KGI Securities (Thailand) projects a robust quarter for five hotel operators under its coverage, forecasting combined core earnings of THB 3.85 billion for 2Q26, a modest 1.5% year-on-year increase but a significant 46.8% jump from the previous quarter. The sequential recovery is expected to be driven by Minor International PCL (SET: MINT), benefiting from the seasonal peak in its European properties.
While the ongoing Middle East conflict will still impact results, sector earnings should rise modestly year-on-year, buoyed by a low base in Thailand.
Central Plaza Hotel PCL (SET: CENTEL) is poised to post the strongest year-on-year earnings growth at 15%, followed by Asset World Corporation PCL (SET: AWC) with 11% and The Erawan Group PCL (SET: ERW) at 10%. S Hotels and Resorts PCL (SET: SHR), however, is expected to swing to a core loss due to softer performances in Thailand and the Maldives. Despite mixed revenue per available room (RevPAR) trends, the sector should benefit from lower financing costs, helping offset margin pressures.
Looking ahead, KGI expects operating momentum to accelerate in 3Q26, with sector RevPAR improving from negative growth in 2Q26 to flat or even double-digit gains. Thailand is anticipated to lead the recovery, with AWC and CENTEL likely to achieve around 10% YoY RevPAR growth, while ERW and MINT should see mid-single-digit increases as tourism from Europe and the Middle East rebounds. In the Maldives, normalization of flight capacity should support flat to double-digit RevPAR growth for MINT and SHR.
KGI forecasts sector earnings will rebound further in 3Q26 and continue climbing in 4Q26, driven by peak season, stronger event demand, and government tourism stimulus. Should 2Q26 results align with expectations, first-half core earnings would reach THB 6.48 billion, covering 39.5% of KGI’s full-year sector forecast of THB 16.4 billion, implying upside potential if current trends persist.
With a more optimistic tourism outlook and geopolitical risks easing, KGI upgrades its valuation multiples for the sector, raising target prices by 6 – 13% and maintaining its “Overweight” rating. ERW and CENTEL remain top picks (Outperform, target price THB 4.30 and THB 48, respectively), while AWC is upgraded to Outperform (target price THB 3.60) and MINT remains Outperform (target price THB 30). SHR retains a Neutral rating (target price THB 1.90). KGI flags weaker-than-expected tourism and rising costs as risks to the positive scenario.
