In line with expectations, 3Q24 results reflected a recovery in both fee and service income and cost to income ratio. We expect 4Q24 to grow both YoY and QoQ, backed by growing fee and service income. We keep our Neutral rating with an unchanged TP of Bt28.
Research
TQM - 3Q24: Recovery, as expected
3Q24: In line. TQM reported 3Q24 earnings of Bt212m (+3% YoY, +8% QoQ), in line with expectation.
Highlights:
- Fee & service income: +11% YoY, +1% QoQ in 3Q24, in line with our estimates. We maintain our 2024F fee and service income growth at 8%.
- Gross margin: -132 bps YoY, +153 bps QoQ to 51.96% in 3Q24.
- Opex to income ratio: -408 bps YoY, -206 bps QoQ to 22.55% in 3Q24, with a 3% YoY and 7% QoQ fall in opex.
Earnings outlook. 9M24 earnings accounted for 73% of our full-year forecast. We expect 4Q24 to grow both YoY and QoQ, underwritten by a rise in fee and service income.
Maintain Neutral with an unchanged TP. We maintain our Neutral rating with an unchanged TP of Bt28 (based on 5.1x PBV or 17.4x PE for 2025F).
Key risks: 1) Premiums may be hit by an uneven economic recovery and slowing car sales, 2) there could be a fall in commission rate from a change in product mix and rising competition and 3) ESG risk on market conduct.