Kiatnakin Phatra Securities maintains its “BUY” rating on Asset World Corp Pcl (SET: AWC) after the company’s 1Q23 performance results were in line with expectations, indicating that the operations are continuing to recover.
In 1Q23, AWC reported a net profit of THB1,422 million, a 100.5% YoY increase, and higher than 2019 which was the pre COVID-19, supported by significant growth in the hospitality business, resulting from the country’s reopening in 2022.
Revenues for the quarter were at THB4,785 million, an increase of 65.5% YoY, reflecting the implementation of the growth-led strategy to create effective cash flow growth. For the hospitality business, there was continuous growth in all segments.
The average Revenue Per Available Room (RevPAR) was THB4,152, increasing 17% compared to 2019. Additionally, AWC aims to increase operating assets through the growth-led strategy resulting in the current operating assets of THB119,859 million, or 43.9% increase from 2019.
According to a note released by Kiatnakin Phatra Securities on Tuesday, AWC’s first-quarter financial results were in line with expectations, suggesting that AWC’s operations saw a sustained recovery driven by the steady improvement of the hotel business, which helped to offset softer retail and commercial property operations.
Kiatnakin Phatra has set the price target for AWC shares at THB5.45, but noted that the company’s QoQ growth could slow in the second quarter due to the seasonality of the tourism industry, before picking up in 3Q-4Q23.