB 880 million. The newly completed Life CharoenNakorn Sathorn is expected to account for half of condominium revenue.
However, KGI expects gross margin to soften both annually and sequentially to 28.5%, reflecting intense competition amid sluggish housing demand. Operating EBIT could decline 2% QoQ, while projected equity income of THB 115 million should support net profit growth.
For the first nine months of 2026, earnings are forecast at THB 3.1 billion, up 3% YoY and equivalent to 70% of KGI’s full-year estimate. Revenue and EBIT are each expected to grow 17%, although equity income from joint ventures could fall 67.5% to THB 177 million.
KGI noted that further transfers from three newly completed condominiums, continued landed-property sales momentum, improved gross margin, and stronger equity income are key fourth-quarter earnings drivers. Gross margin could recover to nearly 30% as AP recognizes more high-margin condominium revenue. Meanwhile, the THB 5 billion Rhythm CharoenNakorn Iconic project, approximately 90% sold, is expected to contribute higher equity income.
AP’s presales reached THB 41 billion in the first 10 months of 2026, representing 84% of its THB 49 billion annual target. This implies October presales of THB 4.6 billion, slightly above THB 4.5 billion a year earlier, including approximately THB 2 billion in net presales from the Housing and Condo Expo launched in late October.
The company plans fourth-quarter project launches worth at least THB 14 billion, including two affordable condominiums with a combined value of THB 2 billion.
AP has THB 10 billion worth of backlogs, mainly comprising condominiums scheduled for transfer in 2027. Four completed condominium projects worth a combined THB 12 billion, averaging 47% sold, are scheduled for transfer next year. This compares with THB 11 billion of completed condominiums in 2026, which are 72% sold. The company also plans at least THB 50 billion in new launches in 2027, including more upcountry projects and four to five condominiums.
KGI maintained its 2026 – 2027 earnings forecasts, projecting 5% earnings growth in 2027, with potential upside from improving consumer confidence and a possible GDP forecast upgrade.
The brokerage’s THB 9.40 target price applies a 2027 price-to-earnings multiple of 6.3 times, one standard deviation above the historical mean, reflecting AP’s leading presales market share. Assuming a 38% dividend payout ratio, unchanged from 2025, KGI estimates a 2026 dividend yield of 6.7%.
Risks cited include economic conditions, potential government stimulus, strict lending amid persistently high household debt, and minimum wage increases.
