Krungsri Securities (KSS) has released an analysis regarding Bangkok Expressway and Metro Public Company Limited (SET: BEM), following the recent conference call. The analyst highlighted several key points impacting BEM’s outlook for 2025 as follows:
1) BEM reported a 25% quarter-on-quarter decline in commercial revenue during the first quarter of 2025, remaining flat year-on-year. This dip is attributed to the expiration of contracts with DTAC, signed before the merger between DTAC and TRUE, impacting quarterly commercial revenue by 10-15 million baht.
2) The company acknowledged that anticipated growth of 1-2% in toll road revenue and double-digit growth in mass transit for the full-year 2025 might not materialize due to incidents such as an earthquake, construction material collapse, and broader economic pressures.
3) Details on the government’s subsidy for the proposed 20 baht flat fare for the Mass Rapid Transit (MRT) remain sparse, leaving uncertainty about how operators will be compensated and the extent of the subsidy.
In light of these developments, KSS upholds earnings projection for the company at 3.9 billion baht, reflecting a 3.8% year-over-year increase. The analyst’s conservative stance, juxtaposed with management’s guidance, forecasts no revenue growth in toll roads and a 6% increase in mass transit revenue, projecting overall revenue growth at 3% for the year 2025.
Meanwhile, the potential benefits of the 20 baht flat fare, expected to be implemented in September 2025, have not yet been incorporated into the forecast.
As of 11:22 AM (Bangkok time) on Monday, the share price of BEM dropped by 2.54% or 0.15 baht to 5.75 baht per share, with a trading value of 98.21 million baht.
The analyst continues to recommend BEM as a value play stock, noting that the recent share price drop has introduced multiple concerns. Although earnings growth in 2025 is projected to slow year-over-year, it is expected to reach new highs.
As a result, KSS maintains a ‘Buy’ rating on BEM with a target price of 9.1 baht per share.
