TRUE Shares Resume Trading at THB8.55 after Merger with DTAC Completes

The shares of True Corporation resumed trading on Friday after Thailand’s number two phone operator and Total Access, widely known as DTAC, concluded their merger earlier this week.

On Friday (March 3), shares of True Corporation (SET: TRUE) were traded at a price of THB8.55 per share, for a total market value of THB2,754 million, a decrease from the closing price of THB8.51 on February 17, the final trading day before trading was suspended to complete the merger.

True Corporation Pcl. (TRUE) and Total Access Communication Pcl. (DTAC) on Wednesday (March 1) have completed their amalgamation process by receiving the commercial license from the Department of Business Development, Ministry of Commerce under the name “True Corporation Public Company Limited.” Upon completion of the merger, TRUE overtook Advanced Info Service (AIS) as the largest telecommunications provider in the second largest economy in Southeast Asia.

Before trading was suspended to finalize the merger, the combined market capitalization of the two companies was THB294 billion.

Krungsri Securities has a BUY rating for TRUE with a higher target price of THB10.0 (from THB8.4) after upgrading earnings (raised ARPU). This is premised on the following: (i) the brokerage is bullish on the sector as pricing competition would subside from this year; TRUE does not need to adopt a pricing policy to grow subs because there will be only two players in the mobile and FBB market – TRUE and ADVANC. (ii) TRUE will book a profit immediately and much higher than the combined earnings of the two old firms; and (iii) EV/EBITDA will drop from 8.7x (FY23) with its cost-saving strategy.