PTTEP Edges Slightly Lower in Concerns of Higher Provisions from Class Action in Australia

The share price of PTT Exploration and Production Public Company Limited (SET: PTTEP) closed in the morning session on November 21, at 185.50 baht per share, decreased 1.50 baht or 0.80%. The highest price was at 186.00 per share, and the lowest at 183.50 per share, with a total trading value of THB 1,167 million.

Capital Nomura Securities Public Company Limited (CNS) said in the research that the negative outlook tendency for record expenses is estimated at 129 million US dollars, or approximately 4,644 million bath (refer to the exchange rate of 36 baht/the U.S.dollars), according to the company’s announcement, the Federal Court of Australia will issue its judgment in mediation in the class action with the group of seaweed farmers. The court decision is expected to be in the first quarter of 2023, while the company is expected to book this expense in provisions for the fourth quarter of 2022. The expense will be approximately 4,644 million baht, with a downside estimate of 6.5% to PTTEP’s 2023 earnings forecast by Capital Nomura Securities at 71,716 million baht or a downside of 1.17 baht per share or -0.6%.

CNS recommends Trading Buy with a target price of 183.50 baht per share in 2023, and advises investors to wait after all the slow down in net profit from extraordinary items, reconciliations, impairment of Mozambique field and peak-season expenditure, in which investors could start to speculate in the first quarter of 2023 that should be boosted by lower expense, accelerating sales volume, and progress in Lang Lebah.