KGI Securities (Thailand) has reiterated its optimistic outlook for Advanced Info Service Public Company Limited (SET: ADVANC), raising its 2025–27 net profit forecasts by 3–11%. The brokerage highlights three key factors:
- Stronger mobile subscriber growth
- Improved Fixed Broadband (FBB) Average Revenue Per User (ARPU)
- Cost efficiencies from lower SG&A and network operating expenses.
Significantly, KGI has also increased its anticipated dividend payout ratio for ADVANC to 95% for 2025–26 and 96% for 2027, up from the previous 91%. The adjustment reflects expectations that major shareholders—Gulf Development (GULF) and Singtel—will prioritize higher cash distributions to support their substantial capital expenditure needs over the next several years.
KGI believes the market is overly cautious, focusing only on ADVANC’s conservative 2026 guidance scheduled for release on February 3, 2026. While management may project more modest core service revenue and EBITDA growth (2–4%), KGI anticipates stronger figures, pointing to 4% revenue and 3% EBITDA increases.
These projections are underpinned by successful mobile-FBB integration, deeper content bundling, expansion into cloud services, and significant cost reduction—particularly in energy costs and SG&A-to-sales ratios expected to fall below 2.8% by 4Q25.
Even after consensus earnings for 2025–26 were revised up by 18–19% since 2025, KGI argues that room remains for further upgrades. The analyst’s forecasts are currently 5–9% above consensus, highlighting continued potential for positive surprises, particularly following the release of ADVANC’s 4Q25 results.
As interest rates fall, ADVANC’s stable and rising dividend yield—projected above 4.5–5%—becomes increasingly attractive compared to declining government bond yields. The higher payout ratio and reliable cash flows strengthen its status as an income stock.
ADVANC continues to be KGI’s top pick in the ICT sector for the first quarter of 2026, retaining an ‘Outperform’ rating. The target price has been raised to THB 366.00 per share (from THB 335.00), justified by ADVANC’s leading return on equity and robust dividends.
KGI maintains its forecast of a 4Q25 net profit of THB 12.8 billion, up 39% year-on-year and 7% quarter-on-quarter, with a second-half DPS of THB 7.91 (2.5% yield). Additionally, core profit growth is also expected in 1Q26, boosted by cellular revenue and election-related spending in February 2026.
