KGI Securities notes in its report that Central Retail Corporation Public Company Limited (SET: CRC) is set to navigate another challenging quarter amid persistent economic weakness in Thailand.
Consumer confidence in Thailand has continued on a downward trend, with the index dropping for five straight months to 52.7 in June 2025. Meanwhile, international tourist arrivals between January 1 to July 6, 2025 totaled just 17.2 million, representing just 47% of the analyst’s full-year projection of 36.5 million and signaling potential downside risk.
For the second quarter of 2025, KGI projects CRC will deliver a normalized profit of THB 1.6 billion, up 10% year-on-year thanks to lower interest expenses, but down 34% from the previous quarter due to typical seasonal factors.
The brokerage firm expects CRC’s 1H25 normalized profit to reach THB 4 billion, a modest 2% increase from the prior year and accounting for 51% of the full-year estimate.
CRC’s same-store sales (SSS) are expected to remain in negative mid-single digits in the second quarter, following a 4% contraction in the first. Weak performance is anticipated across all segments: hardline sales could see a high single-digit decrease, fashion and food are likely to endure mid- to high-single-digit declines.
Vietnam remains the laggard, with SSS projected to fall by low teens, followed by Italy and Thailand, which are expected to post high and low-to-mid single-digit declines, respectively.
The company’s margins are likely to come under pressure from promotional campaigns, with gross margin for Q2 forecast at 25.9%, slipping 0.7 percentage points year-on-year but improving modestly from the previous quarter.
Looking ahead, KGI notes that CRC typically sees stronger performance in the fourth quarter during the high season. However, ongoing weak consumer sentiment is anticipated to weigh on sales and profitability. As a result, there is limited upside for full-year earnings, even with first-half results on track to meet half of the analyst’s full-year forecast.
KGI Securities maintains a ‘Neutral’ stance on CRC and reiterates the end-2025 target price for CRC at THB 18.00 per share, derived from a weighted average PER of 13.5x across all business segments.
As of 11:27 AM (Bangkok time) on Tuesday, the share price of CRC surged by 4.84% or THB 0.90 to THB 19.50, with a trading value of THB 257.93 million.
