Aiming at 20% presales growth in 2025
SPALI is targeting 20% presales growth in 2025, although it is bringing down the value of its new launches by 12%. Backing growth will be inventory, presales of ongoing projects and the highest condo presales in seven years. We maintain our 2024F net profit forecast of flat earnings with 4Q24F to drop both YoY and QoQ. A full year consolidation of the new investment in Australia in 2025 may limit earnings growth in view of its low secured revenue. We stay Neutral with a 2025 TP of Bt20.0 on PE of 6.2X (-0.25 S.D., 18 years). We expect a 2H24 dividend of Bt0.63/sh, yield of 4%.
Aims at 20% presales growth in 2025. SPALI has set its 2025 presales growth target at 20% to Bt32bn, 65% from low-rise, value up 23%, and 35% from condos, where value will grow 13%. This year’s new launches will be more focused on condos, with eight projects planned, valued at Bt12.8bn, the highest in six years; locations will be spread out from the CBD, along mass transit lines and in other provinces such as Phuket and Chonburi. Low-rise launches will be cut 29% in value to Bt33bn, calming after climbing to new highs in 2024. It will continue to emphasize the mid to mid-low segments, where it is strongly positioned, apart from one new condo near Sukhumvit 39, which will edge toward mid-high.
Starting full-year consolidation in Australia. After adding 12 new residential projects in Australia at end-December 2024, projects in Australia generated 2024 presales of Bt3.1bn (+49%). In 2025, with 24 projects on hand and two projects close to selling out, SPALI aims for total presales growth of 100% to Bt6bn. This should underwrite strong growth from JVs in 2025 and is already included in our current projection.
4Q24F net profit to fall YoY and QoQ; maintain 2024-2025. With continued transfers of backlog in 4Q24F, we estimate revenue at Bt9.6bn (down 4.6% YoY and 2% QoQ), 73% from low-rise and 27% from condos. We expect SG&A to rise YoY from higher selling agent fees. JV contribution from Australia is estimated at Bt100mn (+102% YoY and +154% QoQ). We maintain our 2024 net profit forecast of Bt6bn, flat YoY. Its current backlog is Bt11.5bn with 65% to be recognized as revenue in 2025 and the remaining 35% in 2026-2028. We maintain our 2025F revenue at Bt30.8bn (-3.7%), with 25% secured, giving net profit of Bt6.3bn (+5.1%) including the new Australia venture.
Risks and concerns. Inventory management: since 2024 was SPALI’s highest year ever for launches in terms of value at Bt52.3bn, unsold units and inventory management in 2025 will be key to earnings and cash flow.
ESG key risk. SPALI was downgraded from SET ESG ratings in 2024 to A level from AA in 2023. Although SPALI obtains EIAs for residential projects, which helps lower environmental risks, lawsuits have been filed against some condos, which we see as ESG risks for environmental and social elements as they affect surrounding neighborhoods and governance. SPALI aims to reduce greenhouse gas 40% by 2030.
