PLANB Expected to See Earnings Growth in 2024F Driven by OOH Media Momentum

KGI Securities maintained an ‘Outperform’ rating for PLANB, following a solid growth outlook.

KGI Securities stated in its report that PLANB is projected to benefit from the sustained momentum of out-of-home (OOH) media, leading to an anticipated increase in ad revenue year-over-year and quarter-over-quarter in 2024.

According to Nielsen data, OOH ad spending continued to surpass overall media performance in the fourth quarter of 2024, with an 8% YoY growth compared to 4% YoY in total advertising spending. The company’s guidance indicates an improved utilization rate of 72-73% in April-May, up from 69.7% in the first quarter of 2024, with an expected rise to 75% for the full year.

PLANB is expected to expand its capacity by approximately 30-50 million, focusing on digital billboards and airport expansions, which is projected to grow by 6-7% YoY. In the second quarter of 2024, the engagement marketing business, accounting for 20% of revenue, is expected to witness significant improvements in both YoY and QoQ.

This growth is attributed to the revenue realization of around THB 300 million from promoting the Paris Olympics and increased revenue from sports events such as combat sports and football.

The company’s earnings in the second quarter of 2024 are anticipated to continue growing supported by robust revenue growth in OOH advertising and engagement marketing, as well as enhanced gross margins from higher utilization rates and price adjustments.

The analyst maintained earnings forecasts for PLANB at THB 1.1 billion in 2024F (+24% YoY) and THB 1.2 billion in 2025F (+10% YoY), driven by increased revenue and improved gross margins.

Given the expected strong earnings growth, the analyst maintained an ‘Outperform’ rating for PLANB with a 2024 target price of THB 10.70 per share.

PLANB is trading at THB 8.00 per share in the morning session on Friday, up 1.27% or THB 0.10 per share.