Preview 4Q24F: Expect YoY growth
We expect BEM to report 4Q24F earnings of Bt899mn, up 4.6% YoY on MRT growth, but down 15.7% QoQ on the lack of dividend income. Based on 4Q24F numbers, 2024F net profit will be Bt3.8bn, up 9.6%, which lines up with our full-year forecast. We keep our 2025F at Bt4.3bn, up 12.9% YoY, supported by expressway and MRT businesses. The government’s Bt20/trip move is still hanging fire, with no word as to whether this will be subsidized directly or via concession buyback. In terms of near-term share price reaction, we believe a concession buyback would spur price the most. We maintain OUTPERFORM with an SOTP-based TP Bt10.5/sh (Bt8.2/sh for core business, Bt1.5/sh for the Orange Line and Bt0.8/sh for investment in TTW and CKP). We like BEM for its steady earnings growth; it also has potential upside from the double deck project, which is not in our forecast.
Expect 4Q24F earnings to grow YoY, but fall QoQ. We estimate 4Q24F net profit at Bt899mn, up 4.6% YoY on rising MRT ridership (Blue Line) and a hike in fares, but down 15.7% QoQ as no dividend income was booked in the quarter. Revenue from the expressway (51% of total revenue) is expected to be Bt2.3bn, slipping 0.4% YoY due to partial closure of its expressway system and 1.1% QoQ on seasonality as 4Q24 has more holidays. MRT revenue (42% of total revenue) is estimated at Bt1.8bn, up 13.7% YoY and 3.4% QoQ, driven by rising MRT riders and a hike in fares from July 2024. Revenue from commercial development (7% of total revenue) is estimated at Bt337mn, increasing 10.1% YoY and 9.4% QoQ, in line with growing ridership. Based on 4Q24F numbers, 2024F net profit will be Bt3.8bn, up 9.6%, which lines up with our full-year forecast. Results will be released on Feb 26.
Traffic updates. In 2024, average expressway traffic was 1.1mn trips/day, flat YoY. As noted, traffic was impeded by partial disclosure of its expressway network from May 2024, and which is scheduled to run until May 2025; this is in line with our forecast of flat growth in 2024F. Average ridership on the MRT (Blue Line) was 426.9k trips/day, growing 9.4% YoY. This is in line with our assumption of 10% growth.
Keep 2025F forecast. We keep our 2025F earnings at Bt4.3bn, growing 12.9%. Our assumptions are based on 1.1% growth in average daily expressway traffic, improving from no growth in 2024 based on an anticipated reopening of its entire expressway network in May 2025. We expect average daily MRT ridership (Blue Line) to grow 7.5% YoY plus there will be the boost from a full year of the higher fares (effective in Jul 2024).
Risks and concerns. Key concerns are the recovery of expressway traffic and MRT ridership. Key ESG risk for BEM is travel safety. A perception of lack of safety would reduce the number of people using expressways and the MRT. This would lead to downside to our earnings forecast.
