JP Morgan Denominates SCB a Top-Pick Stock with Price Objective Stands High at THB130

SCB X Public Company Limited (SET: SCB) announced yesterday that the company had signed a sale and purchase agreement to acquire 100% of the charter capital of Home Credit Vietnam Finance Company Limited (Home Credit Vietnam), the consumer finance business of Home Credit N.V. (Home Credit Group) in Vietnam.

With an investment value of THB 31 billion to acquire 100% in Home Credit Vietnam, it will be SCB’s first expansion into Vietnam and will also mark a significant milestone in SCB’s journey to become a leading regional financial technology group.

SCB expects the acquisition of Home Credit will serve as an important base for the group company’s presence in Vietnam and immediately contribute to the bottom line after the completion of the deal.


JP Morgan just published a research a day before the announcement, stating that the value is inexpensive, but it will grant SCB an access to Vietnam’s fast-growing consumer finance market.

The acquisition should give 1-3% accretion to EPS by 1-3% over 2024-25, assuming ESP growth for Home Credit Vietnam of 10-20%, while expecting the deal to post small impact to Capital Adequacy Ratio.

JP Morgan gives Overweight rating on SCB, saying the group should offer 80% dividend payout ratios through 2026. Meanwhile, the issue around asset quality deterioration, and the resultant move up in provisions are now close to being substantially discounted. It is expected that the negative revision cycle by the street on EPS, price target and recommendation should end.

JP Morgan noted that SCB is its top pick among commercial banks in Thailand due to an attractive dividend yield, while giving a target price at THB 130 per share, a 15% upside to the current share price.