Krungsri Securities (KSS) wrote in its analysis, expressing a slightly positive view on AP (Thailand) Public Company Limited (SET: AP) following the company’s analyst meeting review for 1H26.
During the first half of 2026, AP achieved presales of THB 23.5 billion, representing an increase of 16% year-on-year and 48% of its THB 49 billion annual target. Transfers, including those from joint ventures, reached THB 21.7 billion, reflecting a 6% rise from the previous year and accounting for 45% of the THB 47.9 billion target.
New project launches totaled THB 22.7 billion, amounting to 41% of the THB 55 billion annual goal. The residential gross profit margin was 28.8%, down 140 basis points year-on-year, attributed to increased price promotions.
For 3Q26, AP plans to launch new projects worth THB 17.9 billion across both low-rise and condominium segments. The company projects strong presale and transfer figures year-on-year, driven notably by a larger contribution from new low-rise projects and upcoming condominium transfers.
The residential gross profit margin is expected to improve compared to 1H26 due to a higher proportion of new projects being handed over, which typically yield better margins than existing inventory. Net profit for 3Q26 is anticipated to remain steady year-on-year and rise quarter-on-quarter, with figures expected to stay at a relatively high level.
Looking to the full-year 2026, AP has revised its project launch plan to THB 56.6 billion, 6% below the previous year but still robust. This comprises 77% low-rise and 23% condominium developments—approximately THB 44 billion in low-rise (-12% YoY) and THB 12.6 billion in condominiums (+31% YoY).
The sales target for the year is maintained at THB 49 billion, a 5% rise from last year, with growth anticipated in both segments. The transfers target, including joint ventures, is set at THB 47.9 billion, up 7% year-on-year. Residential gross profit margin is forecasted in the range of 29-30%.
Five new condominium projects with a combined value of THB 11.3 billion are slated for transfer during the year, with an average sold rate of 68%. The transfer backlog remains high at THB 41.8 billion, with THB 20.5 billion expected to transfer in the second half—securing 88% of AP’s 2026 target.
Remaining unsold finished condominium inventory stands at about THB 8.9 billion, which is estimated to be cleared in approximately a year, based on first-half sales and transfer rates.
The planned landbank CAPEX stands at THB 15 billion, with THB 7.7 billion (52% of plan) already utilized, underlining AP’s ongoing expansion. Debt levels are managed well, with net IBD/E at a low 0.65x and expected to stay in the 0.6–0.7x range. The company also has undrawn credit lines of around THB 18.8 billion.
In 2H26, bonds totaling THB 3.5 billion will mature, but AP has already arranged for refinancing, and financing costs continued to decrease, reaching 2.9% in 2Q26 compared to 3.2% in 2025.
For the first seven months of 2026, presales reached THB 28 billion, marking a 14% year-on-year increase, mainly from new project launches and strong sales rates. The impact of rising construction costs due to Middle East geopolitical issues remains limited, contained by effective contractor negotiations. Cost increases are kept to 1-2%, allowing for potential price adjustments if needed.
Krungsri believes AP’s results in the second half of 2026 will outperform the sector in presales, transfers, and net profit, buoyed by steady new project launches and high backlogs. The 2026 net profit forecast is held at THB 4.5 billion, up 5% year-on-year, primarily from increased transfers. Sensitivity analysis suggests that every 1% decrease in gross profit margin could result in a 6% drop in net profit from projections.
The target price for 2027 is set at THB 11.40 per share, with a maintained ‘Buy’ rating. Krungsri highlights AP’s ongoing market share expansion and price competitiveness, which supports above-average industry margins. The stock is trading at 5.7x 2026 PER with an expected dividend yield of 7-8% annually, presenting an attractive valuation.
