Kiatnakin Phatra Securities (KKPS) has noted that Central Plaza Hotel (SET: CENTEL) has announced two major strategic moves aimed at strengthening its earnings outlook. The company will acquire a second hotel property in the heart of Osaka, while simultaneously dissolving its joint venture operating Café Amazon in Vietnam.
CENTEL’s latest acquisition is a hotel located just 450 meters from the flagship Centara Grand Osaka. The total investment, including acquisition and renovation costs, amounts to JPY 12.7 billion (approximately THB 2.8 billion). CENTEL will hold a 50% stake, with the balance owned by its current joint venture partner. Financing will be split between JPY 5.3 billion in equity and JPY 7.4 billion in debt at an estimated interest rate of 1.8-1.9%, resulting in CENTEL’s equity outlay of about THB 560 million.
The acquired property is already operating with a strong 80-85% occupancy rate and an average daily rate (ADR) of THB 2,600-2,900, delivering an annual net profit of THB 20-30 million. CENTEL plans to close the hotel for renovation and rebranding under the Centara Life in November 2025, with reopening scheduled for 2Q26. Management expects the property to break even in its first year post-reopening. By 2027, KKPS estimates the project will contribute THB 34 million to its profit, split between share income and management fees.
In addition, CENTEL and its partner PTT Oil and Retail Business PCL (SET: OR) have decided to dissolve their 40-60% joint venture operating Café Amazon in Vietnam after facing intense local competition. CENTEL initially invested THB 187 million in the venture but has continued to record losses, including a THB 42 million share loss in 2024. As of August 2025, the investment’s carrying value was THB 56 million, likely to be recognized as an impairment. The dissolution is expected to boost CENTEL’s profit by about 2% in 2026, due to the removal of share losses.
KKPS has revised its 2025E profit down by 5% to reflect the Vietnamese JV impairment but increased its 2026-2027 core profit estimates by 3% due to higher anticipated profit from the new Osaka hotel and the absence of share losses from the former JV. The valuation base has also moved forward to 2026E, resulting in a higher price objective of THB 35.50 per share (up from THB 30.00), based on a blend of PER (22x 2025E P/E) and DCF.
Currently trading at a compelling 16x 2026E P/E, CENTEL has been reiterated with a “Buy” recommendation as its profit is expected to bottom in 2025 and rebound sharply in 2026-2027, supported by the turnaround at new Maldives hotels and strategic business adjustments, KKPS concluded.
